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June 23, 2015

Cigarettes' Future Troubled as Alternatives Advance

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Of the top ten cigarettes markets in the world, only three (all in Asia-Pacific) are expected to see volume growth by 2019 as increased regulation, taxation, health awareness and the emergence of alternatives such as e-cigarettes impacts sales. To be sure, taxation drives value sales and markets such as South Korea and Russia will be able to balance their volume declines with revenue growth over the same period.

The E-Cigarettes Market: Past, Present and Future

Demand for alternatives for traditional combustible and smokeless tobacco products has surged since 2005 when electronic cigarettes first appeared in the US and Chinese markets. Now, sales of vapour products have eclipsed nicotine-replacement products. This video tracks the evolution of this young industry and provides forecasts for the future. Watch the video for complete insights.

June 22, 2015

Vapor Devices and e-Cigarettes in the Global Tobacco Market

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Cigarettes’ Troubled Future as Alternatives Steam Ahead

Zora MilenkovicAnalyst Insight by Zora Milenkovic - Head of Tobacco Research

Like a snail with the baggage of its history/legacy of legislation on its back, the world cigarettes market slowly toiled downhill in 2014, recording a barely there volume decline of -0.4% and continuing its downward trajectory in every region of the world bar Asia-Pacific (only kept in the black itself by the behemoth that is China dragging the region, and indeed the world, with it).

Volume declines in cigarettes as price becomes main battleground

Cigarettes’ volume decline in developed markets belies the furious pace of manufacturer activity in the category, with fast-paced changes in pricing strategies as pricing becomes increasingly the main company battleground around the world. The era of cigarettes pricing being set across regions is long gone, each country warrants its own specific approach with sub-brand variants appearing under various price band cloaks and innovation applied to each level of pricing as brand owners seek to maintain value sales and thwart down-trading, either to cheaper brands or adjacency categories, or even illicit (which saw an increase of 4% globally, excluding China).

Continue reading "Cigarettes’ Troubled Future as Alternatives Steam Ahead" »

June 11, 2015

Adris Grupa Sells Tobacco Unit to British American Tobacco

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On Saturday 30 May, 2015, Adris Groupa officially signed over their tobacco unit to British American Tobacco in one of the largest acquisitions in Croatian history.  This podcast examines the factors motivating the company to sell, the Croatian tobacco market, and the future trajectory of Adris Groupa.  Listen for complete insights.

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May 12, 2015

Brazil's Business Environment: Consumption in Economic Slowdown

250_brazilBusiness-v1.0On the surface, Brazil looks like an attractive market. It is the seventh largest global economy and has a population of 200 million, with high consumer expenditure and high demand for commodities.
But Brazilians are spending less, industrial confidence is deteriorating, and inflation is rising, meaning a future of slow growth and economic recovery.

Consumer goods companies operating in Brazil need to adapt their strategy to integrate the global market place. What are the reasons behind this slowdown and how can organisations work it to their advantage? 

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› How Brazil’s rapid currency depreciation has affected its economy and consumers 

› Which consumer industries are slowing down and which have new opportunities

› Why the middle class is changing Brazil’s economic landscape

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April 30, 2015

Japan Tobacco Inc Fights to Stay Relevant

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Analyst Insight by Eric Penicka - Research Analyst

Japan Tobacco Inc's (JTI) announcement Thursday, 30 April 2015, to acquire LOGIC Technology Development LLC should hardly come as a surprise: JTI has long been on the sidelines of the US tobacco market, representing less than 1% of cigarette volume sales in the US. With Lorillard Inc acquiring blu e-cigarettes in 2012 (now pending a divestiture to Imperial Tobacco Group) and Reynold American Inc and Altria Group nationally launching Vuse and MarkTen, respectively, in the US, JTI is indicating they have not folded on the US tobacco industry quite yet. By acquiring LOGIC e-cigarettes, JTI positions itself in the midst of their competitors, jockeying for market share in the world's largest vapour device market and also the fastest growing segment of tobacco in the US.

While clearly a strategic move, the acquisition could have negative repercussions for one of America's leading e-cigarette brands. LOGIC e-cigarettes can attribute some portion of their success to independence from the tobacco industry. Along with competitor NJOY Inc, LOGIC has been able to appeal to former cigarette users in a way traditional tobacco companies simply cannot. With no affiliation to traditional cigarettes, LOGIC and NJOY have been able to market themselves as wellness oriented companies whose goal is to assist cigarette users in quitting tobacco. If acting as a subsidiary of JTI, it is unclear how cigarette users hoping to quit will perceive LOGIC e-cigarettes.

March 12, 2015

What does the Plain Pack Ruling mean for the UK and Irish Tobacco Markets?

Even though there has been much debate over plain packaging in the tobacco industry, until now it has been isolated in the Australian market. With this new ruling in the UK and Ireland, we anticipate plain packaging legislation to pass in other major markets in the near future. By our estimate, plain packaging in Australia has cut down on smoking prevalence by 45% since its introduction to the market four years ago. This legislation will make the operating environment much more challenging for the tobacco industry moving forward. Watch the video for complete insights.

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March 7, 2015

Greece Could Raise A Billion Euro A Year If It Eliminates the Illicit Cigarette Trade

Shane_MacGuillAnalyst Insight by Shane MacGuill - Tobacco Analyst

But that’s the proverbial big ‘if’. According to various reports the freshly elected government of Greece led by the left-wing Syriza party has agreed terms with the Eurogroup on Tuesday morning on a four-month extension of the country’s €240 billion bailout programme. As part of the negotiating process, the Greeks submitted a document giving a number of assurances to Eurozone members summarised by the apparent pledge that the new government’s tackling of Greece's ‘humanitarian crisis’ would have 'no negative fiscal effects'.  The document reportedly outlines a plan to increase state funding by strengthening the country’s currently very weak tax enforcement and combating corruption including (but by no means exclusively) by cracking down on the illicit trade in tobacco - so what is the scale of Greece’s illicit tobacco trade and crucially how much could potentially be raised by eliminating it?

Continue reading "Greece Could Raise A Billion Euro A Year If It Eliminates the Illicit Cigarette Trade" »

March 4, 2015

The Rising Power of Female Consumers

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The global female population totalled an estimated 3.6 billion in 2014 and is expected to reach 4.2 billion by 2030. Average disposable income amongst women is the highest it's ever been, and women are living longer than men.

What are you doing to reach this growing market?

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View now to learn:

  • The size and distribution of the female consumer market
  • Literacy and education rates
  • Labour participation
  • Purchasing power

 

Continue reading "The Rising Power of Female Consumers" »

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Recent Posts

Cigarettes' Future Troubled as Alternatives Advance

The E-Cigarettes Market: Past, Present and Future

Vapor Devices and e-Cigarettes in the Global Tobacco Market

Cigarettes’ Troubled Future as Alternatives Steam Ahead

Adris Grupa Sells Tobacco Unit to British American Tobacco

Brazil's Business Environment: Consumption in Economic Slowdown

Japan Tobacco Inc Fights to Stay Relevant

What does the Plain Pack Ruling mean for the UK and Irish Tobacco Markets?

Greece Could Raise A Billion Euro A Year If It Eliminates the Illicit Cigarette Trade

The Rising Power of Female Consumers