While value for money and roll your own products continue their dominance on retailers’ tobacco gantries, it is the premium end of the market that has been the focus for several manufacturers as of late.
JTI and Scandinavian Tobacco got the ball rolling by identifying various opportunities for independents to boost trade in cigars, urging businesses to take advantage of declining supermarket sales and focus on smokers buying cigars over the summer.
And this week has seen further support for two premium priced brands. JTI will celebrate Camel’s 100 year anniversary with limited edition packs and a trade competition offering a trip to New York, while Philip Morris unveiled its first capsule cigarette in the UK in the shape of Marlboro Ice Blast.
In each instance, the message coming from these companies is clear – premium tobacco remains an important category and offers higher margins and profits to retailers compared to lower-priced brands.
Newsagents and c-store owners I have spoken to on the matter have welcomed it cautiously, especially since many say their shoppers are continuing to trade down to more affordable brands.
Shaid Hussain, owner of Good News in Burton on Trent, speaks for many retailers when he says manufacturers must work even harder to get new products on his two metre gantry.
But he adds: “With the dark market in supermarkets, it seems tobacco companies are trying to get as many products out to independents as they can, so it could present some opportunities for us in the future.”
With major manufacturers investing heavily in this sector, retailers who have enough space and consumer demand to justify widening their premium tobacco range stand to win big this year.