May 17, 2021 at 09:02PM https://ift.tt/3eRsppC Jamie Ducharme
On June 7, North Carolina attorney general Josh Stein will enter a Durham courtroom with a mission: proving that the e-cigarette company Juul Labs purposely targeted teenagers with its nicotine-rich products.
If Stein—who in 2019 became the first state attorney general in the U.S. to sue Juul—is successful, the vaping company may be in for a world of hurt. Hundreds of lawsuits against Juul, many of which were consolidated into multi-district litigation in California, are pushing allegations mirroring Stein’s. They claim Juul purposely designed its stylish, flash-drive-like devices and flavored nicotine e-liquids to appeal to teenagers. The product launched with a flashy marketing campaign that, the complaints argue, was likewise meant to appeal to young people. The suits allege Juul planted the seeds for a youth addiction epidemic that would make nicotine cool again after years of historic declines in cigarette smoking.
Juul’s executives have repeatedly denied that they meant to attract children; they say their goal has always been to give adult smokers a better option than deadly combustible cigarettes. To their credit, most health experts agree that e-cigarettes—while not full-stop safe—are less dangerous than cigarettes. And Juul, with a sleek design and satisfying nicotine delivery, could be particularly appealing to adult smokers looking to switch. Whether Juul meant to attract them or not, though, millions of teenagers have used its products. In 2020, about 20% of high school students and 5% of middle-school students said they had vaped some sort of e-cigarette in the past month. Those figures are down from 27.5% and 10.5%, respectively, in 2019—rates high enough to prompt sweeping regulations on e-cigarettes.
In late 2019, the Trump Administration raised the legal tobacco purchase age to 21. Days later, the U.S. Food and Drug Administration (FDA) banned many flavored vaping products that could appeal to teenagers. The FDA, which recently announced an impending ban on menthol-flavored combustible cigarettes and flavored cigars, is currently deciding whether to continue allowing the sale of e-cigarette products in the U.S.—and for teen favorites like Juul, data around youth vaping could be the nail in the coffin.
How could things have gone so wrong for a company founded by two Stanford students who said they wanted to make cigarettes obsolete? The fall from grace began in June 2015, when Juul was just a promising innovation from a startup called Pax Labs. Juul’s launch, almost six years to the day before the company will stand trial in a North Carolina courtroom, marked both its beginning and the beginning of its end.
Juul vaporizers were everywhere. Stacks of the slim devices littered every surface, lying there free for the taking—which people were doing happily, grabbing them and exhaling plumes of sweet-smelling vapor.
Juul’s June 2015 launch party was held at Jack Studios, a giant industrial loft space in Manhattan often used for fashion photo shoots, with striking views of the city skyline and the Hudson River below. Guests could pose for photos in front of a multicolored triangle pattern, drawn from Juul’s first ad campaign, Vaporized. The Vaporized campaign was fun and colorful, full of fresh-faced models dressed in trendy clothes flirting with the camera and posing against colorful backdrops.
Drinks were flowing from the open bar, and every guest left with plenty of Juul swag. The events team hired buzzy DJs Phantogram and May Kwok, and Top Chef winner Ilan Hall handled catering. Marley Kate, the photographer who’d shot the Vaporized campaign, took photos of guests, which were then projected onto the loft’s walls as live art. The best shots had a chance at appearing on the company’s Times Square billboard.
The goal was for cool New York City socialites to be seen pulling on Juul vaporizers. The company had specifically chosen to launch Juul in New York City and Los Angeles, two trendsetting cities full of influencers and journalists who, according to a company marketing document released in 2019 by a congressional subcommittee, could help build buzz.
Pax—the parent company that made and marketed Juul products—had spent much of its marketing budget on advertisements that appeared in convenience stores and other retail spaces, as well as on the Times Square billboard and in a print ad that appeared in Vice, which called itself part of the “#1 youth media company in the world.” But social media marketing was valuable to the scrappy startup too, in no small part because it was cheap. If influencers were seen using the Juul, their followers would want to try it. And once their followers tried it, they would post about it and tell their friends. But this social media marketing strategy, unlike most utilized by startups, hinged on promoting an age-restricted and highly addictive nicotine product on platforms beloved by teenagers.
To get the word of mouth flowing, Pax hired Grit Creative Group, a marketing agency that called itself “an authority on millennial culture,” to secure influencer guests for the Juul launch party. In addition, a network of nearly 300 New York and Los Angeles influencers would be gifted free Juul products over the coming weeks. On the list were movie star Leonardo DiCaprio (who had already been photographed vaping other e-cigarettes), and model Bella Hadid. At the time Juul launched, in June 2015, Hadid had almost a million Instagram followers—and, at 19, was only barely able to legally purchase an e-cigarette in most states.
Giving launch-party guests the chance to pose for a professional photographer, and potentially appear on a Times Square billboard, was a brilliant viral marketing move. After the party, social media were awash in photos of young, attractive people holding drinks and puffing on Juuls, their photos hashtagged #Vaporized and #LightsCameraVapor. Juul’s official accounts posted some photos too. “Having way too much fun at the #JUUL launch party,” read one tweet from Juul’s handle, right above a photo of five fashionably dressed young women pouting for the camera. “The party was a resounding success (at least in my mind) in terms of winning over the cool kids,” one employee wrote afterward in an email to chief operating officer Scott Dunlap; the email was later included in the multi-district litigation against Juul, initial trials for which are set to begin next year.
Juul didn’t stop at one great party. After that night at Jack Studios, it set off on a six-month “sampling tour” concentrated in urban areas. Juul-branded shipping containers popped up at concerts, clubs and rooftop bars, beckoning people inside with bright colors and the promise of free products. The cargo containers featured a lounge area; an “animated GIF booth” where people could pose for the camera; and a “flavor bar” where guests could try tobacco, mint, fruit or crème brûlée Juul pods.
People liked what they saw. “@juulvapor is the best, most satisfying #ecig I’ve ever tried. Great product! Only $50 too!” one customer tweeted a few days after the product launched. “Juul has won me over in just a week,” a blogger wrote on the site Engadget, marveling that after he’d smoked for 14 years, Juul had helped him dramatically cut down on cigarettes. Even the mainstream press was noticing. A Wired profile proclaimed Juul possibly “the first great e-cig.”
But some of the social media posts coming in after sampling events made certain executives uneasy. “I would catch myself saying, ‘Wow, they look really young,’” former COO Dunlap told the New York Times. “But you don’t really know. It’s social media after all, where everyone is their younger, idealized selves.”
Shortly after the product launched, Ad Age published an article in which a spokesperson from the Campaign for Tobacco-Free Kids voiced concerns about Juul’s marketing appealing to kids. “We’re seeing more and more irresponsible marketing of unregulated products such as e-cigarettes,” the spokesperson said. “We are concerned any time a new product or new advertising campaign goes public regarding cigarettes and tobacco and their addictive nicotine.”
The story was a wake-up call. “We were like, ‘Oh my God, that’s terrible,’” says a source involved in the launch campaign, who wished to remain anonymous because they were not authorized to speak about their time at the company. Company executives insist they didn’t want their products to appeal to kids, or even to be perceived as appealing to kids. The Vaporized campaign had been in the world for only a short time, but already Pax executives were realizing it could sink the company before it swam.
In July 2015, just a month after Juul officially launched, Pax investor Alexander Asseily began to get very vocal about his concerns, according to documents included in a legal complaint filed by the Hawaii attorney general in 2020 and currently moving through pretrial hearings. If the company kept marketing in ways that could be seen as targeting kids, Pax was going to get lumped in with Big Tobacco, an industry infamous for preying on young people with its marketing. “We will continue to have plenty of agitation if we don’t come to terms with the fact that these substances are almost irretrievably connected to the sh-ttiest companies and practices in the history of business,” Asseily wrote in an email to board members included in the Hawaii legal complaint. “It’s not about faking it—it’s about doing it correctly … which could mean not doing a lot of things we thought we would do like putting young people in our poster ads or drafting in the wake of big players in the market.”
Shortly after, Asseily began brainstorming with chief marketing officer Richard Mumby about what the company could do differently. They kicked around ideas like a program through which smokers could turn in their cigarette packs or subpar vaping products in exchange for discounts on Juul products. It would “send the only message that’s needed,” Asseily wrote in an email to members of the leadership team included in the multidistrict litigation complaint. “Juul is a superior alternative to conventional smoking and mediocre vaping products.”
That idea never got off the ground, but it was clear something had to change. Mumby began working on a replacement for the campaign he had only just launched, one that people within the company hoped would have no appeal to—or even the perception of an appeal to—kids. The new concept would have a more muted color scheme and focus on shots of the product itself rather than on models. Some of the Vaporized ads were pulled immediately, even before the new spots were ready.
While this was happening, however, the Juul brand was beginning to spread, slowly but surely, on social media and online. If parents had known what Juul was back then, they probably would have been appalled. But the device was so new, and looked so much like a flash drive, that they might not have known that what their children were actually seeing as they scrolled through social feeds on their phones was an addictive e-cigarette. And even if they did know what Juul was, they almost certainly wouldn’t have known how much nicotine it contained. That ingredient was disclosed only at the very bottom of the ad, in tiny print. Besides, the eye was drawn to other words. JUUL, the ads read in huge block letters. VAPORIZED.
Matthew Myers, president of the Campaign for Tobacco-Free Kids, watched uneasily as this unfolded. When he saw Juul’s ads, all he could think of were old cigarette ads. They ticked the same boxes: young, fun models selling sex, sophistication and a good time. “As somebody who’s worked in this field and looked at cigarette industry behavior too long,” Myers says, “the instant reaction is: Juul is replicating the 1950s and 1960s playbook from the cigarette companies.” Pax executives may have said Juul was for adult smokers only, but to Myers, their actions didn’t match their words.
Juul’s Vaporized campaign came out amid a spirited debate in the public-health world. In 2015, the World Health Organization commissioned a report that warned e-cigarettes might damage the lungs and expose users to carcinogens. The same year, Public Health England, an agency sponsored by England’s Department of Health and Social Care, declared in a highly publicized report that thanks to their lower levels of carcinogens and harmful chemicals, e-cigarettes were 95% safer than combustible cigarettes. It was difficult figuring out what to believe, but the anti-vaping crowd had at least one leg up: it could always bring the conversation back to Big Tobacco, especially as Pax and other companies made dubious marketing decisions like Vaporized.
Many people, like Myers, saw history repeating itself in Juul’s Vaporized campaign. Big Tobacco had lied to the public and targeted teenagers for decades; if it looked like vaping companies were following in their footsteps, e-cigarettes suddenly came out looking a bit more sinister. No matter how deeply scientists believed in tobacco-harm reduction, there was little they could do to defend themselves when e-cigarette brands were lumped in with Big Tobacco. “When we push back against [anti-e-cigarette rhetoric], we sound like we’re defending the tobacco industry,” laments Raymond Niaura, a tobacco dependence and treatment expert at New York University who supports the use of e-cigarettes.
Pax executives should have known about these dynamics and designed a launch campaign that had no possible link to Big Tobacco. But the promise of future growth seemed to trump historical caution. “They had the Silicon Valley mindset of ‘We’re a tech company; we’re not a tobacco company,’” says Gregory Conley, president of the American Vaping Association. “And so, they hired very, very few people with experience in tobacco” early on. If they had, Conley says, they might have had on staff people able to see where things were going, who would have never let a campaign with even a chance of drawing comparisons to Big Tobacco end up on a billboard in Times Square.
Instead, the comparisons to cigarette ads and the allegations of targeting teenagers clouded Juul’s reputation right from the very beginning—even more so as teen vaping rates soared and Juul gobbled up market share. To this day, health experts and anti-vaping advocates often point to Juul’s ill-fated Vaporized campaign as evidence that it purposely hooked teenagers and engineered a brand-new addiction.
For years, that allegation mostly amounted to bad press. Now, though, Juul may be in for its most serious threats yet. The outcome of Stein’s lawsuit in North Carolina could set a precedent for the hundreds of other pending cases against Juul, filed by school districts, individuals and attorneys general from states including Massachusetts, California, Colorado, Hawaii and Minnesota.
Beyond that, the outcome in North Carolina could color the FDA’s impending decision on e-cigarette products like Juul. After years of allowing e-cigarettes to be sold without formal FDA approval, the agency is now sifting through applications from hundreds of companies trying to prove their products can help protect public health, the benchmark they must meet to stay on the U.S. market. Vaping products’ popularity among teenagers is likely to be a strike against many manufacturers—so if a state attorney general can prove that Juul purposely lured underage customers, the aggressive regulators of the Biden Administration’s FDA could find that too large a red flag to ignore. E-cigarette makers like Juul may be next on the FDA’s chopping block, particularly if the company’s past comes back to haunt it.
Juul’s supporters argue too much attention has been paid to a single advertising campaign that ran for only a few months and, the company contends, made little impact on Juul’s sales. But as the saying goes, you don’t get a second chance at a first impression. If Juul had a target on its back in the years that have followed, it was only because it put one there with its early, unforced error. And now, lawyers like North Carolina’s Stein are shooting for a bull’s-eye.
Adapted from Ducharme’s book, Big Vape: The Incendiary Rise of Juul, out May 25
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