WORKING TO BE COMPLIANT
Manufacturers and retailers have long known that these rules were
coming, as some rules were proposed as far back as 2014. Manufacturers
say they are working to make sure they are compliant, helping retailers
be compliant and, at the same time, launching products and gaining
E-Alternative Solutions, based in Darien, Conn., a sister company of
Swisher International, last year launched Cue Vapor System, an e-cig-
arette device that is rechargeable and uses a pre-filled, disposable car-
tridge. Jacopo D’Alessandris, president and CEO of EAS, says the com-
pany is working to expand distribution. “This product has a unique
business model,” he says. “It is not only distributed at retail, but is also
sold online and via infomercials.”
D’Alessandris says the infomercial campaign airs mostly at night.
“We think that online and the infomercial is perfect for trying the kit,”
he says. “There is a lot of education that is delivered through the televi-
sion commercial and also online.” He adds that when people buy online,
they tend to buy large quantities because they are paying for shipping.
Once adult consumers have the kit and they need to buy more cartridges, they can order by phone, online or stop at their grocery store.
Buying a cartridge from the grocery store makes sense to this audience, D’Alessandris says, because they are
used to going to the store to buy a pack of
cigarettes. He adds that the multiple outlet
strategy is working, and that EAS is seeing
repeat purchase percentages that are three
times higher than other e-cigarettes.
“The ultimate goal is to try to drive
them to retail,” he says. “For us, brick-and-
mortar is the foundation of our business.”
Others agree that the new rules present a challenge to the industry.
Ryan Coalson, director of sales operations for Fontem US,, based in
Charlotte, N.C., says the rules are causing confusion among retailers,
who do not know which products will go through the review process
and which companies will remain viable.
Fontem, which makes blu e-cigarettes, is dedicated to helping retailers handle the changes. “Fontem is undergoing an initiative to ensure
compliance with FDA guidelines across all of our current assortment of
fixtures,” Coalson says. “We will meet all of the deadlines and reduce
the potential of trade partners being out of compliance with the FDA
relative to the newly required warning labels.” He adds that retailers
that are succeeding in the category are the ones that put e-cigarettes in
a visible place, as many adult consumers are new to the category and are
investigating the space.
Coalson says another confusing issue is the various state, local and
municipal taxes. “That drives up prices and makes e-cigs less attractive to adult smokers considering integrating them into their lifestyle,”
The brand launched Glacier Mint disposables, which Coalson says
have met great success. “Fontem/blu will continue to support current
products and bring new products to life that are attractive to your adult
smoker shoppers,” he says.
Another way to boost sales is with periodic promotions, says Jessica
Fratarcangelo, marketing director for Cheyenne International, LLC,
based in Grover, N.C. “The promotions are often supported by manufacturers who can assist with in-store merchandising.” she says. “Using
regular communications, such as promotional emails to qualified adult
consumers, is also a great way to stimulate category growth.”
LIGHTING UP CIGARS
According to IRI, cigar sales totaled
more than $391.9 million, an increase
of 8. 9 percent. Unit sales were more
than 143.5 million, up 17. 37 percent.
The key to success in the cigar cate-
gory, Fratarcangelo says, is consistency.
“Trends come and go, and while trends
are important to pay attention to, the
biggest factor in sustaining a category
and a brand is consistent quality,” she
says. “The cigar category is no differ-
ent. In addition to quality, it is impor-
tant for retailers to provide a good mix
of offerings since choice is a luxury that
most adult consumers have become
Cheyenne International recently
added Strawberry 100’s to the Cheyenne
Cigar brand lineup. Strawberry is made
at the company’s manufacturing facility