Lack of E-cig Regulations Spark Ad War

Jan 30, 2015

The government is finally making a move on the regulation of e-cigarettes. The now billion dollar industry has run unchecked by the federal government for years, leaving it to the states to regulate. Current rules give the federal government the authority to regulate e-cigs along with pipe tobacco, cigars, and other related products. But these rules neglect to address several important and pressing issues like, if flavored e-cigs should be available and how to regulate television advertisements. This will require more rule making, which has been notoriously slow thus far. While the process of rulemaking is old hat for the government, e-cig advocates and merchants are frustrated.

Mitchell Zeller, the director of the FDA’s Center for Tobacco Products, explains that the reason that the agency has not made rules pertaining to flavors and advertising is because regulators are waiting on science to fully understand the health effects of e-cigs. This means that, at least for now, the e-cig market is wide open for investors and e-cig merchants to saturate the market with flavors and advertising.

Health advocates are also frustrated by slow FDA regulations. They believe that the FDA should make preliminary rules that restrict the flavoring of e-cig solutions and advertising, as flavors like bubble gum and cotton candy will entice children to use e-cigs. These issues may not be addressed for years. Even if the FDA addresses these issues, companies legally have two years after regulations kick in to submit applications for approval. If some companies sue, this could further delay the process.

Because of a lack of advertising restrictions for e-cigs, a marketing war is destined to occur between traditional cigarette companies that have invested in e-cig brands. Companies like Altria, parent company of Phillip Morris USA and R.J. Reynolds, are gearing up for nationwide marketing campaigns. Previously these companies agreed to stop traditional cigarette marketing on billboards and other forms of public transportation. When asked if this policy would continue with e-cigarettes, a representative of Altria declined to answer.

Now is the time for entrepreneurs interested in carving out a space in the e-cig landscape to build brand recognition and make serious profits. EMB’s dedicated account managers can create and manage your e-cig merchant account so that your customers have the ability to pay for products online and with debit/credit.

Let us help you get a high risk merchant account today!

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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