E-cigarette And Vape Market Size, Share & Trends Analysis Report By Distribution Channel (Online, Retail), By Product (Disposable, Rechargeable), By Component, By Region, And Segment Forecasts, 2021 - 2028

Report Overview

The global e-cigarette and vape market size was valued at USD 15.04 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 28.1% from 2021 to 2028. The growing emphasis on adopting safer alternatives to smoking is anticipated to drive the adoption of e-cigarettes and vape devices over the forecast period. Amid the COVID-19 pandemic, e-cigarette and vape vendors have adopted several COVID-19 based marketing strategies to drive product sales. As the supplies of e-cigarette and vape devices became scarce in physical stores, the vendors started offering their products through online platforms and offered hand sanitizers and face masks as gifts on the purchase of vaping products. For instance, vaping brands such as One Drop Vape, BLVK, and Podsalt started offering free hand sanitizers with the purchase of their products. This served as a key factor driving the market growth during the pandemic and is expected to continue to be a key factor in the post-pandemic era.

The e-cigarette and vape market has evolved considerably since 2016 as the devices have become more efficient in terms of battery life and the number of flavors available in the market. Additionally, various types of flavors such as menthol, tobacco, fruits and nuts, and chocolate are available in the market, which is attracting a large number of customers. These flavors emit aromas when used in an e-cigarette or a vape device. Additionally, the increasing cost-effectiveness of these devices has further enhanced customer adoption and is expected to drive market growth over the forecast period.

The rising awareness about e-cigarettes being safer than traditional cigarettes, especially among the younger population, owing to various studies carried out by medical institutions and associations, is anticipated to further drive the market growth. Furthermore, the array of customization features such as temperature control and nicotine concentrations offered by the vendors is expected to aid the product demand. Furthermore, continuous improvement in new product development by vendors is anticipated to propel the market growth.

In recent years, market players have emphasized increasing the awareness about e-cigarettes and vape devices, particularly among adult smokers. For instance, JUUL Labs, Inc. embarked upon a marketing campaign in January 2019 to educate adult smokers about the ill effects associated with traditional combustible cigarettes and encouraged them to avoid the same and switch to e-cigarettes and vape devices. Such marketing initiatives are anticipated to drive market growth over the forecast period.

However, the regulations levied by local authorities across various countries such as the U.S. and India on the sale of vaping products and e-liquids have restrained the market growth. Multiple countries have banned the distribution and sale of vape products, which in turn, has led to lower sales. For instance, in September 2019, the Government of India banned manufacturing, production, import/export, sale, transport, storage, distribution, and advertising of e-cigarettes. Furthermore, stringent trading laws have made it difficult for retail consumers to import vaping devices for personal consumption. However, the vaping industry has formed various associations to counter the policies against vaping products and regularize the industry for supervision, eventually driving the growth of the market for e-cigarette and vape.

Product Insights

The rechargeable segment accounted for the highest market share of over 40% in 2020. The adoption of rechargeable devices is expected to increase as they tend to be affordable in the long run and eliminate the need to re-purchase supplies such as cartridges. Furthermore, customers making DIY e-liquids need not purchase pre-filled cartridges. Rechargeable devices can be used for a longer duration by switching the cartridges containing e-liquid. Moreover, seasoned vapers particularly find it economical to purchase rechargeable e-cigarettes and vapes, which is expected to increase their adoption.

The modular devices segment is anticipated to register a significant CAGR over the forecast period as these devices offer high-level customization options that allow users to combine different features and parts to alter the flavor and the amount of vapor generated from the device depending on personal requirements. Vendors are coming up with various device configuration and across various price ranges that enables customers to purchase their desired device at a reasonable cost is further anticipated to drive the demand for modular devices segment over the forecast period.

Distribution Channel Insights

The retail store segment accounted for the highest market share of over 80% in 2020. E-cigarettes were initially sold in retail outlets such as vape shops and gas stations. These stores helped users to choose from a wide variety of devices and e-liquids. Moreover, vape shops enabled users to try and test these devices before making the purchase decision. This is estimated to drive the growth of the retail store segment over the forecast period.

The online segment anticipated registering a significant CAGR over the forecast period. The benefits offered by online marketplaces, in terms of competitive pricing, convenience, and access to a wider variety of products, are encouraging people to purchase e-cigarette and vape online. Furthermore, websites offer a large variety of products as compared to retail stores. Moreover, sellers have their own websites from where users can purchase the products at a low price. These factors are anticipated to drive the growth of the online segment.

Component Insights

The vape mod segment accounted for the highest market share exceeding 45% in 2020. The increasing popularity of vaping competitions in countries such as Indonesia, the U.K., the UAE, and Russia has increased the sales of vape mods, which is anticipated to drive the vape mod segment growth. For instance, in April 2019, Shenzhen WOTOFO Technology Co., Ltd., a manufacturer of vape products, organized a vape tricking competition named Wotofo Vape Trick Competition 2019 in Indonesia. Such initiatives are anticipated to drive the segment growth over the forecast period.

The e-liquid segment is anticipated to register a significant CAGR over the forecast period. The introduction of various types of flavors such as fruit, tobacco, dessert, and mixed, among others, have encouraged the demand for the e-liquid segment. For instance, in March 2019, Japan Tobacco Inc. launched new flavors of tobacco capsules. The two flavors include a mixed flavor of pineapple and peach and menthol. Furthermore, the segment is expected to significantly drive the market growth owing to the Do-it-Yourself (DIY) trend where users develop their own e-liquid by combining flavors.

Regional Insights

North America dominated the global market with a share of over 40% in 2020. The extensive presence of major industry players such as R.J. Reynolds Vapor Company; Philip Morris International Inc.; and JUUL Labs, Inc. is anticipated to drive the regional market growth. Social media platforms are being used extensively for selling e-cigarettes and vaping products. The young population has largely adopted vaping devices as a safe alternative to tobacco, which, in turn, is estimated to boost the adoption of these products. However, the current ban on some e-cigarette flavors including fruit and mint flavors in the U.S. to restrict underage vaping in the country is expected to hamper the growth of the market in the region to a certain extent.

Given that most of the e-cigarettes are imported from other countries such as China, customers find it convenient to purchase e-cigarettes in bulk quantities via online platforms, which is anticipated to drive the Asia Pacific regional market growth. The Europe market is anticipated to register considerable growth over the forecast period. The health bodies in the region are providing acceptance to e-cigarette and vape from vendors such as British American Tobacco Plc’s Vype and Imperial Brands Plc’s Blu in the region as it is a better alternative to tobacco smoking is anticipated to drive the market growth in Europe.

Key Companies & Market Share Insights

The e-cigarette and vape vendors across the globe are expected to engage in aggressive social media marketing strategies to effectively maintain communication with their consumers and be in regular exchange with their dispensary partners. This is required to maintain customer-centricity and strengthen their future growth strategies. Customers are expected to shift from traditional joints to vape pens largely owing to sanitary and health concerns. Personal vaporizers help users avoid sharing e-cigarette and vape devices, which is essential in the post-COVID-19 era. This is expected to propel the market growth over the forecast period.

The industry is characterized by few entry barriers for new players as new players can establish their business with minimal investments. Competition among the players is high and large companies are pursuing various inorganic growth strategies such as partnerships, acquisitions, collaborations, and strategic agreements to increase their customer base and geographical reach. For instance, in January 2020, Philip Morris International announced its collaboration with KT&G, a tobacco and nicotine company in South Korea. Through this partnership, the former company helped KT&G in commercializing its smoke-free products outside the country. Furthermore, the market players are investing actively in the continuous improvement of products and the development of new products. For instance, in December 2018, British American Tobacco launched two new e-cigarettes called Vype iSwitch Maxx and Vype iSwitch in five of BAT’s VIP stores in London. These new products are powered by distiller plate technology to heat e-liquid. Some of the prominent players operating in the global e-cigarette and vape market are:

• Altria Group, Inc.

• British American Tobacco

• Imperial Brands

• International Vapor Group

• Japan Tobacco Inc.

• NicQuid

• JUUL Labs, Inc.

• Philip Morris International Inc.

• R.J. Reynolds Vapor Company

• Shenzhen IVPS Technology Co., Ltd.

• Shenzhen KangerTech Technology Co., Ltd.

E-cigarette And Vape Market Report Scope

Segments Covered in the Report

This report forecasts revenue and volume growth at the global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2028. For this study, Grand View Research has segmented the global e-cigarette & vape market report based on product, component, distribution channel, and region:

• Product Outlook (Volume, Million Units; Revenue, USD Million, 2016 - 2028)

  • Disposable

  • Rechargeable

  • Modular Devices

• Component Outlook (Volume, Million Units; Revenue, USD Million, 2016 - 2028)

  • Atomizer

  • Vape Mod

  • Cartomizer

  • E-liquid

• Distribution Channel Outlook (Volume, Million Units; Revenue, USD Million, 2016 - 2028)

  • Online

  • Retail

    • Convenience Store

    • Drug Store

    • Newsstand

    • Tobacconist Store

    • Specialty E-cigarette Store

• Regional Outlook (Volume, Million Units; Revenue, USD Million, 2016 - 2028)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

  • Asia Pacific

    • China

    • South Korea

    • Japan

  • Latin America

    • Brazil

  • MEA