Collection: Cheaper Than Cigarettes
One of e-cigarettes biggest advantage over traditional cigarettes is its price. Because e-cigs don’t contain any tobacco, they are currently only subject to sales tax instead of the hefty cigarette tax and state tax to which conventional cigarette products are subject. As e-cig manufacturers try to lure consumers away from conventional cigarette products and create new consumers, they hard sell the lower cost of vaping on their packs, displays, and in their promotional materials.
E-cigs are sold in the following pack sizes: single disposables, pack of 3 disposables, a pack of 5 e-cigs, and starter packs that includes a rechargeable pack, rechargeable batteries and at least 5 flavor cartridges. Manufacturers claim that each e-cig is equivalent to 1-3 packs of conventional cigarettes. An advertisement for Metro e-cigarettes suggests savings by stating that an e-cig is equal to three packs of conventional cigarettes. A blog for Blu e-cigs claim that those who switch from conventional cigarettes to e-cigs can over the long term see a savings of 50% with e-cigs. 21st Century Smoke claims that a 6 pack of Express cartridges is equivalent to 6 packs (each pack containing 20 cigarettes) of traditional cigarettes. According to the website, the cost of 6 packs of traditional cigarettes is approximately $ 300 while a six-pack cartridge of 21st Century Smoke is $ 15.99._
To encourage customers to discover their savings, many e-cig manufacturers and retailers offer a cost comparison between traditional cigarettes and e-cigs and some even have a savings calculator that lets the individual determine savings after taking into account how much the individual pays for a pack of cigarettes and how much they smoke a day. There are also several Apps that consumers can download on their phones that will estimate their savings by switching to e-cigs. However, these savings calculators do not provide a complete picture. For instance, they do not calculate the cost that vapors spend every month on buying vape juice, batteries or accessories.
The e-cig industry is built on the dynamics of the razor/razorblade model. As per this business model, the industry offers consumers their starter-kits and rechargeable packs at a lower rate but makes money by keeping consumers coming back for e-nicotine juices, batteries and specialized accessories. It is in selling these flavored cartridges, replacement batteries and accessories that e-cig manufacturers make the most money. For instance, a pack of five cartomizers from NJOY costs $ 21.99 while the total cost of 5 NJOY cigarettes is only slightly more at $ 29.99. A Fin e-cig starter case, which consists of a rechargeable battery, a flavored cartomizer, and a USB charger costs $ 15.99, the same cost as a pack of 5 Fin cartomizers. In employing this strategy and charging a premium for flavored cartridges, e-cig manufacturers are basing their pricing strategy on the premise of brand loyalty. Of course, for many this is a winning strategy.
But e-cigs are designed to accept flavor cartridges and vape juice prepared by any manufacturer. The downfall to using the razor/razor blade strategy as has been seen in the printer-ink business (people often buy cheaper ink cartridges for brand- named printers) consumers can choose to fill their more expensive Blu or NJOY e-cig cartridge with cheaper vape juices.
Some other unique ways in which e-cig manufacturers advertise savings include a “home delivery” service. In this service, just as you would order monthly refills for household staples, you can pre-order monthly refills of e-cigarette cartridges. SouthBeach Smoking and Eversmoke, two e-cigarette manufacturers that offer this program, offer a 20% discount to customers for sign up for this loyalty program. Of course, while it offers savings for the individual, it is also a great ploy to build brand loyalty and gain the higher margins from repeated sales of the more expensive e-cig cartridges. _
Other savings that e-cig manufacturers promote in their promotional materials include the savings incurred by not having to buy room fresheners to remove smoke odor from indoor spaces, money saved by not having to buy chewing gum to freshen a smoker’s breath, and gas savings because e-cigarettes last longer than a conventional cigarette.
