Juul Labs is reportedly stopping sales in Indonesia as it is unable to prevent retailers from selling its high-nicotine e-cigarettes to younger consumers in an unregulated tobacco market. The brand expanded into Indonesia last July as it was drawn to the country's "permissive regulatory environment", Reuters reported, adding that Juul's target audience fell between the ages of 19 to 35.
Reuters said sales in Indonesia would be "suspended indefinitely" until it is able to ensure that local online and traditional retailers will "increase and enforce age restrictions and compliance measures". Juul's products have reportedly been promoted in cinemas and shopping malls patronised frequently by younger consumers. According to Reuters, the brand also sold its products at kiosks and "in sleek, Juul-branded retail shops" that resembled Apple stores.
The e-cigarette company also reportedly tapped "ambassadors", who were often good looking young women, to promote Juul at nightclubs and bars. Just last month, Juul also allegedly installed kiosks in office buildings around Jakarta serving young tech employees, as well as placed ads in office lifts concerning Juul flavours. A quick check by Marketing Interactive found that Juul's products are available on renowned Southeast Asian eCommerce platforms including Lazada, Tokopedia, Blibli, and Shopee. The decision to halt sales in Indonesia follows Juul's decision in reviewing its South Korean strategies and operations last month as a result of "disappointing sales". Juul has also faced regulatory scrutiny in South Korea.
At the same time, two of Juul's senior executives have left the company - president of Asia Pacific South divisions, Ken Bishop, and president of Europe, Middle East and Africa, Grant Winterton, according to media reports including the Wall Street Journal and CNBC. It also intends to reduce more than 20 employees at its Asia Pacific regional headquarters in Singapore. Following Bishop's and Winterton's exit, chief commercial officer Jared Fix will now be responsible for international operations. Marketing Interactive has reached out to Juul for comment on its Indonesia sales and the exits of Bishop and Winterton.
The e-cigarette company was recently sued for intentionally marketing and selling its e-cigarettes to young people on platforms such as Cartoon Network and Nickelodeon. A lawsuit filed in Massachusetts court seen by Marketing said Juul intentionally chose models and images that appealed to young people.
“Juul used these programmatic media buyers to purchase space for Juul advertisements on websites that were highly attractive to children, adolescents in middle school and high school, and underage college students. These advertisements included the images of models from the Vaporized Campaign,” attorney general Maura Healey said in the lawsuit.
Last July, then CEO Kevin Burns was also slammed by non-profit organisation Campaign for Tobacco-Free Kids for a "fake apology", following a documentary which aired on CNBC. Campaign for Tobacco-Free Kids also alleged that Juul still refuses to admit that the company’s marketing is targeted children, or has played a major role in youth use of its e-cigarettes, despite overwhelming evidence to the contrary. Marketing has reached out to Juul for its comments.
Burns stepped down as CEO last September and was replaced by K.C. Crosthwaite. A previous press statement said Crosthwaite and the entire Juul leadership team will continue a broad review of the company’s practices and policies to ensure alignment with its aim of responsible leadership within the industry. Effective immediately, the company said on 25 September that it is suspending all broadcast, print and digital product advertising in the US, and refraining from lobbying the government on its draft guidance and committing to fully support and comply with the final policy when effective.