The splurging of tobacco companies on ecigarette brands continues, as the giant Japan Tobacco snaps up Logic Ecig for an undisclosed figure. If this sounds type of headline sounds familiar to you, it’s because it isn’t new. Although we haven’t had a buyout of a large ecig maker in the US for over a year now, when Altria purchased Green Smoke, this type of thing was bound to happen again.
It all got going when Lorillard picked up Blu ecig in 2012 and things have rolled along since then. With Big Tobacco now fully grappling with the emerging electronic cigarette market, everyone is trying to get in on the popularity of vaping, one way or another.
While we haven’t seen much news for quite some time in terms of ecigarette companies being purchased, at least relative to that flurry of 18 months that concluded with Altria buying Green Smoke, this still isn’t a surprise. Logic Ecig had to be a popular target, being that the company is already in retail stores and doing relatively well. At least it was before Blu Cigs from Lorillard and later others, like MarkTen also from Altria and Vuse from RJ Reynolds, cut into their market share.
The Logic eCig is still a popular one and was attempting to vie for a spot on the shelves with their competition from those aforementioned Big Tobacco brands. But money talks and it was obviously going to become harder and harder to compete without that backing.
In steps Japan Tobacco at the right time to scoop up Logic Technology, maker of Logic eCigs, and add it to their own repertoire of ecigarette companies.
They add the Logic ecig to their addition of the UK-based E-Lites brand which they purchased in June of last year. This move was clearly intended to give them the footing in the US that E-Lites hasn’t been able to do, and with it they can compete with Blu e cig and the other Big Tobacco brands.
Will Logic eCig Purchase Be The End Of The Logic Pro?
We assume the plan is for the retail market to expand, unless Japan Tobacco sees reason to go after the online market against such ecig brands as Green Smoke and others.
The bigger profit seems to be in retail stores for Big Tobacco, where it already has an infrastructure in place to push their own products in front of the eyes of customers who may purchase based on name recognition or snazzy marketing alone.
Where this will get interesting is that Logic ecig is further along than the others in terms of more powerful systems.
They may not have a fully-fledged open tank system that we would like to see, but they do have the Logic Pro.
Logic Pro is a closed tank system is still further along than anything Big Tobacco is putting out their via their own brands.
This is because Big Tobacco is fighting open systems tooth and nail at a time when they are expanding in reach and meeting the needs of so many smokers. Will this acquisition lead to a change in strategy for at least some tobacco companies? Or are we going to see the Logic Pro get shut down for fear of coming FDA regulations?
Whatever the answers may be, this move shows us that it is becoming increasingly more difficult for electronic cigarette companies to survive on their own, without the backing of deep-pocketed parent companies. Up until now it has been Big Tobacco using those dollars to compete, but we can’t rule out other large companies getting into the game too.
What it does do, unfortunately, is shrink the number of independent USA ecigarette companies who up until now have been the ones most likely to innovate. They’re also the ones that don’t come with the black stain of a past littered with disinterest in the welfare of their customers. But here we are, another domino has fallen.
Is there another one coming next or has Big Tobacco completed its sweep of gobbling up ecig companies. We’ll find out in due time and we’ll keep you informed as always.