The Federal Trade Commission is investigating whether e-cigarette startup Juul Labs Inc. used influencers and other marketing to appeal to minors, according to people familiar with the matter, ratcheting up pressure on a company whose products are blamed for a rise in vaping among teens.
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 Inc. 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.
“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.
“Our paid influencer program, which was never formalized, was a small, short-lived pilot” that ended last year, the spokesman said. The company paid less than $10,000 to fewer than 10 adults who were smokers or former smokers over the age of 30, he said.
Influencer marketing involves paying people with large social-media followings to promote a product.
The FTC and Altria declined to comment.
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….[Read More]
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