E-Commerce Platforms Remove Vapes, Wiping Out Hundreds of Millions in Ad Spend

Winter of e-cigarettes comes earlier than in the real world.

On the evening of November 5, Jingdong Suning removed e-cigarettes one after another. Steam faction Vapepi found that searching for the word e-cigarette on Suning and Jingdong websites found nothing to find.

A day later, idle fish took off the e-cigarette.

On the morning of the 7th, Tmall Taobao blocked e-cigarette keywords. At the same time, there is no trace of e-cigarettes on Panduo.

So far, major e-commerce platforms have completely blocked e-cigarettes.

All this stems from an official document from the regulatory authorities a week ago.

On the afternoon of the 1st, the State Administration for Market Regulation and the State Tobacco Monopoly Administration jointly issued a notice stating that minors should be prevented from purchasing and smoking e-cigarettes through the Internet to further protect minors from e-cigarettes.

Implementing the measures means, in short,It is necessary to completely ban the sale of e-cigarettes online。

This is nothing less than shocking news for major electronics manufacturers that are preparing for the Double 11.

“Double 11 can only be done completely。& rdquo; Some industry insiders conservatively estimate that this means that major e-cigarette factories will lose hundreds of millions of yuan in advertising costs.

It is reported that in order to save subsequent operating costs, more than 200 people in the company have laid off 1/3 of their staff. According to the person in charge of a leading e-cigarette brand, the entire online team will be laid off.

On the other hand, offline retail stores are under regulatory pressure and are afraid of backlog of goods, so they have launched a clearance sale model. Steam sent Vapepi to visit several tobacco shops in Beijing, but only its mini, FLOW, MK and other brands saw price cuts of 10% to 50%.

There is a murderous smell of blood in the sky in late autumn, and the e-cigarette industry is undergoing a major escape.

Electronic cigarette misfires

Late at night, when Liu Yuqiang got off the plane, the cold air from the north rushed towards him. Compared with the hustle and bustle at the Shanghai Electronic Cigarette Exhibition the day before, Beijing is depressed and chilly at the moment.

“The day has finally arrived.& rdquo; He said silently. The head of the marketing department of the e-cigarette factory couldn't hide his tiredness, but he had to rush to his office in Wangjing immediately. There, a room full of people and cigarettes were waiting for him.

This day is the second day since the e-cigarette ban was promulgated. The upcoming Double 11 battle has not yet sounded, and the hammer of supervision has fallen.

“Faster than we thought.& rdquo; An e-cigarette agent said that due to the e-cigarette ban, he has also begun to liquidate the accumulated e-cigarettes in his hands. If the cigarette factory starts to cut prices, he can get out in time.

A piece of official document has made the entire e-cigarette industry jittery.

A week ago, the State Administration for Market Regulation and the State Tobacco Monopoly Administration jointly issued a notice stating that minors should be prevented from purchasing and smoking e-cigarettes through the Internet to further protect minors from e-cigarettes.

“On the night that the e-cigarette ban was promulgated, Pinduo successively blocked search results for keywords such as e-cigarette FLOW. (Then went online and removed again)

Immediately, more than 20 e-cigarette brands such as RELAX, FLOW, and MOTI Magic Flute took a stand and stated that they would ban the sale of e-cigarettes online and actively improve the layout of offline channels to not serve minors.

Statement issued by Yueshi on the 7th

In fact, as early as August last year, the above two departments issued the "Notice on Banning the Sale of E-Cigarettes to Minors". At this year's 315 party, e-cigarettes were named and exposed by CCTV, claiming that e-cigarettes contained excessive amounts of formaldehyde, propylene glycol and glycerol. Substances that have a strong irritating effect on the respiratory tract.

Now that the past is happening again, supervision is becoming more vigorous and vigorous.。

“The trees are beautiful in the forest, and the wind will destroy them. E-cigarettes make too much money and the masses are too large. Finally, they will be beaten up." rdquo; An industry insider said.

According to the relevant person in charge of the State Tobacco Monopoly Administration, the tobacco monopoly supervision departments in key areas are currently negotiating with relevant law enforcement agencies on major e-commerce platforms to urge them to close e-cigarette shops in a timely manner and remove e-cigarette products.

On the afternoon of November 5, nine platforms including Jingdong and Kuaishou were interviewed. That night, Jingdong and Suning removed e-cigarettes one after another。

A head electronic cigarette factory in Beijing revealed that it was also interviewed that day.

Jingdong, Suning, Pinduo, Xianyu, and Taobao Tmall have successively removed or blocked e-cigarette keywords, which has poured cold water on the booming e-cigarette industry.

According to incomplete statistics, in the first half of 2019, the number of investments in the domestic e-cigarette industry reached 35, with financing exceeding 1 billion yuan. The momentum is unstoppable. There is also news that North American e-cigarette giant JUUL issued a year-end bonus of US$1.3 million per employee last year. It was shocking.

This year's Double 11 was originally a marketing center for major e-cigarette factories. According to conservative estimates by industry insiders, e-cigarette brand manufacturers have contributed hundreds of millions of yuan in advertising fees to the distribution, marketing and advertising space of Double 11.

Now, with the boots of supervision down, and in an instant, the e-cigarette industry, which is on the rise, is about to go viral.

E-cigarette + WeChat

Under the pressure of supervision, e-cigarette brand manufacturers also have to find their own way out.

Industry insider Xiao Yucheng told vapepi that e-cigarettes have three online sales channels.

The first is community e-commerce. E-cigarettes are products with high repurchases. Old users are added to the community for maintenance and repurchases. This is also a regular operating method for various e-commerce platforms.

Second, WeChat channels and QQ channels have always been relatively hidden sales channels, which are more difficult to implement supervision. They are also the main sales channels for various types of three-no and gray industries.

The third is the channels for second-hand platforms such as Zhuan and Idle Fish.& ldquo; This channel may be blocked in the future, but it cannot be banned. Second-hand platforms have always been platforms for playing the edge and doing sales." rdquo;

Nowadays, e-commerce channels have completely stalled. Social e-commerce is what major e-cigarette brands such as Yueshi and FLOW are doing. Second-hand platforms were once a battleground for agents, but e-cigarettes have now been completely removed. The new source of sales growth is mainly the second type of micro-commerce.

WeChat model + e-cigarettes, is this model feasible?

The model of selling goods through WeChat has existed in the tobacco industry for a long time. Industry insider Niu Dazhi revealed that most of the sales channels of foreign cigarettes (imported cigarettes and smoking equipment such as pipes, pipes and cigars) in the past relied on micro-businesses.

“In fact, this matter is really a good thing for WeChat.& rdquo; Niu Dazhi revealed that Luo Yonghao's e-cigarette brand, vvild Ono, currently relies on the WeChat model. It is said that it has introduced personnel from a large direct selling company in Tianjin.

According to official information, Ono's sales cooperation models are divided into three types: no-threshold partner franchise stores and provincial and municipal investment promotion. Among them, no-threshold partners refer to the WeChat distribution model and are divided into two types: ordinary distributors and senior distributors. The promotion commission ratios are 34% and 35% respectively, in addition to 8% and 10% head-pulling rewards.

Previously, e-cigarette brand YOOZ used a WeChat model to sell cigarettes. YOOZ founder Cai Yuedong once announced in a circle of friends that shipments exceeded 100,000 units from June 1 to 20.

A new e-cigarette manufacturer in Beijing revealed to Steam Pai that it mainly cooperates with WeChat online, and Taobao, Jingdong and other e-commerce channels do not pay much attention to it.

However, while the WeChat model promotes sales, it also brings risks. In March this year, the Fengtai Court heard Beijing's first illegal e-cigarette business case. The defendant was sentenced for selling cigarettes.

“Policies can ban sales, but not demand.& rdquo; Xiao Yucheng said that as long as there is a need, there will always be a way.

big escape

After the comprehensive online ban on smoking, the entire e-cigarette industry is nervous. No one knows when the next boot under supervision will fall.

“Action will be taken as early as the end of this month or early next month at the latest.& rdquo; A source revealed.

A spokesperson for an e-cigarette brand in Shenzhen that is undergoing consumer electronics transformation said that after Double 11, more standardized documents will come down.

The e-cigarette industry is staging a major escape。

Niu Dazhi told Steam Faction Vapepi that brands that had previously paid too much attention to online channels, such as Yueshi, would suffer heavy losses.

“It has a greater impact on Yueshi than other brands。& rdquo; He said that before the comprehensive ban, when searching for e-cigarettes on Taobao, 4 of the top five were Yueshi, indicating that Ruishi paid a lot of money for this. If Taobao removes e-cigarettes, it means that Yueshi's tens of millions of advertising fees will be wasted.

Niu Dazhi said that after second-hand platforms such as Xianyu refused to allow the sale of e-cigarettes, it would be difficult to flee the goods, that is, reselling no longer worked. Prices will be formalized, but due to the huge profits and exclusivity of e-cigarette products, offline channels will become extremely important. Whoever can master enough offline resources represents absolute strength.

Previously, Yueshi did not place too much emphasis on offline viewing.

“The price they gave the provincial representative was too high. The cigarette cost 99 yuan, and they wanted to sell it to us for 90 yuan. It was too strong. rdquo; An e-cigarette seller told Steam Pai.

Due to the comprehensive online blocking and blocking, it means that all the hard work in the early stage has been in vain. A group of e-cigarette agents preparing to gamble on Double 11 complain endlessly. What's more, there is news that agents committed suicide.

At the same time, the pressure of supervision has also been heard offline. Offline tobacco shops in Hubei, Guangzhou, Guangxi, Chongqing and other places may face supervision.

Niu Dazhi said that offline stores should not be closed, but stricter controls will be imposed. For example, e-cigarettes cannot be sold within one kilometer of schools.

But no matter what, everyone in the e-cigarette industry is in danger, and no one wants to be a scapegoat.”。

Recently, Ruike issued a notice to offline agencies, warning to do sufficient self-inspection work:

1. No cigarette characters can appear in stores. If there is a poster that says replacing the atomizer, you can stick the cigarette characters with white paper first, and we will replace them for everyone later;

2. All users must present their ID card to purchase products (regardless of age, to prevent reporters from taking photos). Users wearing school uniforms are prohibited from entering the store.

A person from the Tobacco Bureau told the steam faction that the current work is also carried out within the framework of national laws. As a new tobacco product, e-cigarettes are lagging behind in the law. Currently, the legal regulations on the management of e-cigarettes need to be more improved. The focus is to standardize the e-cigarette market and strengthen the management of e-cigarettes.

Finally, where will e-cigarettes go? Perhaps only WeChat can save e-cigarettes.