“Four Reasons for Ohio”: Despite Nearly 66,000 Taat Units Sold Pre-Launch in Other Markets, Taat CEO Gives Video Statement Regarding Decision to Launch Taat in Ohio
In its October 6, 2020 press release, the Company announced the U.S. launch of Taat would occur in the state of Ohio in mid-Q4 2020. Despite stellar performance of small-scale test batches of Taat in other states, including a 72-hour sell-out in Nevada in August 2020 and total unit turnover of nearly 66,000 units, the Company’s decision to launch specifically in Ohio was based on several strategic factors which are detailed by CEO Setti Coscarella in a video statement dated October 30, 2020.
LAS VEGAS and VANCOUVER, British Columbia, Oct. 30, 2020 (GLOBE NEWSWIRE) — TAAT LIFESTYLE & WELLNESS LTD. (CSE: TAAT) (OTCQB: TOBAF) (FRANKFURT: 2TP2) (the “Company” or “Taat”) has issued a video statement by its Chief Executive Officer Setti Coscarella detailing the Company’s rationale for selecting Ohio as the launch market in the United States for Taat, a tobacco-free and nicotine-free alternative to tobacco cigarettes. To date, Taat and the Beyond Tobacco™ base material have enjoyed substantial popularity among current tobacco smokers of legal age in Nevada, California, Georgia, and Texas, who sampled a limited supply of early iterations of the product beginning in 2019, with many purchasing Taat at retail in place of their routine tobacco cigarette purchases. Although a large quantity of Taat has been sold at retail with no advertising, marketing, or in-store promotion of any kind in these markets, the Company announced in its October 6, 2020 press release that it would be launching Taat in Ohio, with a launch date of November 27, 2020 announced shortly thereafter. To clarify the basis of the Company’s decision to launch Taat in Ohio as opposed to the markets in which it has already been successful, Mr. Coscarella has issued a video statement outlining the Company’s rationale, which is provided in this release.Taat has developed Beyond Tobacco™, the nicotine-free and tobacco-free base material of Taat, an alternative to cigarettes designed to be experientially similar to smoking tobacco. Offered in Original, Smooth, and Menthol varieties, Taat is designed to be attractive to current tobacco smokers of legal age who wish to keep the experience of smoking cigarettes, while leaving nicotine behind. The Company’s executive management team, formerly of the tobacco industry, is creating commercialization strategies to build Taat’s market share in the USD $814 billion global tobacco industry.Prior to its acquisition by the Company, Taat Herb Co. began to carry out retail market research of the Taat product and the Beyond Tobacco™ base material formulation in early 2019, which included R&D samples under the Taat brand name as well as private label production. This research, which was initially conducted in the U.S. states of Texas and Georgia, was continued in May 2020 with retail market testing undertaken by the Company in California and Nevada. Among more than 50 participating tobacco retailers in California and Nevada, over 75% placed reorders after their inventory of Taat sold out, with a general consensus from trial users that the “test” version of Taat at the time had no significant experiential differences when compared to a tobacco cigarette. In Taat’s August 13, 2020 press release, it was announced that a subsequent iteration of retail market testing with Nevada-based tobacco retailers resulted in a complete sell-out in less than 72 hours. Based on sustained demand for Taat in this August 2020 retail market testing iteration, selected retail stores’ management indicated they would increase their next orders of Taat by a minimum of 200%. To date, a total of 65,797 units of Taat have been sold at retail in Texas, Georgia, Nevada, and California since March 2019, between full packs and loose units.Taat CEO Setti Coscarella’s October 30, 2020 statement regarding the Company’s decision to launch Taat in Ohio. To access this video clip, please click here.Readers using news aggregation services may be unable to view the media above. Please access the Investor Relations section of the Company’s website for a version of this press release containing all published media.In the video statement published October 30, 2020, Taat CEO Setti Coscarella explained the four principal reasons supporting the Company’s decision to launch Taat in Ohio. These reasons include a sufficiently large population and high incidence rate of smoking, balanced by favourable geographical factors such as a containable footprint and Ohio’s shared borders with five other states which have a combined population of more than 35 million people in addition to Ohio’s population of 11.69 million. The Company intends to leverage insights from its pre-launch success in other markets to establish a profitable market position in Ohio, and potentially expand commercialization activities across the United States.Taat Chief Executive Officer Setti Coscarella commented, “Part of why I am so confident in Taat’s ability to sell consistently is because of its proven track record in retail market testing, in which the test inventory of the product sold very well. What I believe is most impressive about these results is that they were achieved with no marketing or advertising of any kind. In 2018 the tobacco industry spent USD $9.06 billion on marketing in the United States alone2. With 216.9 billion cigarettes sold domestically in that same year3, or approximately 10.8 billion 20-stick packs, that theoretically works out to an average marketing cost of more than USD $0.83 per pack, which is 13.47% of the USD $6.164 national average price of a pack of cigarettes. While we certainly did not sell 216.9 billion sticks of Taat, we did sell over 65,000 units of test product in the form of both packs and loose units in no time with a marketing cost of zero dollars. While we do intend to carry out some marketing activities when we launch in Ohio, we now know Taat is capable of getting steady sell-through with no marketing at all. As such, I am very excited to see what effect marketing can have as we introduce Taat to current smokers of legal age in Ohio as part of our push to gain market share in the tobacco industry.”Sources1 – https://www.who.int/news-room/fact-sheets/detail/tobacco2 – https://www.cdc.gov/tobacco/data_statistics/fact_sheets/economics/econ_facts/index.htm3 – https://www.ftc.gov/system/files/documents/reports/federal-trade-commission-cigarette-report-2018-smokeless-tobacco-report-2018/p114508cigarettereport2018.pdf4 – https://money.com/smoking-costs-cigarette-taxes-expensive/On behalf of the Board of Directors of the Company,TAAT LIFESTYLE & WELLNESS LTD.“Setti Coscarella”Setti Coscarella, CEOFor further information, please contact:Taat Investor Relations
[email protected]THE CANADIAN SECURITIES EXCHANGE (CSE) HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ACCURACY OR ADEQUACY OF THIS RELEASE.About Taat Lifestyle & Wellness Ltd.Having developed Beyond Tobacco™, which contains no tobacco or nicotine, Taat’s objective is to introduce an innovative, experience-driven alternative to tobacco cigarettes for tobacco smokers who aspire to leave nicotine behind. Beyond Tobacco™, which is to be offered in “Original” and “Menthol” varieties, is designed to closely emulate every aspect of smoking a traditional cigarette. From the cigarette-style packaging and stick format, to the proprietary flavouring blend which imparts the flavour and scent of tobacco, to the draw sensation, and the amount of smoke exhaled, Beyond Tobacco™ has been meticulously engineered to enable smokers to continue enjoying the experience of smoking, while discontinuing nicotine intake. Taat plans to launch Beyond Tobacco™ in mid-Q4 2020 and is seeking to position itself in the USD $814 billion (2018)1 global tobacco industry to capitalize on the growing worldwide demand for alternatives to traditional cigarettes.For more information, please visit http://taatusa.com.References1British American Tobacco – The Global MarketForward Looking StatementsThis news release contains “forward-looking information” within the meaning of applicable Canadian securities legislation. Often, but not always, forward-looking information and information can be identified by the use of words such as “plans”, “expects” or “does not expect”, “is expected”, “estimates”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur, or be achieved. Forward-looking information in this news release includes statements regarding the potential launch of Beyond Tobacco™, in addition to the following: Potential events and outcomes relating to the launch of Taat in Ohio, and potential sales performance of Taat with limited or no marketing expenditures. The forward-looking information reflects management’s current expectations based on information currently available and are subject to a number of risks and uncertainties that may cause outcomes to differ materially from those discussed in the forward-looking information. Although the Company believes that the assumptions and factors used in preparing the forward-looking information are reasonable, undue reliance should not be placed on such information and no assurance can be given that such events will occur in the disclosed timeframes or at all. Factors that could cause actual results or events to differ materially from current expectations include: (i) adverse market conditions; (ii) changes to the growth and size of the tobacco markets; and (iii) other factors beyond the control of the Company. The Company operates in a rapidly evolving environment. New risk factors emerge from time to time, and it is impossible for the Company’s management to predict all risk factors, nor can the Company assess the impact of all factors on Company’s business or the extent to which any factor, or combination of factors, may cause actual results to differ from those contained in any forward-looking information. The forward-looking information included in this news release are made as of the date of this news release and the Company expressly disclaims any intention or obligation to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required by applicable law.The statements in this news release have not been evaluated by Health Canada or the U.S. Food and Drug Administration. As each individual is different, the benefits, if any, of taking the Company’s products will vary from person to person. No claims or guarantees can be made as to the effects of the Company’s products on an individual’s health and well-being. The Company’s products are not intended to diagnose, treat, cure, or prevent any disease.This news release may contain trademarked names of third-party entities (or their respective offerings with trademarked names) typically in reference to (i) relationships had by the Company with such third-party entities as referred to in this release and/or (ii) client/vendor/service provider parties whose relationship with the Company is/are referred to in this release. All rights to such trademarks are reserved by their respective owners or licensees.Statement Regarding Third-Party Investor Relations FirmsDisclosures relating to investor relations firms retained by Taat Lifestyle & Wellness Ltd. can be found under the Company’s profile on http://sedar.com.