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Juul: A Networked Coordinated Game

Juul Labs, the company producing the small “USB-shaped” e-cigarette has been at the receiving end of public backlash for the past few months.  The company created the Juul with the original intent of having the device serve as an alternative to smoking cigarettes, that did away with the harmful tobacco and other ingredients that typically make up a cigarette.  However, the Juul had vastly unintended consequences: it introduced millions of teens to nicotine.

The result was the explosion in Juul Lab’s share of the e-cigarette market (as seen in Fig 1) – a market which “grew by 40%, to $1.16 billion” in 2017 alone.  This scenario describes one of the most successful orchestrations of a cascade in years. What Juul seemed to do so well was to target to most connected nodes in the market: young people on social media.  By putting out colorful advertisements of millennials enjoying Juuls and having a good time together, Juul was slowly but surely adding value to their product. In other words, imagining that all nodes in the market had a choice between purchasing/using Juul (choice A) and not purchasing/using Juul (choice B), then Juul was slowly adding value to choice A with these advertisements.  As Christophe Haubursin points out in his article “Juul, the vape device teens are getting hooked on, explained,” Juuls are “very lightweight and portable, super easy to charge and refill, [and] low-maintenance,” characteristics that only added to their ease of diffusion.

To me, it seems like the biggest value added to “choice A” was the social status associated with being a user/owner of a Juul: the scenario plays out much like a networked coordinated game where the payoff for two nodes choosing A (using/owning Juul) was much greater than two nodes choosing B (not using/owning Juul).  We know that a bigger A leads to a smaller q value, which, in turn, leaders to a smaller F (fraction of neighbors choosing A) needed to switch to choice A. What finally made this cascade succeed, I theorize, is Juul’s targeting of the most connected of nodes, that would be able to increase the F number of as many nodes as possible.  With choice A having such a high value built up by targeted advertisements and early adopters, it was easy to obtain a F value that overcame q and thus spread the Juul endemic further through the network of young adult nodes.


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November 2018