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RJR Sues E-Cig Maker

RJR Sues E-Cig Maker

R.J. Reynolds Tobacco Co. has filed a lawsuit against electronic cigarette maker SAS Technologies, accusing the company of infringing on its Camel and Winston brands, reported The Business Journal.

SAS Technologies does business as SaveASmoker.com and promotes and sells flavored liquid nicotine products for use with its MaxxVapor Pro e-cigarettes.

Renolds Tobacco

R.J. Reynolds tobacco products

The lawsuit was filed last week in U.S. District Court in North Carolina by Reynolds Innovations Inc., a subsidiary of R.J. Reynolds Tobacco Co., which is itself part of Reynolds American Inc.

Reynolds Innovations claims that SaveASmoker.com is selling “E-Liquid” products with names such as “Camell Tobacco” and “Winston” among the different flavors of liquid nicotine products, the report said.

According to the lawsuit, Reynolds Innovations believes that the use of the Camel and Winston names and images “is likely to cause confusion, mistake or deception among consumers as to the source, origin or sponsorship of such products.”

Reynolds Innovations is seeking the recover damages from the unauthorized use of the Camel and Winston names and images and all of the profits SAS Technologies generated from the products, said the report.

As of Nov. 5, the flavors targeted by Reynolds Innovation had been removed from Ozark, Ala.-based SaveASmoker.com, the newspaper said.

The legal action comes at a time when Reynolds American is entering the e-cigarette market with its own product, named Vuse, which will be produced by subsidiary R.J. Reynolds Vapor Co., the Business Journal added (see Related Content below for previous CSP Daily News coverage).T

The company plans to share more about Vuse during an Investor Day presentation next week, said the report.

 
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Posted by on November 6, 2012 in Tobacco News

 

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Behind Cigarettes’ Brands

Newport Non-Menthol continues to hang in, Marlboro’s promotions will keep building share and Pall Mall’s performance is increasing, according to retailers in the latest UBS-CSP Tobacco Survey.

Marlboro Cigarettes
Packs of Marlboro cigarettes

As revealed in last week’s CSP/Tobacco E-News, retailers in the survey, representing 50 chains and nearly 8,000 stores, expect Philip Morris USA‘s Marlboro to take the lead in gaining market share in the upcoming year.

When asked, however, if they thought the company’s Marlboro Leadership Price (MLP) promotion helped the brand’s share trends in 2011, there was a pretty even mix of yes (48%) and no (51%) answers. (The program, implemented last year, in essence, asks operators to forgo part of their typical markup in exchange for incentives).

Retailer responses included:

“I’m in a fair trade state and was already selling at state minimum. Made zero impact on my numbers.”

“The price strategy of closing the gap of the premium to discount encourages trade-up by consumers.”

Nik Modi, UBS analyst, pointed out that not everyone signed on to the program, estimating about 60% to 70% participation. So, he said, the 48% means “that almost anyone who has signed it is seeing some kind of market share progress.”

For Lorillard Inc.’s Newport Non-Menthol, retailers were also evenly split, with 50% on each side of whether the brand has shown year-over-year growth. “What’s interesting to me,” Modi said, “is the price increase and reductions in the buydown, and the brand is still kind of hanging in there. … It looks like it has more staying power than maybe some people predicted.”

Responses included:

“Newport N/M is being retailed as a fourth-tier product with a premium tier name badge. As we all know in this business, price sells.”

“It was growing steadily since launch. When they took pricing it dropped down two straight months. Since then it has gradually been increasing, but has not again reached its highest pre-increase level.”

Camel Cigarettes
Camel cigarettes packs

For R.J. Reynolds Tobacco Co., 25% of the retailers expect Camel to gain more market share than Marlboro or Newport. Meanwhile, the majority of the retailers (55%) said the company’s Pall Mall brand has shown an increase.

Modi said the Pall Mall responses were better than he expected, but added that he sensed the brand is “still under pressure,” as it makes most of its volume gains in lower-income regions, where PM USA has stepped up promotion of its L&M brands. To his point, one retailer said “L&M discounts have eaten into Pall Mall sales in the last quarter.” Meanwhile, another said RJRT is increasing share because “they are deep discounting Pall Mall and this brand has more awareness than L&M.”

Another retailer pointed out an additional reason for growth in the brand. “Due to the large decline in jobs in this area, there has been a large increase in lower price tobacco product sales. I expect this will continue until the economy improves.”

 
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Posted by on January 26, 2012 in Tobacco Facts

 

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