Once an iconic brand on every Scottish tobacco gantry, Kensitas Club aims to return to its former glory days thanks to a full relaunch of the brand at a much reduced RSP of only £7.65. Woodlands Local is working with brand owner JTI to examine the challenges of relaunching a major brand in a dark market.
Once upon a time the Kensitas Club cigarette brand counted itself among the icons of local retailing in Scotland. Anyone over the age of 40 or 50 will no doubt remember the striking blue and gold packs and the frenzied collection of the famous ‘Kensitas Coupons’ that shoppers received every time they bought a pack. The Kensitas Coupons were redeemable for a wide range of consumer goods and it’s probably fair to say that the scheme was one of the original mass participation loyalty schemes in the industry.
For reasons not entirely well understood, Kensitas Club – or Club as it was shortened to – was far more of a hit in Scotland than it was across the rest of the UK. The full flavour that characterises the brand undoubtedly played a part but the overwhelming success of the brand was something that brand owners JTI were obviously very happy to see.
Over the years however, as consumption patterns changed, a flood of NPD hit the market and competition intensified, the brand slowly lost market share. The seismic shift to value cigarettes in the last decade or so effectively meant that Club became a niche premium brand, albeit with a very loyal following.
That’s certainly how the brand performs in Woodlands Local. It’s a long way down our list of top selling cigarette lines by volume although it does have a small base of shoppers that will settle for nothing else and buy the product regularly.
New price, new variant
All that is set to change, however, with a full relaunch of the brand, complete with the introduction of a Superkings variant and, most eye-catchingly of all, a huge reduction in RSP way down to just £7.65.
It’s a move that has been making waves in the local retailing sector since news of the relaunch first began filtering out.
The Kensitas brand is in fact over 100 years old, making it one of the oldest cigarette brands still in production. As mentioned above, it quickly gained a loyal customer base in Scotland and that remains true to this day. Club still over-indexes in Scotland, albeit at much lower volume levels.
The Kensitas Club brand first hit gantries in the 1970s and for decades since has been offering smokers a premium tobacco experience. This latest move is an innovative attempt to revitalise the brand and make that premium experience available to a far wider audience, competing at the value end of the market but with a premium product.
What does it mean for retailers?
The most obvious question that most retailers first asked themselves when they heard about the change was what it would mean for their profits. The primary concern would be over the potential lost revenues from suddenly charging only £7.65 for a product that used to retail for an RSP of £10.55.
But JTI have anticipated that concern and are confident that the loss of revenue per pack will be more than compensated by the increase in sales of the previously premium-priced product at the significantly lower price point.
Andy Stevens, JTI Head of Sales, told SLR: “Scotland’s cigarette industry is worth an estimated £1.5bn [Nielsen, Sep 17] and the demand for exceptional quality, low prices, and a wide choice continues to grow. Kensitas Club is an iconic brand and most existing adult smokers will be aware of its incredible heritage and superior quality. We’re confident that the new lower RSP will offer existing adult smokers a unique combination of a premium tobacco experience and a great value price.
“We’re dedicated to providing retailers with a competitive product range, in line with market trends, and are confident that the drop in RSP along with the introduction of Superkings to the Kensitas Club portfolio, will help retailers drive incremental sales. We firmly believe retailers will benefit from this move, as well as the addition of a Super Kings 20s variant which further broadens the appeal of the brand.”
Clearly, the biggest problem facing manufacturers and retailers when it comes to launching or relaunching tobacco lines is the severe restrictions placed on the category which make it very difficult to communicate with the shopper.
By pitching the brand as the cheapest on the gantry, or thereabouts, Kensitas Club clearly aims to target existing adult smokers looking for great value who would see the option of a premium product at a value price as a great combination.
There’s no question that is a bold move from JTI – but it’s based on sound logic. The vast majority of products at the cheapest end of the market trade exclusively on price. Kensitas Club is trading on a strong combination of value price and premium product.
But will customers buy it? That’s what we’re aiming to find out in Woodlands Local. We are now stocking the existing King Size and the new Superkings Club lines and we will track how the brand performs over coming weeks and months.
We’ll report back with Epos data and anecdotal feedback from both customers and staff. It should be an interesting project. See the Woodlands Local pages in next month’s SLR to find out how we’re getting on.