LOGIC's New President: E-Cigs 'Incredible Opportunity'
Published in CSP Daily News
Former Altria VP discusses appeal of new segment, entrance of 'Big Tobacco' into the space
LIVINGSTON, N.J. -- With more than 18 years of experience at Altria under his belt, overseeing the sales and distribution of a variety of tobacco products, LOGIC Technology's recently announced president Miguel Martin is excited to dive the into uncharted waters of electronic cigarettes. In an exclusive interview with CSP Daily News, Martin shared his thoughts on the appeal of both LOGIC's electronic cigarettes and the segment as a whole.
"There are several things that are appealing about the electronic cigarette segment," he said. "It has a lot of similarities exceptionally to conventional cigarettes… [however], unlike traditional cigarettes, which are declining, electronic cigarettes are rapidly growing in volume and consumer awareness. I think it's an incredible opportunity in this category that's already over $1 billion in a very short period of time."
He continued, "The proposition of an electronic cigarette is very compelling for an adult consumer. Cigarette smokers particularly are very aggressively looking for alternatives. Whether that's smokeless products, NRTs [nicotine replacement therapies] or e-cigarettes, I believe that's going to continue. Whether it's ultimately bigger than cigarettes, others are probably at a better place to assess the size of the category. Regardless, growth will be explosive, probably unlike any other consumer category that's this size."
Martin feels especially confident in Livingston, N.J.-based LOGIC's ability to continue to grow its share of this market--thanks in part to promising numbers from recent Nielsen and Wells Fargo reports; however, he also believes that LOGIC will continue to grow thanks to retail-friendly margins and strong repeat purchases.
Still, with Martin's former company, Altria, recently throwing its hat into the e-cig ring with NuMark--and Lorillard and R.J. Reynolds already amping up their blu and Vuse offerings--retailers and analysts alike are questioning how many independent e-cig companies can truly thrive with "Big Tobacco" in the mix.
"I think it's going to be a big category," countered Martin. "I think there's plenty of opportunity in the retail environment, in the wholesale environment, to have multiple high-quality brands. At the end of the day, the consumer's going to decide."
In fact, like many successful e-cig manufacturers, Martin believes that the entrance of the major tobacco companies into the segment will ultimately be a good thing.
"I welcome the competition from anybody--whether it's the majors or somebody else," he said. "Inherently, as consumer awareness grows and as the category evolves over time, that will be good for the category. I think there's plenty of room for [a company] like LOGIC to be successful."
According to Martin, the data already shows LOGIC's ability to succeed in the face of stiff competition: the company showed solid growth in both dollar and unit sales last year, despite the fact that Lorillard entered into the category with blu eCigs during that same period of time.
"It's what you want to see in a brand; it's consistent growth even though during that time you have a lot of effort and a lot of money being spent by other e-cigarette brands," he said. "LOGIC--with the quality of the product, with the retail margins, with the wholesale margins and strong repeat purchases--has every indication that, regardless of the competition, it's going to do well."