A Look into the Growing Vaping Industry

Oliver Norman, Content Marketing Manager, EDGE Vaping

The vaping industry has become a juggernaut of commerce worldwide, growing from an enigmatic technology circa 2010 to a global phenomenon by 2017. From humble beginnings, vaping is now being recognised as a potentially powerful tool to help adult smokers quit.

While smoking cessation is a very common reason people choose to pick up a vaping device, there are just as many who are simply looking to substitute cigarettes for an alternative. Vaping has been hailed by Public Health England as 95% less harmful, making it a particularly suitable substitute.

Whatever the reason, consumers have flocked to vaping in droves over the years. 7-8% (depending on the study observed) of the UK population now vape, which equates to around 3.2 million people.

While the industry’s growth has been fast-paced and lucrative, it has not been free of challenges. As with any new technology, the general public has had many different questions about health and safety, and vaping’s effectiveness as a cessation tool.

Some of these questions are now being answered; data is now mounting in favour of vaping as a method of tobacco harm reduction, as evidenced in the last two government reports on the subject. However, there are still many unanswered questions that simply cannot be addressed accurately until long-term data becomes available.

Despite this, the retail power of vaping products continues to grow, and is worth watching. Potential legislature changes following the rise of disposable vapes among young people, and shifting consumer behaviour in the wake of the cost of living crisis, have the potential to change the landscape once again in 2023/2024.

Looking Back at 2022

2022 was a dramatic year for vaping. 2021 saw the introduction of disposable vapes onto UK shelves. Their unbelievably fast rise to market dominance created some unique waves throughout the industry, both good and bad.

As a result, we saw sales of traditional vaping products dip, while pre-filled disposable units soared – a trend that was only bucked in December ’22. This trend only grew as many consumers found themselves on the back-foot financially at the behest of the cost-of-living crisis, cemented by a perfect storm of Brexit bumbling, political in-fighting, fallout from the COVID-19 pandemic, and the war in Ukraine.

The Rise and Fall of Disposable Vapes

Disposable vapes arrived in the UK offering consumers the single most convenient way to vape we have ever seen. The devices were bright and attractive to look at, tough on cravings but easy on the throat with strong yet smooth nicotine salt e-liquid, and an unbelievable range of flavours from mundane offerings to sweet and fruity combinations.

Because they are single-use and pre-filled, there is no coil to faff with and no potentially messy refilling process – users simply puff, and bin. This resonated with consumers in a big way, allowing disposable vapes to claim a 90% market share by unit sales by November ’22.

Sales of bottled e-liquids and rechargeable devices like those sold by EDGE Vaping initially remained flat. Data suggested that this massive spike in vaping retail was exclusive to disposable vapes; these consumers had never used other vaping products before, meaning the unit sales could be attributed to non-smokers or vapers. This is a moral concern in of itself – if you have never smoked or vaped, you should not start- but also indicates a problematic rise in young people picking up the habit.

Disposable vape sales were driven by the convenience sector, with smaller stores reacting to demand by introducing as many disposable devices as they could, as quickly as possible. This led to problems – importers began flooding the market with illegal, untested variant products that do not meet the legal safety standards all UK vaping products must be held to.

While the insane demand for disposable vapes presented a massively lucrative option for retailers, their rise finally halted in December ’22. While there is still some room to grow in terms of their distribution, most retail locations now offer at least one kind of disposable vaping device, and this means they will struggle to gain further reach. There is also a shift in consumer perception to take note of, which is contributing to their more recent decline.

Faith in these devices has been rocked for a number of reasons:

Illegal importation and sale of unregulated versions of disposable vapes that do not comply with UK safety standards. These devices frequently exceed legal safe limits placed on both nicotine content and e-liquid volume (as seen in recent headlines).
Massive stock seizures and investigative actions by Trading Standards across the UK in an attempt to protect consumers and educate retailers on compliance.
The devices are made from wholly non-recyclable parts. They are being littered extensively, and those that are disposed of correctly are taken to landfill. This means that enough lithium to produce 1,200 electric cars is being lost forever each year.
A significant youth access issue is still building. Underage children are being motivated by social media such as TikTok and their peers to get their hands on trendy vaping devices. It has been stated that one in five 15-year-olds are now using disposable vapes.
Children can purchase devices from a number of different places. As well as smaller retailers and markets, large supermarkets have been identified as a source of underage sale.

The result of these scandals has begun to have a bigger impact on buyer behaviour, and set the scene for a stronger year for traditional vaping products in 2023.

Following the most recent public exposure of a leading disposable brand for breaching safety regulations, stock removal has left big gaps in vape retail outlets across the nation, which could spark a competition amongst other leading brands to claim that space for themselves.

Cost of Living Grips the Nation

Economic struggles played a major role in the vape industry’s performance in 2022; in many cases, the cost of living crisis made even the essentials impossible to afford.

This includes factors like:

Inflation on groceries because of resource shortages in Ukraine as the conflict with Russia rages;
mounting fuel price;, and
national shortages of imported goods because of a weakened post-Brexit infrastructure.

These concerns have combined to bring families that were already struggling to recover from the pandemic to their knees.

The result was that consumers shopped around much more. For many, dropping vaping products altogether was the only option, as 33% of shoppers could only just afford the basics. Discounters offering low-cost disposable vapes performed the strongest throughout the latter half of 2022, but even they saw customers’ average spend decrease.

Over 54% of people asked on the Vyper consumer app confirmed they had bought less e-liquid in November and December to prioritise other spending.

What’s in Store for 2023

This year, we are seeing some positive trends for growth in the vaping industry. While disposable vapes seem to be taking their first downturn in 18 months, bottled e-liquids and traditional vaping devices and pods are on the rise, showing that finances may be stabilising for consumers following the worst Christmas dip in at least 3 years.

Discount stores are proving themselves to be a big influence in the vaping scene, showing incredible fluctuation in sales as consumers flit between them looking for the cheapest way to vape. This is showing no sign of changing as of yet; with the energy price cap being removed in the coming weeks, consumers are still looking to save.

Consumers Eyes are Wandering

The disposable vaping scandals that have amassed since 2021 are now taking root and influencing consumer behaviour – as we can see, more consumers are now willing to move to a reusable pod system provided it offers comparative convenience.

New brands have boosted the growth of pod systems, including non-disposable products by previously disposable-only brands. These have created a feeling of familiarity that has made it easier for consumers to drop the hyper convenience of disposables for something with more longevity, and ultimately more cost-effective.

Brand loyalty is at an all-time low, however, with price point and product type playing the biggest role in driving sales. While all vaping categories are showing growth again this year, pods are the standout, as they offer a balance of cost and convenience that seems to resonate with the bulk of consumers. Retailers should bear this in mind – disposables are dipping, pods are lifting, so stocking these (and a healthy selection of 10ml nic salt fruit flavours) are a solid bet for profit in 2023.