Wouldn’t it be great if we could sell a product that would really help people quit their addition to smoking cigarettes? There are current products in this market attempting to help people, but they all have their own flaws. The patch and gum delivers the nicotine that smokers crave, but they do not take into account the mechanical addition smoker have setup for their smoking routines. The solution we are proposing is not new, but it has been poorly executed in the past. An electronic cigarette is capable of delivering the nicotine that smokers crave, with the mechanics of real cigarettes, without the harmful smoke and chemicals.
The Current Market
The market is large, “In the United States, an estimated 24.8 million men (23.1 percent) and 21.1 million women (18.3 percent) are smokers.” (%^&*()) Many of these people are now well informed about the dangers of smoking but are having trouble because of the addictions involved.
“It is estimated that nearly 17 million Americans try to quit smoking each year. That is great news! The bad thing is that only about 1.3 million Americans are able to remain smoke free. Only 8 percent or so of smokers that quit smoking are successful in their efforts.” (healtheffectsofsmoking.org)
The bad news is that there are many “quit smoking” devices targeting this market of people. There is nicotine gum, nicotine patches, self-help tapes, hypnotherapy, and several more. Also, there is what is commonly known as an electronic cigarette.
Electronic Cigarettes, or commonly known as eCigs, have been produced in China for over 10 years now. They have been sold in the US through a few different means, mostly online or at mall kiosks. The basic design is a small batter inside of a aluminum tube powers a micro chip that heats a “atomizer” which vaporizes the glycol and flavoring as the user inhales. This creates a safer, simulated smoke that delivers the taste and nicotine, similar to a real cigarette.
For the past 10 years, these China made eCigs has been plagued with problems both mechanically, safety wise, and how they are marketed and sold. After reviewing over 100 different types of eCigs on the market today, the conclusion has been drawn that the majority are way too low of quality and are just basically garbage. Some tended to overheat and nearly catch on fire, others failed after only a very short time, some had massive short cuts. Some of them even tested positive for lead paint. China has had a bad rap for sometimes producing low quality, unsafe products and the eCigs are no exception. The breathable chemical, like the medical grade glycol and flavoring are also very questionable when it comes to safety. Ecigs have been sold on the primarily on the Internet and over priced mall kiosks. For the past few years, several bad apple companies have given really given eCigs a bad rap, they have been selling the kits to customers for just $10.00 or so shipping cost, then a month later charging the customer $100 to $200 as their “trial” expired.
One final complaint that has been voiced repeatedly is the 3-piece design of the existing eCigs. There a battery with microchip, an atomizer and a cartridge that kind of holds the juice. The problem is it does not hold it well and it tends to leak everywhere. Also, the atomizers tend to hold bacteria and wear out, making them unsafe for long-term usage.
The Business Idea
Knowing all this information about the existing market, we certainty have a second-mover situation and advantage. We are able to see the mistakes of all the competitors and enter the market with a better product. The first step to this was choosing the best manufacture that could also get us a competitive price. The second step was to keep very tight requirements on each aspect of the manufacturing process; everything must be built to our exact speck. Quality control became an extremely important factor. And most importantly, we dumped the 3-piece design in favor of a two-piece. A brand new atomizer is now built into every single cartage, and given the new name of cartomizer. Every time a cartomizer is dried up, the user simply and easily replaces the cartomizer with a brand new one.
We knew there must be a better way to sell and eCig. After all, the majority of cigarettes are currently cold at convenience stores and gas stations, so why not choose to sell in that market? Online sales are also important, but we needed to make it clear that our product would be scam free, we would never charge their credit card without their knowledge.
Inventory is a critical factor of these sales; we have to maintain enough products in stock to meet the demands of our distributors and all the direct customers shopping at our ecommerce site. The problem was solved by shipping airfreight directly to our distributor form the factories and also having products shipped directly to our warehouse to be sold to online customers.
The Results (to date)
After launching Cig2o in a few hundred test stores 6 months ago, our response has been terrific, the brick and mortar store’s sales have fueled the ecommerce site and the product has started to really take off. After 5 months of growth, a big name distributor has got on board and placed a very large order that will be delivered directly to them in the next few weeks. We are projecting continued growth for both Cig2o and the ecommerce site Cig2oSore.com for all of 2011.