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An overview of the e-cigarette market in AustraliaMarket size in 2024: US$492.0 million
Market size in 2033: US$790.5 million
Market growth rate 2025-2033: 5.41%
According to IMARC Group's latest study, " Australia's E-Cigarette Market: Industry Trends, Share, Size, Growth, Opportunity, and Forecast 2025-2033 ," the Australian e-cigarette market was valued at US$492.0 million in 2024. IMARC Group projects the market to reach US$790.5 million by 2033, representing a CAGR of 5.41% from 2025 to 2033.
How AI is changing the future of Australia's e-cigarette market
• 78.3% social media penetration drives a digital awareness revolution: In January 2024, there were 20.80 million social media users in Australia, representing 78.3% of the total population, fundamentally changing how vaping products become visible and culturally accepted among young people. Digital media platforms represent vaping through influencers and peers showing stylish devices and techniques, making vaping seem appealing and socially acceptable despite regulatory restrictions. Many brands use indirect promotion through hashtags, viral challenges, and aesthetically pleasing e-cigarette videos, increasing awareness and interest, particularly among teens and young adults. The constant presence of vaping content acts as ongoing marketing, especially when it comes from famous personalities or influencers, encouraging experimentation and driving demand through social validation mechanisms that extend beyond traditional advertising channels.
• Prescription-based access transforms the medical oversight system: Australia has created one of the most distinctive regulatory frameworks in the world, requiring medical prescriptions for legal access to nicotine e-cigarettes under the oversight of the Therapeutic Goods Administration (TGA). This policy positions vaping as a doctor-supervised smoking cessation platform rather than a consumer health product, requiring consumers to obtain prescriptions from registered healthcare professionals and purchase products from registered pharmacies or approved online sources. From October 2024, people aged 18 and over can purchase vapes with a nicotine concentration of 20 mg/mL or less from participating pharmacies without a prescription where permitted by state and territory laws, although they must consult with pharmacists before purchase. This controlled access model, while restrictive, distinguishes Australia internationally and establishes dedicated channels for legal access to vaping products while limiting their adoption by young people through health-based controls.
• July 2025 Product Standards Implementation Drives Quality Control Innovation: New TGA Product Standards, coming into force from July 2025, set stricter compliance requirements for nicotine vaping products. Prescriptions for certain products or brands that no longer comply with the standards will become unfillable once they are implemented. Prescribers must consult TGA-notified lists of vaping products to identify therapeutic vaping products that comply with the new standards, fundamentally changing product availability and quality control. This regulatory evolution compels manufacturers and distributors to invest in compliant product development, improved safety features, and transparent ingredient disclosure, driving industry innovation to achieve pharmaceutical-grade manufacturing standards. The previously phased implementation provides grace periods for compliant products, while establishing clear quality standards that separate legitimate therapeutic products from the unregulated alternatives flooding the gray market.
• Annual 5% tobacco tax increase accelerates demand for alternative products: In March 2024, the Australian Government introduced the Excise Tariff Amendment (Tobacco) Act 2024 and the Customs Tariff Amendment (Tobacco) Act 2024, increasing the taxation of tobacco products by 5% annually for three years, along with standard indexation. This policy aims to reduce tobacco consumption by increasing duty rates on tobacco products and to promote a reduction in smoking among the Australian population by creating economic incentives for adult smokers to seek more affordable alternatives. High taxes on traditional cigarettes have led some consumers to seek substitutes such as e-cigarettes, particularly among price-sensitive demographics facing the rising cost of traditional smoking. The government's focus on reducing smoking prevalence and improving public health is positively impacting market dynamics, particularly among adult smokers seeking alternatives through prescription-based access channels and pharmacy consultations.
• The pharmacy-only sales model is revolutionizing distribution networks: Starting in July 2024, a legislative change will require all vapes and vaping products, regardless of nicotine content, to be sold exclusively in pharmacies for smoking cessation or the treatment of nicotine dependence. This distribution transformation eliminates convenience stores, specialized vape shops, and tobacco shops from legal sales channels, centralizing access through healthcare-focused pharmacies with trained professionals. Telemedicine providers and local pharmacies are increasingly partnering with licensed vape distributors, providing legal channels for adult smokers seeking harm reduction alternatives and ensuring professional advice with every purchase. This pharmacy-focused model results in an unprecedented restructuring of the distribution network, requiring significant investments in pharmacy partnerships, staff training programs, and inventory management systems that comply with therapeutic goods regulations rather than traditional retail models.
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E-cigarette market trends and drivers in Australia:
The e-cigarette market in Australia is experiencing transformational growth driven by regulatory changes, increased health awareness, and changing consumer attitudes toward smoking alternatives. The prescription access model, while restrictive, has influenced consumer adoption and encouraged companies to invest in compliant products and authorized retail channels. Regulatory clarity allows licensed operators to develop sustainable business models despite strict oversight. Meanwhile, telemedicine providers and pharmacies are creating accessible pathways for adult smokers seeking medically supervised harm reduction options. Inconsistencies in federal and state regulations pose challenges: Queensland and Western Australia are tightening local regulations, while federal legislation governs imports and national health policy through the Australian Border Force and the Transport and Health Administration (TGA).
Health awareness campaigns sponsored by government agencies and social movements have informed Australians about the risks of traditional smoking, creating demand for alternatives perceived as less harmful. Public health initiatives, anti-smoking campaigns, and restrictions on tobacco advertising have attracted attention to vaping among health-conscious demographics in major cities such as Sydney and Melbourne. Despite continued skepticism from the medical community, some view of vaping as a transitional tool for smoking cessation, and Australian health professionals are increasingly recommending e-cigarettes in controlled settings. This health-conscious attitude, coupled with the increased availability of prescription vaping products through pharmacy channels, is encouraging consumers to explore e-cigarettes as a means to help them quit smoking, expanding market penetration despite regulatory barriers.
Online market dynamics and youth lifestyle trends significantly influence market demand, despite regulatory oversight. Online platforms provide easy access to nicotine and non-nicotine vaping products, with many consumers turning to overseas websites offering products to Australian customers, circumventing local restrictions through international shipping. Vaping's cultural influence, linked to fashion, media influence, and lifestyle branding, attracts young people in urban centers and regional areas, who perceive vaping as an alternative to smoking and a form of self-expression. Flavored e-liquids and the sleek, minimalist design of devices appeal to a tech-savvy and fashion-forward population, stimulating demand through aesthetic appeal and public acceptance, despite law enforcement efforts to combat illegal imports and gray market sales.
Government tobacco control initiatives are creating market opportunities for e-cigarettes positioned as an alternative to smoking. Public health campaigns, restrictions on traditional cigarette advertising, and support for smoking cessation programs are shifting consumer attention to vaping as a smoking cessation tool. Changes in import regulations and stricter product standards mean that only certain compliant products can legally enter the market, creating demand for high-quality, approved options that meet TGA therapeutic goods standards. Policy reforms and parliamentary inquiries continue to explore opportunities to improve the prescription model or expand access in a tightly controlled retail environment, while global policy trends, inspired by the UK's liberal approach and New Zealand's retail-focused model, are influencing Australian policymakers' long-term strategies for balancing public health protection with access to harm reduction.
E-cigarette market segmentation in Australia:
The report segments the market into the following categories:
Product Information:
- Modular electronic cigarette
- Rechargeable electronic cigarette
- New generation electronic cigarette
- Disposable electronic cigarette
- Tobacco
- Botanical
- Fruits
- Sweet
- Drink
- Other
- Automatic electronic cigarette
- Hand-held electronic cigarette
- Specialized e-cigarette stores
- Online
- Supermarkets and hypermarkets
- Tobacco shop
- Other
- Australian Capital Territory and New South Wales
- Victoria and Tasmania
- Queensland
- Northern Territory and South Australia
- Western Australia
• July 2025: The Therapeutic Goods Administration introduced new standards for nicotine vaping products. Enhanced compliance requirements for therapeutic goods: Prescriptions for certain products or brands that no longer meet the updated standards will no longer be available after 1 July 2025. Prescribers will be required to refer to TGA-approved vaping product lists to identify compliant therapeutic vape products. This will fundamentally change the standards for quality assurance, product availability and safety in Australia's regulated vaping market, and will separate legitimate pharmaceutical products from unregulated alternatives.
• July 2024: The Australian Government implemented historic reform, restricting the sale of vaping products, regardless of nicotine content, to pharmacy channels only, fundamentally transforming distribution networks and access points. This comprehensive regulatory change aims to restrict youth access, reduce the social acceptability of vaping, and position e-cigarettes solely as therapeutic tools for smoking cessation and nicotine addiction management, rather than as lifestyle products. This is one of the most significant changes to Australian tobacco control policy, affecting the retail, wholesale, and distribution sectors.
• October 2024: Expanded pharmacy access allowed adults 18 years and older to purchase vapes with nicotine strengths of 20 mg/mL or less from participating pharmacies without a prescription where permitted by state and territory laws, while maintaining the requirement for mandatory consultation with a pharmacist. This regulatory change balances accessibility for adult smokers seeking smoking cessation tools with youth protections by creating more convenient access routes and maintaining professional supervision by healthcare providers rather than convenience retailers or specialist vape shops.
• March 2024: The Australian Government amended the Excise Duty Tariff (Tobacco) Act 2024 and the Customs Duty Tariff (Tobacco) Act 2024 to increase taxes on tobacco products by 5% annually for three years, along with standard indexation, to reduce tobacco consumption by increasing excise duties and helping to reduce smoking among the Australian population. This policy creates significant economic incentives for price-sensitive smokers to seek alternative options, including prescription vaping products available through pharmacy channels, demonstrating the Government's commitment to comprehensive smoking cessation strategies.
• 2025: Cancer Council data shows that e-cigarette smoking rates among 18-24 year-olds have fallen from 20% in 2023 to 18% in 2025. Showing the first results of comprehensive vaping reforms in Australia, implemented in July 2024. The Generation Vape Wave 8 survey found that 85.4% of young people had never vaped, and smoking rates reached their lowest levels in any survey wave, with 94.0% reporting never having smoked. This suggests that the pharmacy-only sales model and advertising ban are effectively limiting young people's access to and social acceptability of vaping, while interest in vaping continues to decline, with less than a third of those surveyed expressing interest.
Competitive environment:
The industry competitive landscape was also examined, as well as profiles of key players operating in the modular, rechargeable, next-generation e-cigarette and disposable e-cigarette segments, covering tobacco, herbal, fruit, sweet and flavored beverages distributed through specialist retailers, online platforms, pharmacy channels and authorized retailers compliant with Australia's Prescription Medicines Access System and the TGA's Therapeutic Goods Rules.
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