Open system vaporizers and e-liquids now contribute more than $1.5 billion to the overall vaporizer market in the US with electronic cigarettes accounting for only $1 billion, according to data from Wells Fargo.
“Open system vaporizers are quickly gaining in consumer confidence with electronic cigarette users moving towards these more powerful, tank-style devices,” said Bonnie Herzog, managing director, senior beverage and tobacco analyst with Wells Fargo Securities.
Open system vaporizers differ from other vaporizers in that they provide smokers the opportunity to refill the system with liquid nicotine solutions. “People are moving to vaporizers because they are cheaper than disposable cigarettes, they allow you to vape longer because of a bigger tank, and vaporizers have a more powerful battery,” said Alexandre Prot, CEO with Smokio.
The fact that the sale of vaporizers and e-liquids exceeded electronic cigarette sales for the first time this year by $500 million may be because users spend 30% less when using a vaporizer as opposed to e-cigarettes. “Vaporizers typically have a higher up-front cost to the consumer but those consumers using vaporizers to quit smoking over time find they are less expensive than traditional tobacco cigarettes and electronic cigarettes,” said Scott Frohman, CEO with Vaporin Inc (VAPO) in Miami.
Sales of vaporizers have been so brisk for Vaporin that the company is now introducing a cannabis vaporizer line designed for dry herbs, oil and wax—and launching four vape shops. “We are well positioned to capture a significant share of the cannabis market that is projected to reach $10 billion by 2017,” Frohman told High Times.
With open system vaporizers, not only can e-liquid solutions be refilled, but heating elements can be replaced and batteries recharged. “Electronic cigarettes are featured in many convenience stores and gas stations nationwide but have very few flavors and nicotine strengths and the hit obtained from e-cigarettes is lacking in comparison to the conventional tobacco cigarette,” said Frohman.
Just six months ago, open system vaporizers gained 60% of all U.S. vaporizer sales with vape shops fueling the increase.
“Vape shops are setting up the e-liquid equivalent of wine tastings,” said Ata Gonzalez, CEO with GFarmaLabs, a cannabis edible company that is in the process of going public. “The uniqueness of the e-liquid and vape market will continue to evolve to provide users a smoking experience that may eventually become associated with luxury.”
Domestically, the combined electronic vaporizer market is now estimated at $2.5 billion and growing.
“The flavor alteration options are endless from strawberry to banana to mojito, which shows an artisanal growth and sense of care in the industry much like we have in the marijuana trade,” Gonzalez told High Times. Because e-liquids are stored in tiny glass vials, ingredients can be aged much like whiskey and rum are in oak barrels. “E-liquids and vaporizers are proliferating as part of a sub-culture within certain circles,” said Gonzalez.