Big Tobacco may not be dying after all. Lorillard (LO), the tobacco giant behind Newport and Kent brand smokes, is now getting almost 4 percent of its revenue from electronic cigarettes.

The North Carolina based company says its Blu e cigarette brand posted $63 million in sales in the recent quarter, a brisk trade that helped push Lorillard s total sales up 10 percent, to $1.8 billion. The company estimates that it now holds about half of the U.S. market for e cigarettes, which heat a liquid cocktail of nicotine to create a smokeless vapor. Its e cig sales have risen almost fivefold in the past year thanks to a national TV advertising campaign featuring Jenny McCarthy and strong repeat purchases, Lorillard says.

Wells Fargo (WFC) pegs the global market at $2 billion and estimates it will top $10 billion by 2017. Bloomberg Industries projects that at their current pace, e cigarette sales will surpass those of traditional smokes by 2047.

Although the Blu brand is the most popular e cig product in the world, according to Lorillard, the company is also building its line of e cigarettes abroad. Earlier this month it bought British brand Skycig for $49 million in cash.

Lorillard, which has a cigarette R&D team in Silicon Valley, has actually been selling more traditional smokes lately. It moved almost 10.5 billion fire fueled cigarettes in the recent quarter, 3.5 percent more than a year earlier, and has even been charging more for its old fashioned tobacco products. But the company also had to fork over $79 million in damages tied to a decade long product liability fight in Massachusetts, and regulators are still questioning the harm of Big Tobacco s menthol offerings.

I still think we re looking at an industry that s declining, Lorillard Chief Executive Officer Murray Kessler said on a conference call this morning. While there s plenty of debate about the safety of e cigarettes, if they can help big tobacco companies avoid or at least offset massive one time costs from lawsuits and regulatory battles, investors will be cheering.

Much will depend on how hard of a line the government takes on e cigarette rules, which are being hammered out now. If the FDA does overly strict regulations and reads it just like cigarettes you re going to get a different trajectory in the category than you re going to get if they recognize, again, that this is somewhat different on the continuum of risk, Kessler said.

For the time being, smokeless cigarettes play an important part in Lorillard s comprehensive tobacco harm reduction strategy, as Kessler termed it. That s harm reduction for shareholders and possibly smokers as well. marijuana in lucky strike

Discount cheap cigarettes – 18$ marlboro carton
Yet no matter how many forms the belief takes, it is nothing but wishful thinking. Lucky Strike gained its name as a reference to the Gold Rush days, when prospectors who happened upon great riches were said to have made a “lucky strike.” By selecting this particular name for the product, its manufacturers implied consumers who chose this brand of tobacco were themselves making a “lucky strike” in the form of happening upon a fine product. (Throughout its history, Lucky Strike drew upon similar marketing sleight of hand to build belief that it was superior to its competitors. Early advertising campaigns proudly trumpeted “It’s toasted!” as if what was being proclaimed was a noteworthy aspect peculiar to that one brand when in fact all tobacco used in cigarettes was “toasted.” And in the 1940s when it altered the look of its cigarette pack to make the brand more popular with women, a growing segment of the smoking population, it positioned the redesign as part of the war effort Consumers were told “Lucky Strike Green Has Gone to War!” by doing away with its former green packaging and so preserving those verdant dyes for use by U.S. Army an explanation that was pure humbug.)

In 1903 Lucky Strike was sold to W.T. Blackwell & Company of Durham, North Carolina, and in 1905 it was acquired by the American Tobacco Company. American began manufacturing the Lucky Strike cigarette in 1917 to challenge Camel for its share of that market.

Although Lucky Strike lacks any connection to self medicating with marijuana, at one time it was positioned as a diet aid. The brand was the first to connect smoking to weight loss with an advertising campaign targeted to women that advocated lighting up as the way to combat sugar cravings. In the 1920s and 1930s, ads for the cigarette told women “When tempted, reach for a Lucky instead you will thus avoid overindulgence in things that cause excess weight.” That campaign worked “Reach for a Lucky instead of a sweet” was associated with a 200 percent increase in market share.

Barbara “a 200 percent increase in other things can be gained by reaching for your sweetie instead of a Lucky” Mikkelson

Last updated 26 May 2011

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