Events that draw smokers over the age of 21 should put the electronic cigarette category on their prospect list.
Looking for a new category to target? How about electronic cigarettes?
Dollar sales in the electronic smoking device category surged 142 percent in the year ending Feb. 24, 2013, according to SymphonyIRI Group, a market research firm.
And some companies are using sponsorship to build visibility and strengthen their positioning in the highly fragmented category.
Case in point: blu eCigs has launched a new sponsorship campaign with ties to motorsports teams, music festivals and other types of events.
The three-year-old company kicked off the campaign with a tie to the Rahal Letterman Lanigan Racing IZOD IndyCar Series team, around which it will title driver Mike Conway’s ride at the April 19-21 Toyota Grand Prix of Long Beach and cosponsor Graham Rahal for the entire season.
On the music front, blu last week titled the Electric Lounge during the South by Southwest Conferences & Festivals in Austin, Texas. The free three-day event featured music from 30 electronica and indie acts.
Blu this spring will expand its presence in the music space with a sponsorship of the May 24-27 Sasquatch! Music Festival in George, Washington.
And more deals are in the works.
“Hold on to your hats, we’re just getting started. We’re at a time of great growth and opportunity, and we want to surround ourselves with winners,” said Matt Coapman, blu’s vice president of marketing, noting that the company is having conversations “at the highest levels in music, sports, events and destinations.”
That activity is driven in part by Lorillard Tobacco Co.’s 2012 acquisition of blu. The acquisition helped expand the number of sales channels from roughly 11,000 food, drug and convenience store outlets to more than 70,000 retailers.
“Lorillard has always been a standout leader in their field, and they have brought financial, operational and logistical resources,” said Coapman.
Lorillard reported $61 million in sales from electronic cigarettes in fiscal 2012 despite having been in the category for less than year, according to the Winston-Salem Journal.
Blu launched the sponsorship campaign to gain visibility, strengthen its positioning and gain a point of differentiation from the hundreds of companies that market electronic smoking devices, said Coapman.
Specifically, blu is using sponsorship to accomplish the following objectives:
Educate smokers. Blu uses one-on-one marketing to educate smokers about electronic cigarettes and how the product works. Electronic cigarettes vaporize a liquid solution into an aerosol mist, simulating the act of smoking tobacco.
Blu products include a $10 disposable cigarette and a $60 rechargeable kit.
Sample product. In addition to educating smokers, blu uses sponsorship to sample smokers over the age of twenty one.
The company handed out several thousand disposable smokes at SXSW, said Coapman, noting that brand ambassadors use iPads to verify the age of recipients.
Promote brand positioning. Blu uses sponsorship and other marketing platforms to position its products as a premium lifestyle brand and to redefine the act of smoking.
For example, a national TV ad featuring actor Stephen Dorff plays up how blu can help smokers “take back their freedom.”
In a similar vein, the company aligned with RLL Racing to play up its style, power and technology positioning, said Coapman.
Dorff is slated to serve as an honorary pit crew member at the Toyota Grand Prix of Long Beach, said Brian Marks, RLL Racing’s vice president of corporate partnerships and marketing.
Marks—a former sales executive with Mars Chocolate—established a relationship with blu president Jason Healy at the 2012 NACS Show (National Assn. of Convenience Stores) in Las Vegas.
Develop a narrative. Similar to its TV ads with Dorff, the company looks for partnerships that help tell the story about its products and how they benefit smokers.
“We will continue to deepen our relationship to storytellers,” said Coapman.
Other players in the electronic cigarette device category include Apollo, Green Smoke, Regal, South Beach Smoke and V2.