Blu Sales Volume Decreases 40 Percent
At the precipice of an expected merger with Reynolds American, Lorillard has announced that the revenue of the Blu e-cigarette brand dropped 40 percent in the fiscal quarter ending September 30. According to Lorillard CEO Murray Kessler, the Blu brand “faced a dramatically heightened e-cig competitive environment, highlighted by two new national competitive product launches and their associated “free trial” promotions during the quarter.” Reportedly, the Blu brand experienced an operating loss of $14 million for the quarter out of $38 million gross earnings.
In addition, Lorillard reported that the sales volume of their traditional cigarette products has declined 2.1 percent, to 10.2 billion cigarettes. In spite of this, the company’s revenue from cigarette sales increased by 1.6 percent because they simply raised prices to make up for the decrease in demand.
Lorillard still expects its merger with Reynolds American to be complete by next year although the merger has yet to receive regulatory approval. At that time, Reynolds-Lorillard will sell the Blu e-cigarette brand to Britain’s Imperial Tobacco. Presumably, Reynolds will then focus on its own Vuse e-cigarette brand.
Our post about the Vuse e-cigarette has recently been among this website’s most popular articles, with crowds of people clamoring for coupons in spite of a big red box at the top of the page explaining that we have nothing whatsoever to do with Reynolds American. If this attention suggests anything, it would seem to be that people have no problem buying their e-cigarettes from Big Tobacco — in fact, many would prefer to do so — nor do they have a problem with buying from a company that wants the government to ban their competition.