Retailers urged to stock budget-friendly tobacco products
INFLATION and household costs are soaring, meaning consumers are keeping an eye on their pennies more often now as a result.
And this isn’t likely to slow down any time soon, so stocking up on some good-for -value products will be key for c-store retailers.
This factor is even more important for tobacco shoppers, according to Tom Gully, head of consumer marketing UK&I at Imperial Tobacco, who noted the rise in sales for cheaper options across the category.
“We’re seeing a move towards low-priced propositions across the entire category as a whole, resulting in the lower-cost tiered products making up a majority of tobacco sales.
“In fact, the sub-economy segment now makes up 63% of factory-made cigarette sales, while the economy segment accounts for 56% of roll-your-own, with these value segments growing at an impressive 3% and 5% year-on-year,” he said.
To capitalise on this, Gully has recommended retailers ensure they are well stocked on the right products, such as the firm’s Riverstone and Players JPS RYO papers, as well as other accessories to grow sales in the category.
With the greater number of consumers choosing RYO, Gully mentioned that the opportunity for accessories will only grow with it.
So he is advising retailers to stay stocked up on filters, papers, lighters and other “flavour related innovations” – such as Imperial’s Rizla flavour cards.
Gully said: “The Rizla Xtreme range comprises flavour cards that can be used with traditional factory-made cigarettes or roll-your-own tobacco products.”
While many will look to cheaper alternatives with tobacco, other consumers may look to seek out alternative nicotine solutions altogether during this time, too, making the growing vape market key for the convenience retail channel.
Research from the ECig Intelligence Database found that the vaping category is set to grow to a worth of £1.47 billion in the next three years, with around 35% of current vaping sales taking place in the convenience channel.
As such, Gully said that retailers looking to tap into this category need to ensure they are stocking the right range for their customer base, whether that be through pod-based vapes such as the firm’s MyBlu range or disposables with its newly launched Blu Bar range.
“Recent data shows that both closed pod systems and basic open systems remain popular choices for vapers, accounting for 70% of the total UK vaping market size in 2022.
“But although these devices account for a large majority of the share, we’re also seeing significant growth in the disposables category, which is currently worth around £132 million and makes up 10% of the market share – up from 5% in 2021,” he said.
