The development of the vaping device industry needs innovation and technology, not monopoly

First, let me mention something off-topic. Recently, a platform conducted a survey, and a large number of Tesla users believe that the Model 3 is superior to the Mercedes-Benz C-Class, BMW 3 Series, and Audi A4. What? Clearly, they are in the same class, with similar dimensions and prices. The top configuration of the Model 3, the Performance version, is priced at only 419,800 yuan. What makes it superior? However, the reality is that Model 3 users do not even consider themselves on the same level as owners of the Mercedes-Benz C-Class, BMW 3 Series, or Audi A4; they even look down on the E-Class, 5 Series, and A6.

Yes, despite the traditional perspective that the Model 3 is on par with the Mercedes-Benz C-Class, BMW 3 Series, and Audi A4, consumers have established a new standard and mindset for evaluation based on technological iteration and brand elevation.

This is infuriating to think about. The brand authority and product hierarchy that traditional automotive brands have painstakingly built over the years—such as Mercedes-Benz's S-Class, E-Class, C-Class, BMW's 7 Series, 5 Series, 3 Series, and Audi's A8, A6, A4—have been dismantled by a "barbarian" like Tesla that barged in halfway. The public must feel frustrated, as they once put in great effort to create the Phaeton, establishing a transparent factory and producing alongside Bentley... In the end, apart from the distant East, which was once willing to pay for deliberate low-key, they had to shut down and pivot.

But the fact is, consumers are using a new standard and mindset to make evaluations, and the progress of technology itself has broken the established hierarchy.

On one hand, consumers will not make choices in the way brands hope. The target users of the Mercedes-Benz C-Class are similar to those of the BMW 3 Series and Audi A4, not worried about the diversion from Accord, Camry, or Passat. However, the Model 3 not only competes with the C-Class but also attracts some users from the E-Class, 5 Series, and A6; on the other hand, every technological advancement and model iteration brings new value updates for the Model 3 that are not within the traditional discourse system, allowing users to switch from generation to generation without needing a simple brand upgrade.

How can I describe this feeling?

It's like 8848 can only use genuine leather and titanium to create and showcase a sense of value, while the iPhone 12 and Mate 40 can easily crush this superficial sense of high-end with technology and performance. If in the past, one needed to rely on brand, culture, and history to endorse and seek a basis for price setting, now, having technological support, design expression, performance guarantees, and emotional resonance is enough to dismantle brand authority, especially for categories that do not require or emphasize lineage.

Returning to the tobacco field, the same principle applies. Traditional tobacco products have a strictly hierarchical value system; "Zhonghua" cannot and will not lower its product line to 200-300 yuan, while "Furongwang" is deeply rooted as a leader in the first category, and "Hongtashan" has made great efforts to produce a 500 yuan product. Even if it uses materials and craftsmanship worth a thousand yuan, the product strength and value perception are so strong that it cannot impress consumers who have deeply recognized and become accustomed to the existing brand value system. The sub-brand strategy essentially still operates under the premise of adhering to the game rules.

However, electronic cigarettes, in the form of devices + pods/e-liquids, easily dismantle the seemingly solid and complex craftsmanship and technology of traditional tobacco products, also breaking down the structure and style of tobacco products, just like Tesla facing fuel cars. Your interior is luxurious? I have intelligence and a large screen leading the trend; you are economical and fuel-efficient? I use electricity, and my transmission efficiency cannot be matched; your performance is excellent? My Model 3, priced at 200,000-300,000 yuan, can achieve supercar acceleration; what can you do?!

Therefore, the Model 3 has already achieved the highest sales in its price range in Beijing, Shanghai, Guangzhou, and Shenzhen.

Beyond the starting line of technology, whoever is trendier, cooler, and more stylish can win the favor and preference of consumers. This is a different evaluation system accepted and recognized by the younger consumer group, distinct from traditional tobacco products. Conversely, technological innovation can easily dismantle traditional value systems. Today, entry-level Android phones easily outperform all past flagship models in performance, and no consumer would give up the pursuit of higher performance and more features for the sake of so-called flagship status.

Furthermore, the device + pods/e-liquids are in a semi-finished state, and the diversity and richness of pods/e-liquids provide consumers with nearly infinite combinations. What does this mean? Feature phones are in a finished state; their programs and functions are fixed, and updates require changing phones, while smartphones are different. Users decide what applications to install, creating a personalized experience. Electronic cigarettes have this condition, and in the future, we may not rule out the possibility of an ecosystem similar to iOS.

For traditional cigarettes, no matter how personalized or differentiated the design is, it is difficult to avoid the dilution and dissolution of scale. Coupled with large-scale industrial production, machine-made cigarettes cannot maintain the topic and value through ritual and scarcity like handmade cigars. The moat established based on high-quality materials and exquisite craftsmanship is utterly defenseless in the face of technological breakthroughs. When traditional habits gradually accept new things, or new things change traditional habits, everything becomes completely irreversible.

At least for now, we see that the consumer group of electronic cigarettes has similar evaluation standards and interests to Tesla owners.

In the short term, the change presented is a decrease in consumer price sensitivity. More dangerously than pursuing cost-effectiveness is the loss of the necessity for high prices. Consumers of "Zhonghua" may disdain the product choices of "Hongtashan," but electronic cigarette consumers—no matter how much cheaper—will not feel that they are losing face compared to "Zhonghua." Instead, they may be dissed for not being trendy, cool, or stylish enough, leading them to distance themselves from and abandon brands and categories that are not trendy, cool, or stylish enough.

Of course, automotive brands can still maintain a level gap similar to that between the Model S and Model 3 through vehicle size, battery capacity, acceleration performance, etc., but what about traditional tobacco products? Can they establish so many differences and distinctions? The ultimate trend of all this is to continuously harm the value degradation and social marginalization of the cigarette category. One is a question of worth—whether the brand and product are worth the price; the other is a question of necessity—whether new categories, new forms, and new scenarios will form a substitute.

This is a change worth paying attention to, or rather, a change that needs to be taken seriously.

Returning to electronic cigarettes, it seems like the "giant is trapped," but in reality, it is closer to a difficult situation under restraint—first restraint, not stagnation, but it is indeed troublesome. At this stage, no matter how one participates, the necessity and rationality lack persuasive support, especially in the context where the safety and risks of electronic cigarettes are yet to be fully confirmed, a scientific and prudent attitude is even more necessary. We should be prepared to be more proactive, but specific actions must be rigorous and meticulous.

Because of this, we cannot just think about rushing to the field; the key is to keep pace with the times in our thinking, actively embrace new technologies, new species, and new trends, rather than being indifferent or powerless.