The development of the vaping industry is not as straight forward as predicted. Starting in the early 2000's, the sale of vaping and electronic cigarette products has blossomed into a six billion dollar market, with the specter of ten billion USD by 2017. This growth has led to speculation over what dollar figures the sale of vapes and e-cigarettes may stand to become. Sales of products dedicated to the sale and consumption of nicotine remain strong, however, and vaping happens to be only one of the many facets of a global market.
The growth of the vaping market is contingent upon several factors; most important, that its futures are inexorably tied to the futures of the tobacco industry - much to the chagrin of vaping enthusiasts - simply because both industries court the same demographic. It would perhaps be wiser to think of tobacco and vaping as two sides of the "Nicotine Industry", as this is the substance that both sell, only through different vehicles. At other times the lines that separate the two become blurred: Tobacco companies have actively bought up smaller electronic cigarette companies, such as Altria's (formerly Philip-Morris) acquisition of Green Smoke. Though seventy percent of the vaping industry is owned by only ten independent companies (as of 2015), this market dominance is not invulnerable: when R.J. Reynolds introduced its e-cigarette brand (called Vuse) to Colorado, it held a 55% market share within sixteen weeks. The resulting lesson is clear: while a young industry, the hands that steer the future of the vaping market can change quickly, and often have in favor of ownership by Big Tobacco.
This, in turn, helps to spur the current valuation of the Vaping and e-cigarette market. Tobacco has seen a dip in its overall production rate since the halcyon days of the 1950's and 1960's, with only a 12% worldwide increase in production since the year 2000. As such, it has turned increasingly to expanding or potential markets as a means of maintaining profitability, both geopolitical (China, Southeast Asia) and technological (vaping/e-cigarettes). The vaping and e-cigarette market, existing almost exclusively within America and Europe, pales in comparison to the profit margins promised by a developing country. When industry giants such as Altria and BAT/Reynolds buy into the world of vaping, it is usually as a lesser thrust of their grand strategy to explore new sources of income. When it occurs, however, it is done quickly and spurs larger assessments of the vaping industry. Case in point: in 2013, the Euromonitor International reports a $1.38 billion USD increase in global e-cigarette sales from 2012, for a market of $3.14 billion USD. The reason? In April 2012 Lorillard purchased Blu E-cigs for a mere $135 million USD. By comparison, in 2013 the global sales of conventional cigarettes was $722 billion USD, according to Newsweek. Small ponds have big ripples.
Admittedly, this trend of (relatively) small purchases by big tobacco that then spurs a larger valuing of vaping markets has proved consistent. By 2016, the industry was worth six billion dollars and growing at an estimated rate of 42% a year according to PBS. But this market has a hard ceiling due to the fact that it truly only exists in two major markets: Europe and North America. Big Tobacco, for all of its patronage of the industry, has no intentions to expand the sale of e-cigarettes into South America, Africa or Asia simply because sales of conventional cigarettes are unhindered and require less specialized manufacture. Given that the growth of the Vaping industry is almost exclusively dictated by the whims of the tobacco industry, this factor will severely limit the global sale of e-cigarettes in the next decade. It's a lot simpler to automate cigarette rolling than vape pens, which means the possibility of a thirty billion dollar vaping industry is only achievable within these two markets. An unlikely scenario.