Another win for TAAT Lifestyle & Wellness (TAAT Lifestyle & Wellness Stock Quote, Chart, News, Analysts, Financials CSE:TAAT) as the company garnered a $1-million order from Worldwide Vape Distribution (WWV) for its line of Beyond Tobacco cigarettes.
Taking on the US$814-billion tobacco industry, TAAT makes a nicotine-less, plant-based cigarette that gives the feel and experience of smoking without the tobacco and nicotine elements and their associated addictive qualities. TAAT launched in the United States in late 2020 in the state of Ohio while nationwide the company opened its e-commerce portal in February.
TAAT announced on Friday the US$1-million order from WWV, a Dallas, Texas-based wholesaler in the e-cigarette market with a network of over 10,000 retailers across 38 states. Last summer, WWV became TAAT’s first distribution partner.
“Although we have seen demand from all over the United States, we recognize the need to strategically identify which markets we will enter next,” said TAAT CEO Setti Coscarella in a press release. “One prerequisite for doing so is securing distribution, and after discussions with WWV’s management team we have determined that they can get us into retailers in several of our high-priority markets.”
“We are honoured that WWV was not only confident enough in TAAT for them to become our first distribution partner well in advance of the product launch, but also for them to have placed a seven-figure order of TAAT right at the outset of doing business,” Coscarella said.
TAAT said it will begin fulfilling the order in late April and aims to collaborate with WWV in aligning distribution initiatives with promotional campaigns in new markets.
WWV CEO Muhammad Abbas spoke of the potential for TAAT’s cigarette alternative in a market of over one billion smokers worldwide.
“In the vaping business, it is common for smokers aged 21+ to try electronic cigarettes as a substitute for smoking tobacco. However, we are regularly told about how they miss the sensation of igniting a cigarette, tasting and smelling the tobacco as it burns, seeing the smoke as they exhale and flicking ashes in between drags. With our nationwide reach, we could not be more proud to place an order of this size with an objective of being one of the catalysts in distributing TAAT to retail stores in several new U.S. markets,” Abbas said in the press release.
TAAT, which arrived as a public company last April via reverse takeover by Molori Energy, saw its share price quickly start jumping, going from an initial C$0.67 to as high as C$6.00 by mid-February of this year. The stock has fallen back since and is currently trading in the low-C$3.00 range.
For its Beyond Tobacco product, TAAT completed test runs in Nevada, California, Georgia and Texas before setting its sights on Ohio for its size (11.7 million) and high smoking rate. Shipments began in December, 2020, after an initial marketing campaign across the state’s tobacco retailers. By January, TAAT was announcing that Ohio retailers were selling out of its Menthol variety, while across the country the company rolled out its TryTAAT campaign involving sample packs to legal-aged smokers in the US.
Last week, TAAT announced results from a survey among smokers aged 21+ on their perception of the TAAT concept. The survey of more than 1,200 smokers in Ohio, Michigan, Illinois and Pennsylvania found over 65 per cent of respondents said the financial burden of purchasing tobacco cigarettes was something they disliked about smoking, more than half of respondents said they “Definitely Would” or “Probably Would” purchase TAAT at proposed price points for Ohio, Michigan, Illinois and Pennsylvania, and 95 per cent said the ability to purchase TAAT online was “Extremely Appealing,” “Very Appealing” or “Somewhat Appealing.”
Coscarella said the survey reinforced the company’s belief in the competitive advantages of TAAT in the global tobacco industry.
“The responses to this study reinforced our belief that TAAT has several competitive advantages in the $814 billion global tobacco industry, including the novel element of being nicotine-free and tobacco-free, an attractive price point compared to tobacco cigarettes, and the ability to purchase TAAT online,” Coscarella said in a press release.
“As we expand our market footprint in 2021, we intend to capitalize on these advantages to capture the interest of smokers aged 21+ and further establish TAATTM as a better choice and a recognized brand name in the tobacco category,” he wrote.
Last month, TAAT said its TryTAAT campaign has received over 5,000 requests for sample packs from residents in eligible US states, with the company saying its current aim is to prompt a high trial rate to cultivate large-scale awareness and to gather feedback.
“Our goal with the latter two initiatives is to get ‘pack in hand’,” Coscarella said in a March 26 press release. “No matter how informative our messaging and user testimonials may be, we firmly believe that after a smoker aged 21+ has sampled TAAT, a certain percentage will be persuaded into purchasing it regularly based on a positive experience.”
Disclaimer: TAAT is an annual sponsor of Cantech Letter.