Unwavering shopper demand for quality products and value means retailers should pay particular attention to the tobacco category.
Tobacco is a key category for independent retailers, evidenced by its popularity despite the difficulty economic challenges consumers have been facing.
In Scotland, as indeed in the whole of the UK, a shift towards low-priced propositions is apparent across the entire tobacco category, with 21.2% of Factory-Made Cigarette (FMC) sales being in the value sector, and 27.1% of Roll-Your-Own (RYO), according to EPOS SPOT Shares.
Roll-your-own strength
RYO sales have experienced a significant increase lately, as economic woes persist across all households; it now accounts for nearly a half (46%) of all tobacco sales, according to the ITUK Report on Trade.
“As the cost-of-living crisis continues, it’s likely that the need for value products is going to continue to be a dominant trend in the category for some time, so retailers need to make sure they can cater for this demand by stocking the right product offering,” Yawer Rasool, Consumer Marketing Director UK & Ireland at Imperial Tobacco, explains.
“With this in mind, we strongly advise that retailers check that they stock a wide range of leading roll-your-own brands, including Riverstone and Players JPS, so that they are fully prepared for this continuing rise in demand for value tobacco products.”
Late last year Imperial Tobacco announced the limited-edition return of 32g packs of Riverstone rolling tobacco in a bid to help independent retailers cater for the rising demand for value-priced tobacco products.
With demand for RYO growing, the tobacco accessories sub-category is also benefitting from the lift in sales.
According to recent figures from EPOS and ITUK, filter tips are worth £114m of sales, and while regular papers account for £44m, king-size papers and combi papers are also proving to be popular at £29m and £33m respectively.
- Staying on top of any new trends within the tobacco category can be a great way to ensure maximum sales impact. Value products, for example, are much more popular at the moment than premium products, given that many consumers are looking to reduce spending, so retailers need to ensure they are responding to this trend in order to grow their sales.
- Retailers should analyse their sales data and talk to their customers on a frequent basis to understand what product they are looking for and purchasing often. Once retailers understand this, then they can tailor their range accordingly.
- Making sure that stock levels are continuously maintained is also key to improving sales. If retailers run out of popular products, it can be costly, particularly within a category that is mainly driven by brand loyalty.
In fact, according to Imperial Tobacco, there continues to be a shift in favour towards combi-packs which offer added convenience and value for money, with both tips and papers in one pack.
“With this in mind, we have just launched a new Rizla Classic King Size Combi variant to help retailers capitalise on the growing demand for natural rolling papers with the added benefit of papers and tips in one pack for the ultimate convenience,” Rasool adds.
The new Rizla Classic King Size Combi includes 32 unbleached king size papers and tips to appeal to the rising number of smokers looking for more natural papers.
OCB is also accelerating NPD, introducing its OCB Authentic Real Rice paper, made from a blend of rice and organic hemp. Propelled by the big growth the Slims & Tips sub-category is also recording (with value sales upwards of £32m, according to Circana), the brand aims to both retain existing customers and attract new ones to the RYO fixture.
“Shoppers are more demanding than ever, looking for quality and value in every purchase. Top-quality products, displays and innovation are important, complemented by broad availability and distribution, but the importance of a competitive price point should not be under-estimated,” Gavin Anderson, Sales & Marketing Director at Republic Technologies UK, explains.
Imperial Tobacco has launched a new Classic Combi variant for its Rizla brand. The new launch, featuring unbleached papers and tips, will allow retailers to capitalise on the growing consumer demand for natural rolling papers with the added benefit of papers and tips in one pack for ultimate convenience.
Available now with an RSP of £1.30, the new Rizla Classic King Size Combi includes 32 unbleached king-size papers and tips to appeal to the rising number of smokers looking for more natural papers.
Factory-made appeal
Familiar brands at a lower price point could also play a big role in the FMC category, where the need for value-focused products continues to increase.
“We recently announced the extension of our popular Players range with the launch of Players Max to enable retailers to cater to the ongoing demand for value tobacco,” Rasool adds. “Players Max features cigarette sticks that are 12% longer in size and contains a new intense blend, which was shown to be a popular and preferred choice in our consumer testing thanks to its full tobacco taste.”
Imperial has also recently announced an updated variant to its L&B Blue New Crush line, boasting a new ‘Fusion’ large-bore filter. “The New Crush Fusion range also features a white tip for the ultimate contemporary look and feel, a resealable foil to guarantee continuous freshness, as well as special tipping paper to provide the innovative cooling sensation,” Rasool notes.
October 2023 saw the UK government propose new legislation that would ban future generations of adults from ever legally being sold tobacco products. The Generational Smoking Ban, which is proposed to come into force in 2027, will mean that anyone born on or after 1 January 2009 (turning 14 this year or younger now) will never be able to be legally sold cigarettes. Industry trade associations and retailers alike have expressed deep concerns that the move will open the retail trade up to a number of new burdens, including age verification challenges, crime and an increase in the illicit trade.
