Millions of Flavored Vape Users Are Being Lost, Pushing Brands Into a Profit Squeeze

In 2023, it is expected that domestice-cigarette marketShrink another 50%

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Focus on the development of the electronic atomization industry, trendy and new media

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Domestic Market

Looking forward to 2023, the industry has a strong understanding of domestice-cigarettesThe market is generally pessimistic. It is expected that the retail market will continue throughout the year Shrink by more than 50%, those with extremely pessimistic views say that they may Shrink by 70%。

As a leading enterprise,yueshiSales data of can reflect the current domestic market situation (current market share80-90%）。Although the New Deal abolished business exclusivity, the competitive landscape has not changed significantly, and there is little chance for a turnaround in the medium and long term.

Some companies can only purchase their own products and send them to users to maintain their market position, which has severely affected profits. Terminal price wars have become the norm, and a large number of tobacco rods have been given away to attract users, making the profits of the entire industrial chain worrying. The situation of low profits and difficulty in accessing capital has caused many brands to reduce salary/layoffs many times in the past six months, and streamlining personnel has become an important means to control costs.

Industry analysts believe that domestic growth will remain sluggish in the next five years. In 2022, we will encounter triple blows from national standards, flavor restrictions, and epidemic situations. In 2023, consumer acceptance will be limited, the tax burden will be unclear, and market expectations will not be optimistic. However, with the increase in awareness of harm reduction and the improvement of product power, e-cigarettes are expected to grow rapidly again after 2025.

Our country has the world's largest adult smoking population (more than 250 million), but the penetration rate of e-cigarettes is far lower than the average level in Europe and the United States, and there is much room for improvement. According to the latest number of 12 million e-cigarette smokers (our latest research is that the number of domestic e-cigarette active users is about 2 million people) and the number of adult smokers exceeding 250 million, it is calculated that the penetration rate of domestic e-cigarette smokers is about 3-5%. If it reaches the level of 30-40% in developed countries within ten years, then the average annual compound growth rate can reach 20-25%, with broad prospects.

Although the domestic e-cigarette market is currently facing problems such as competition from illegal products and difficulty in smoking national standard taste feedback, market demand has not disappeared, but has been suppressed by these factors. With the improvement of national standard taste, the gradual relaxation of channels, the reduction of fruity e-cigarette stocks in consumers 'hands and the beginning of trying new national standard products, and the regulatory crackdown on illegal products prompting some consumers to return, sales in the domestic e-cigarette market are expected to increase.

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Global Market Chapter

In 2023, the global e-cigarette market will enter a period of differentiation. The strong remain strong, but the weak cannot survive. Brands and manufacturers are facing a reshuffle. By 2024, the market landscape will be more polarized. In the past, when the channel was king, the era ended, and brands began to solidify their channel advantages, while technological innovation became the key to life and death. China companies have risen with their technological strength and occupy a larger market share in the world. The status of China brands in the global market is gradually increasing. For example, three of the top four brands in the British disposable e-cigarette market are China brands (Elf Bar/lost mary, Elux, SKE), and Elf Bar/lost mary in the US disposable e-cigarette market is the leading brand in the US market.