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ELFBAR is a rapidly rising brand in the global e-cigarette market. What is it doing right?
Before answering this question, let’s review what phenomenal brands have emerged in the global e-cigarette market in recent years.
Brand 1: JUUL, using the fast-moving consumer goods model to seize consumer awareness.
Brand 2: PUFF, seized Shenzhen’s supply chain resources with huge orders.
Brand 3: ELFBAR, using the distribution model to seize distributor resources and internalize the supply chain.
JUUL was launched in 2015. In less than two years since its launch, its popularity has soared. Although JUUL is currently under strict supervision by the US government and the market has shrunk sharply, JUUL has greatly improved consumers’ awareness of e-cigarettes.
Before JUUL, there was a brand called BLU, which had already done well in the offline channels in the United States. JUUL saw the possibility in BLU. JUUL improved products on the basis of BLU. JUUL not only made products in the form of Improved, but also applied and promoted nicotine salt technology, and quickly copied BLU’s business model, and thus quickly seized consumers’ awareness of e-cigarettes.
In 2019, PUFF was born. Like JUUL, PUFF is also manufactured in China. Shenzhen, China has the most complete e-cigarette industry chain in the world. 90% of the world’s e-cigarettes are produced in Shenzhen. The rapid development of PUFF is to seize two historical opportunities:
First, JUUL has educated American e-cigarette users, and American distributors also need more convenient e-cigarette as fast-moving products. At the same time, the US FAD proposed a ban on fruit flavors, but there is no mention of disposable e-cigarettes in the decree. So PUFF chose disposable e-cigarettes.
Second, the e-cigarette supply chain in Shenzhen saw a large influx of capital from 2018 to 2019, the industry’s production capacity increased rapidly, and the competition in the supply chain became fierce. In addition, in 2019, the China Tobacco Administration issued an order to ban the online sale of e-cigarettes, resulting in overproduction of e-cigarettes.
Based on the above two conditions, PUFF placed a large order in time, making the e-cigarette factory like a savior. From the end of 2019 to the first half of 2020, almost all microphones and battery accessories in Shenzhen were covered by PUFF, and PUFF quickly seized Shenzhen’s complete supply chain resources and became the largest owner of the e-cigarette industry.
PUFF adopted a distribution policy in the U.S. market to rapidly expand its market share. At the same time, it used large orders to suppress the material prices of the Chinese industrial chain and took advantage of the payment cycle of suppliers to achieve astonishing development speed.
By 2022, the global e-cigarette market will suddenly become dominated by ELFBAR. Our customers, whether they are from the United States, Europe, Russia, Ukraine, and the Middle East, are asking if we have ELFBAR? Sorry we don’t. However, as a fast-growing e-cigarette brand, what has ELFBAR done right?
First of all, ELFBAR has seen the success of the PUFF distribution model. With the distribution model, you can quickly open up the e-cigarette market in any country in the world. You don’t need to pay for the goods in the early stage. Which distributor doesn’t like it?
Secondly, ELFBAR has internalized production and R&D. PUFF’s model of finding a factory to manufacture is actually doing trade and branding. ELFBAR has opened its own e-cigarette factory and arranged the entire e-cigarette industry chain.
The front-end grabs the global market share, and the back-end continues to strengthen the company’s supply chain and R&D capabilities.
PUFF said: I want market share.
ELFBAR said: I want both market share and industrial chain.
What has been changed by ELFBAR?
In the PUFF era, Shenzhen’s e-cigarette factories did not have a strong negotiation advantage in cooperation with brand owners. Generally, the factory took orders from brand owners and distributors.
ELFBAR has changed this situation. It distributes goods to distributors in the early stage and supports the development of distributors. After the brand is cultivated in the market, consumers become loyal users of ELFBAR. At this time, distributors will bind the interests of the brand. It is hard to say if it is or not a long-term and benign cooperation model.
In some mature markets, ELFBAR is reaching a new balance of cooperation with distributors. At the same time, after occupying the market through ELFBAR, distributors in some countries are also considering developing their own brands, but is it easy to change consumers’ brand awareness in a short time?
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