Global E-Cigarette Market (by Product Type, Category, Composition, Distribution Channel, & Region): Insights and Forecast with Potential Impact of COVID-19 (2022-2027)
E-cigarettes are battery-powered electronic cigarettes that are less harmful than regular cigarettes. These cigarettes, also known as e-cigs, e-vaping devices, vape pens, and electronic cigarettes, are made up of three primary components: a heating coil, a battery, and an e-liquid cartridge. These components aid in the delivery of vaporized nicotine or flavoured solutions to the users.
The emergence of flavored e-cigarettes, as well as the launch of low-cost HNB products, rising government initiatives to implement indoor smoking bans, and rising demand for different flavors and open vape systems by the young population are some of the other factors that are likely to drive the market growth for injectable in coming years. The global e-cigarette market is estimated to reach US$28.24 billion in 2023, progressing at a CAGR of 17.65%, during the forecast period.
- By Product Type: According to the product type, the global e-cigarette market has been categorized into three different segments: Modular, Rechargeable and Disposable. The Modular segment held the maximum share of the e-cigarette market. Wide adoption of modular devices by users as these devices have larger batteries and hold more e-liquid, rising awareness campaigns about health risks along with prohibitive taxation to curb tobacco use, and new product innovations would support the e-cigarette product market growth.
- By Category: In terms of category, the market report bifurcates the global e-cigarette market into two segments: Heat not Burn (HNB) and Vape. The Heat not Burn (HNB) segment held the largest share in the global e-cigarette market. Rising demand for possibly Reduced Risk Products (RRPs,) and rising taxation on tobacco products by government in various nations are the primary growth factors that would help in the expansion of Heat not Burn (HNB) market.
- By Composition: The report splits the global market into two segments on the basis of composition: Nicotine and Non-Nicotine, where the Nicotine segment accounted for highest share in global e-cigarette market. Growing preference for electronic cigarettes on account of low cost and fewer negative effects on the health and increasing number of millennials who prefer tobacco smoking are some of the factors anticipated to drive the demand for nicotine based e-cigarettes.
- By Distribution Channel: The report segmented the global e-cigarette market in the four distribution channels: Tobacconist, Vape Shops, Online and Others. Tobacconist channel held the dominating share of the e-cigarette market. Tobacconist distribution would develop in the future because these shops sell a large amount of cigarettes that are damaging to people's health, thus tobacconists can convey information directly to customers to use e-cigarettes and increase demand for the e-cigarette market in the future.
According to this report, the global e-cigarette market can be divided into five major regions: Asia Pacific, North America, Europe, Latin America and Middle East and Africa. The countries covered in Asia Pacific region are the China, South Korea and Rest of Asia Pacific, while North America includes the US and Mexico. Moreover, Germany, UK, France, Spain, Italy and Rest of Europe are included in the Europe region.
The North America e-cigarette market enjoyed the largest market share, primarily owing to the individuals' increased knowledge of the hazardous effects of traditional cigarettes. While the US continues to be a prominent region of North America’s e-cigarette market, accounting for the increasing awareness of safer tobacco alternatives and rising demand for smokeless vaping in the region. Availability of e-cigarettes in more than 4000 flavors and increased customer acceptance due to cost-efficiency of these devices were the major factors responsible for the growth of e-cigarettes in the US.
Top Impacting Factors:
- Changing Consumer Perception Towards Combustible Cigarettes
- Upsurge in Working Population
- Growing Popularity of E-Cigarettes
- Peer Influence on Youngsters
- Stringent Regulations
- Surging Concerns Over Side Effects of E-Cigarettes and Vapor Products
- Upswing in Gen Z Income
- Increasing Influence of Social Media
- Rise in Technological Developments by E-Cigarette Manufacturers
- Driver: Upsurge in Working Population
A huge demand for e-cigarettes comes from people falling in the 15-64 years age brackets. This is because this range of demographics consists of people with diversified tastes, high purchasing power and exclusive preferences. As the lifestyles are centered around work and offices, stress and anxiety levels are growing among working individuals, which leads to growing consumption of stress relieving agents such as nicotine. Moreover, e-cigarettes can be used indoors as these do not do not produce tar or carbon monoxide, two of the most harmful elements in tobacco smoke. Thus, an upsurge in working population indicates increase in demand for e-cigarettes, which in turn, provided a boost to the overall market growth.
- Challenge: Surging Concerns Over Side Effects of E-Cigarettes and Vapor Products
Side effects caused due to the use of e-cigarettes and vapor products are acting as a restraining factor on the e-cigarette market. E-cigarettes and vapor products contain harmful chemicals and toxins that have health risks. The chemicals and toxins may cause serious health problems, including cancer. In 2019, an outbreak is occurring in the U.S. of a very serious lung disease associated with the use of vaping devices. The specific cause of this outbreak has yet to be determined, it is unclear whether the outbreak is caused by e-fluids that contain nicotine/THC or whether the harmful products were purchased “off the street” or in retail outlets. The side effects of using e-cigarettes and vapor products also include nausea, vomiting, abdominal pain, itchiness, dry eyes, cough and nosebleeds. Some of the side effects are caused due to the body’s resistance to accept vapor and may take a few days to disappear. These side effects are limiting the use of e-cigarettes affecting growth of the market.
- Trend: Increasing Influence of Social Media
Social network is a forum which simplifies the transfer of information on any related issues, enables small, large and emerging businesses to reach target customers more easily. Users are checking social media feeds regularly and bloggers, influencers are finding the latest trends and advertising products. Customers are not limiting social media platforms to inspiration, they are also shopping through social media platforms. Social media is also being increasingly used to create awareness related to health benefits of switching to e-cigarettes and vapor products from combustible smoking. This has risen the accessibility and reachability of individuals towards different brands, thereby increasing the demand for e-cigarettes, which is estimated to help in the market expansion in coming years.
The COVID-19 Analysis:
Due to the COVID-19 pandemic, the global e-cigarette market witnessed a sharp decline. The pandemic forced people to pay attention to their health and quit habits like smoking in order to tackle this situation. Thus, it impeded the demand for e-cigarettes throughout the pandemic period. Further, retail stores and outlets also stopped offering their products in order to abide by the government rules, which hampered the growth of the e-cigarette market. On the contrary, the ease of lockdown restrictions has increased the sales of e-cigarettes like before.
Analysis of Key Players:
The e-cigarette market is concentrated with the presence of few number of players dominating worldwide. Key players of the e-cigarette market are:
- British American Tobacco PLC,
- Altria Group Inc.,
- Imperial Brands PLC,
- Japan Tobacco Inc.,
- J WELL France,
- Turning Point Brands Inc.,
- Shenzhen IVPS Technology CO. Limited
- NJOY Inc.
In September 2020, Japan Tobacco Inc. announced its partnership with Sauber Engineering AG, a prototype and technology developer. Through this partnership, the companies would continue to collaborate on developing engineering projects to increase the performance of Japan Tobacco Inc. products.