Reynolds, With an Eye on Juul, Wades Into Social Media -- Update

Date : 05/15/2019 @ 11:06PM
Source : Dow Jones News
Stock : British American Tobacco Plc (BATS)
Quote : 2885.5  -32.0 (-1.10%) @ 4:35PM
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Reynolds, With an Eye on Juul, Wades Into Social Media -- Update

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By Jennifer Maloney 

One of the biggest U.S. tobacco companies has started marketing its e-cigarettes on Twitter and Instagram, seeking to regain market share lost to upstart Juul Labs Inc.

The ads and social-media accounts for Vuse e-cigarettes, from Camel and Newport maker Reynolds American, launched Wednesday. They come less than a year after Juul pulled back its U.S. social-media marketing amid concerns that it had targeted teenagers.

Reynolds executives say they are taking measures to prevent people younger than 21 from seeing the posts. The move, part of a broader marketing campaign for Vuse, marks the first time the U.S. subsidiary of British American Tobacco PLC has ever used social media to market its products, executives said.

Vuse was the U.S. e-cigarette market leader in 2017 before Juul's sales surged, upending the industry. The startup's flash drive-shaped vaporizer, with nicotine-laced liquids in flavors such as mango and cucumber, looked and felt nothing like the cigarette-like devices offered by Reynolds and other big tobacco companies. Juul became a status symbol among young people and contributed to a 78% increase in vaping among children and teens in the U.S. from 2017 to 2018.

Reynolds is responding with a product called Vuse Alto, a rectangular vaporizer whose refill pods contain more liquid than Juul's and come in menthol, mixed berry and tobacco flavors. The company ran its first television ad for Vuse in March and in April put coupons for Vuse Alto on packs of Camel Crush cigarettes. Juul accounted for 75% of e-cigarette sales in stores tracked by Nielsen in the four weeks ended April 20, while Vuse represented 14%, according to Wells Fargo.

Vuse will restrict its online followers to people who identify themselves to Facebook, Instagram and Twitter as at least 21 years old, Reynolds said. In addition, the tobacco company has contracted an outside firm to scrub Vuse's followers daily, removing fake accounts and people under 21, the company said. Every post will contain a warning that nicotine is addictive, resembling the labels on e-cigarette packaging.

"We certainly have learned what not to do from the way our competitors have done social media," Christy Canary-Garner, vice president of consumer marketing for Vuse Vapor at Reynolds, said in an interview. "We believe social media can be used and will be used in the right manner by Reynolds."

Marketing on television, radio, billboards and social media isn't allowed for traditional cigarettes. By contrast, there are few regulations for e-cigarette marketing. The Food and Drug Administration in April published marketing guidelines it said would apply to alternative tobacco products such as e-cigarettes that over the next few years must submit applications to the agency to remain on the market.

Reynolds didn't consult with the FDA on its social-media protocol. The FDA's guidelines call for age restrictions, suggest using images of adults 35 and older, and warn against marketing that makes a tobacco product look cool. The Vuse campaign launching Wednesday depicts products, not people, the company said. Reynolds declined to say how much it is spending on the campaign.

Matthew Myers, president of the Campaign for Tobacco-Free Kids, said he doesn't think the FDA's new guidelines go far enough but said it is possible to responsibly market e-cigarettes on social media. It would require age protections as well as "strict limitation on images and text, " he said.

Juul's early advertising pitched the brand as a cool lifestyle accessory with images of people in their 20s and 30s, which critics said made vaping attractive to teens. The startup has said it never targeted teens. Last year, Juul stopped using models and social-media influencers.

In November, Juul shut down its Facebook and Instagram accounts in the U.S. It also curbed its presence on Twitter to customer service and corporate communications, and said it would use YouTube for posting testimonials of former adult smokers. Its marketing now features former smokers in their late 20s or older who have switched to Juul.

Reynolds says it has never used social-media influencers to promote its products. Marlboro maker Altria Group Inc., which pulled its own MarkTen e-cigarettes from the market last year before investing $12.8 billion in Juul, has a policy against using social media or influencers, a spokesman said.

Write to Jennifer Maloney at jennifer.maloney@wsj.com

 

(END) Dow Jones Newswires

May 15, 2019 17:51 ET (21:51 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.
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