It looks exactly the same as a normal ciggerette, and you inhale smoke (well steam vapour) like a real ciggerette, only difference is it dont contain nicotine.
I think its a comfort to people who are stuck in the habit and to make giving up not so much of a huge life and habit change.

Tbh anything that helps is great, its difficult giving up.

Hers a vid of it in action..

YouTube - new model of electronic cigarette