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TheStreet Open House

eCig Advertising Marketing Snares the Cool eKid Generation in Net

Stocks in this article: RAILOMO

NEW YORK ( TheStreet) -- Increased competition in the electronic cigarette market could lead to an explosion of advertising for the product bringing nicotine back to the public consciousness in full force.

R.J. Reynolds (RAI) said earlier this month that it would expand its Vuse electronic cigarette brand nationally, making it the second of the three big tobacco companies -- Lorillard (LO) and Altria (MO) -- to make a serious national push into e-cigarettes.

Lorillard was the first national player in e-cigarettes when it acquired Blu eCigs in 2012 for $135 million, and now commands close to 40% of current market share.

The expansion into e-cigarettes could ignite an advertising battle between Reynolds, Lorillard, and Altria as all three fight to capture market share in the burgeoning vaporized cigarette industry. Earlier this year a study was published by the journal Pediatrics, showing that between 2011 and 2013 exposure to e-cigarette TV ads increased by 256% among adolescents ages 12 to 17 and by 321% among young adults, ages 18 to 24.

The advertising most often appeared on broadcast network programs that were among the 100 highest rated youth programs for the 2012-2013 TV season. In one commercial, the stunning actress Jenny McCarthy discusses how she enjoys e-cigarettes because they are more "satisfying" than traditional tobacco based cigarettes.

Read: Philip Morris Focuses on Hot E-Cigarettes to Overcome Expected Cool Earnings

Lorillard's Blu eCigs accounted for almost 82% of all nationally aired e-cigarette ads viewed by 12- to 17-year-olds, the study said.

Jennifer Duke, lead author of the study and a public health researcher at RTI International in Research Triangle Park, N.C., was unavailable to comment on how increased competition in the e-cigarette space may lead to more advertising dollars spent on the product. In an effort to show how competition could lead to more exposure of e-cigarettes, a classic lesson from microeconomic theory on imperfect competition suffices.

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