RN What are the key trends retailers need to be capitalising on in the tobacco and vaping category to maximise sales, and how do you see these developing?
Ross Hennessy There are two clear tobacco trends right now: the increasing growth of the value segment, which in turn has seen the roll-your-own category grow by 7% year on year, and the rising popularity of capsule cigarettes.
Sales data also shows a noticeable shift towards the 50g pouch format in the past year. Being aware of the most recent market trends and evaluating their range accordingly will see retailers maximise sales.
In the vaping category, capsule and refillable devices are the clear winners, now used by 91% of UK vapers. Retailers should also be aware that lower-strength e-liquids are growing in popularity. They now account for 26% all e-liquids sold.
RN Looking at the category over one year after the EU Tobacco Products Directive II came into force, what are sales looking like for the future?
RH One year on and sales remain strong – in fact, the latest data shows no significant impact on tobacco sales in the UK. Tobacco is the biggest FMCG category, worth £14.4bn, and there’s still a massive opportunity. Retailers that continue to invest in the category will reap the rewards, and JTI continues to invest significantly in product innovation and our support for retailers looking to maximise their tobacco profits.
RN What are your top three tips for retailers to help improve tobacco sales?
RH The key to success lies in getting the basics right – range, price and customer communication. Retailers will immediately improve their tobacco sales by stocking a wide range of bestsellers and new products across all the key segments and ensuring that these are always in stock; selling at the RRP or below; and training staff so they are knowledgeable enough to talk to regular customers about the product range.
RN How is JTI supporting retailers to help them increase sales?
RH We invest significantly in our extensive UK sales force, providing them with regular training and the latest market information, which they pass on to the retailers they support and advise every day.
We also have a nationwide network of specialist ‘Logic Champions’, who work within our sales force with the specific aim to help retailers understand and sell reduced-risk products such as e-cigarettes.
Our trade website, JTIAdvance.co.uk, also offers 24/7 access to a wealth of information, advice and category insights.
Of course, we are also continuing to invest in our successful range of brands, launching new product innovations that enable retailers to meet customer demand and increase sales.
RN What new products have you bought to market this year, or plan on launching?
RH So far this year we have launched two new Sterling Dual cigarettes – Sterling Dual Superkings and Sterling Dual Double Capsule King Size – both of which tap into the growing capsule segment. We have also added a capsule variant to the B&H Blue brand.
In the vaping category, we recently launched a new Logic LQD e-liquid bottle with a lower price of £3.99. With the growing popularity of refillable and e-liquid products, this launch extends the opportunity for retailers to maximise sales in the fastest-growing segment within the vaping category, as well as capitalising on the increasing consumer trend for value.
Retailers can expect to see further new product development and innovation from JTI and Logic later this year.
RN What does the future look like for the tobacco and vaping category overall?
RH The future looks strong and JTI is investing significantly in both the tobacco and vaping categories to help retailers maximise the opportunity they present.
Our dedicated insights team closely tracks market trends, so we can provide retailers with new, innovative tobacco and vaping products, reacting quickly to changing consumer demands to enhance and evolve our range.
We also remain focused on working closely with retailers to support and grow their businesses alongside ours, for the long-term.