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August 30, 2019 12:50 am

FTC Is Investigating Juul's Marketing Practices

The FTC is investigating whether e-cigarette startup Juul Labs used influencers and other marketing to appeal to minors (Warning: source paywalled; alternative source). The Wall Street Journal reports: The probe, which hasn't previously been disclosed, began before the agency's antitrust review of a December deal in which tobacco giant Altria Group invested $12.8 billion to take a 35% stake in Juul, those and other people familiar with the matter said. The FTC is also determining whether to seek monetary damages, one of the people said. The agency in September first sent Juul a letter requesting information about its marketing, two of the people said. FTC investigators are looking at whether Juul engaged in deceptive marketing. The agency has designated the investigation as nonpublic. The Food and Drug Administration and several state attorneys general also are investigating Juul's marketing practices. The FDA last October conducted a surprise inspection of Juul's headquarters and collected documents about its marketing. Juul's first marketing campaign in 2015, called "Vaporized," pitched the brand as a cool lifestyle accessory with images of people in their 20s and 30s, which critics say made the brand attractive to teens. Later, as sales of the sleek devices took off in 2017, Juul-related posts exploded on Instagram and Twitter with photos posted by young people using the product. Juul has since shut down its Facebook and Instagram accounts in the U.S. and changed its marketing to feature only adult smokers at least 35 years old who have switched to Juul. It has also voluntarily stopped selling sweet and fruity flavors in bricks-and-mortar stores. "We fully cooperate and are transparent with any government agency or regulator who have interest in our category," a Juul spokesman said. The company says it has never marketed to youth and that its products are intended for adult cigarette smokers. The company says it supports legislation to raise the minimum purchase age to 21. It also unveiled a plan on Thursday to install an electronic age-verification system at gas stations and convenience stores intended to curb illegal sales to minors.

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