The tobacco market is currently worth £14bn before tax per year, Imperial Tobacco figures reveal.

This is divided almost evenly between Factory Made Cigarettes (FMC) and Roll Your Own (RYO) categories, at 52% and 48% respectively (Imperial Tobacco).

There is continued movement towards low priced propositions across the entire category as consumer demand for value continues to drive tobacco purchasing patterns.

As part of this shift, the lower price tiers now account for the majority of sales, with the sub-economy segment making up 63% share of FMC, and the economy segment accounting for 56% of RYO, with these value segments growing at 3% and 5% YOY (Imperial Tobacco).

“In order to effectively harness the sales opportunities this presents, retailers must be equipped with the right products and importantly, the right knowledge, to help their customers navigate the tobacco category,” comments Tom Gully, Head of Consumer Marketing UK&I at Imperial Tobacco.

In the RYO category, the consumer drive for value remains a big factor, with the economy segment accounting for 56% of sales, and mid-price and premium products comprising 32% and 12% share respectively (Imperial Tobacco).

“Our new Players JPS Easy Rolling Tobacco is a great example of what retailers should be stocking to cater for these increasingly value savvy shoppers,” adds Gully. “Players JPS Easy Rolling Tobacco is an exciting new blend of fine cut tobacco that offers an easier rolling experience and benefits from the brand recognition of one of the UK’s best-selling cigarette brands.”

Players JPS Easy Rolling Tobacco features a more vibrant colour and lower levels of moisture, making the blend easier to handle and to roll. The range is available to buy in 30g and 50g and priced at £13.65 and £22.35, and each pouch includes a set of quality rolling papers.

Another RYO brand that is a must-stock for any retailers tapping into the value trend is Riverstone. The range was recently repositioned to sit within the rising economy RYO segment alongside Players JPS, with its 30g and 50g pouches also priced at £13.65 and £22.35 and including both papers and filters.

“This increasing consumer shift towards RYO products also presents new sales opportunities for tobacco-related accessories,” says Gully. “In order to tap into this trend and take advantage of the incremental sales on offer, retailers should make sure they’re fully stocked at all times on filters, papers, lighters and other flavour-related innovations like Rizla Flavour Cards and Rizla Polar Blast Crushball filters, to cater for the rising number of consumers buying into the RYO segment.”

A few years ago, Imperial launched the Rizla Flavour Infusions range. Rizla Flavour Infusions comprise flavour cards that can be used with traditional factory made cigarettes or roll your own tobacco products.

Smokers simply insert a flavour card into a packet of cigarettes or roll your own tobacco and wait at least 60 minutes, or leave it in longer for a stronger, more intense flavour. Latest figures show they are flying off the shelves and currently selling around 450,000 packs per week (Imperial Tobacco estimates) as consumers look to recreate the menthol experience.

Another area of the accessories market that’s proving popular with these value focused shoppers is combi packs such as Rizla Silver Kingsize Combi which, priced at just £1.20, offers papers and tips together in one pack.

“From an FMC perspective, as demand for value tobacco continues to grow, many consumers are looking for a familiar brand that they know will deliver satisfaction at a low price,” Gully continues. “With this in mind, we recently announced an exciting new launch for our Embassy Signature range to help retailers unlock summer sales amongst adult smokers seeking out top brands.”

Available to buy now, Embassy Signature Silver Edition benefits from special reduced smoke smell paper and features a modern shaped filter and textured tipping paper to provide a unique smoking experience.

The pack has been designed with a resealable ‘fresh protect’ foil feature to maintain product freshness, while the branded trade outer promotes the brands’ modern design with a new luxury embossed sleeve.

The Embassy Signature Silver Edition is available to buy until the end of September with an MRRP of £10.15 per pack of 20s, providing the same value as the original product, but with an elevated experience.

“Retailers are a hugely important route to market for us, representing a significant proportion of our sales,” says Gully. “As such, we continuously invest in supporting retailers so that they can make the most out of our products with sales and trends advice, promotions, store visits and in-store furniture.”

Imperial Tobacco has announced the launch of a new range of limited edition papers in Gold Leaf pouches for 2022.

Launching in July, the new collection of limited-edition papers will be available in Gold Leaf 30g and 50g pouches until the end of September, and priced at £14.60 and £24 respectively.

There will be a series of four distinctive designs themed around the concept of individuality, diversity and creative experiences which will be rotated throughout the launch period, offering a unique experience for Gold Leaf customers.

The Gold Leaf trade outer will also feature a new look including an on-pack flash promoting the limited edition papers to drive further awareness.

Benefitting from a high moisture Virginia blend and a distinctive sweet taste, Gold Leaf provides premium rolling tobacco features at an affordable price.

Tom Gully comments: “As the cost of living crisis takes hold of households nationwide, the Economy price sector is the driving force behind sales within the Roll Your Own (RYO) category, accounting for 56% share of sales and growing at 5% YOY. Offering top quality products at affordable prices that allows retailers to cater for their customers’ needs remains a priority for our business. Through this latest launch, we’re providing the same great value and high quality Gold Leaf blend, with the addition of these engaging new limited edition designs.

“In recent years, we’ve found these limited edition papers have become highly sought after as collectables by RYO customers, so we’d recommend retailers stock up on the new limited edition Gold Leaf pouches as soon as they launch to take advantage of the additional sales while stocks last.”

Gemma Bateson, Sales Director at JTI, comments: “The RYO category has increased year on year, now generating sales of £3.9 billion a year (IRI). Within the RYO category, ultra-value RYO is the fastest growing sector (IRI), so retailers should stock up on products such as Sterling, the UK’s leading Value RYO brand (IRI) and the new Benson & Hedges Blue Rolling tobacco which sits within the ultra-value category.”

New for this year, JTI launched Benson and Hedges into the ultra-value segment to provide retailers with high quality value for existing adult smokers.

Featuring the lowest recommended retail price from JTI, Benson & Hedges Blue, the UK’s No.1 cigarette brand (IRI) has a new rolling tobacco offering, Benson & Hedges Blue Rolling.

“By offering an iconic brand like Benson & Hedges at a new ultra-low price, means retailers can capitalise on the brand heritage, that also offers a competitive price point,” adds Bateson.

Sterling Rolling Tobacco Essential is a less for less alternative, with no filters and papers providing existing adult smokers the freedom to purchase their preferred tobacco accessories.

Sterling Essential Rolling Tobacco comes in a paper insert pouch packaging which contains less aluminium, and the blend generates less leaf waste compared to other RYO brands due to its unique whole leaf blend. Available at an RRP of just £13.65, Sterling Rolling Tobacco Essential 30g offers the lowest price point in the Sterling Rolling family and is a great value tobacco option for customers. The 50g format offers the same fantastic RYO quality at a competitive RRP of £22.35.

“Price remains a key factor for existing adult smokers with 80.7% of all sales volumes currently in the Value and Ultra Value RMC & RYO sector (IRI),” says Bateson. “Over the last two years we have worked hard to bring out products that tap into the growing demand for value tobacco which is why retailers should stock up on products such as Sterling, the UK’s leading value RYO brand (IRI), B&H Blue, the UK’s fastest growing cigarette brand over the last 12 months (IRI), and the new ultra-value RMC range – Mayfair Silver.”

The cigarillo category which has seen strong growth this year, is now worth £8 million a month (IRI) with a 47.1% market share (IRI).

“To capitalise on this growth, retailers should stock up on products such as Sterling Dual Capsule Leaf Wrapped, which is the No.1 cigarillo brand, with a 91.6% share of the UK cigarillo market (IRI).”

Sterling Dual Capsule Leaf Wrapped includes a mentholated Virginia blend tobacco and capsule filter that when crushed releases a peppermint flavour. It offers a good value and high-quality product, with an affordable RRP of of £5.30 for a pack of 10 and £10.40 for a pack of 20 cigarillos.

New for this year, JTI launched two of its most iconic brands into the ultra-value segment to provide retailers with high quality value for existing adult smokers. Featuring the lowest recommended retail prices from JTI, Benson & Hedges Blue, the UK’s No.1 cigarette brand (IRI) has a new rolling tobacco offering, Benson & Hedges Blue Rolling, whilst Mayfair introduced a new RMC range – Mayfair Silver.

Available across all channels now, Benson & Hedges Blue Rolling includes quality Virginia tobacco blend and 100 papers within the 30g and 50g pouches, with an RRP of £13.65/£22.35 per 30g/50g and is available across England and Wales only. Mayfair Silver is available in both King Size and Superking at a RRP of £10.15 per 20 pack, and is available across England, Wales and NI.

Alastair Williams, Country Director at Scandinavian Tobacco Group UK (STG UK), comments: “There are not too many established categories that can say their retail sales value has increased by 12.8% over the last year, but that is certainly the case with cigars, and it now stands at just over £291m (IRI).”

Cigar volume in the same period has also increased significantly, growing by 12.9% to 431.3 million cigars (IRI), underlining the growing importance of the category to retailers.

This stellar performance is largely driven by the fast-growing cigarillo segment, which already accounts for 45.9% of all cigars sold in volume terms, and totals £97m in annual sales (IRI). However, the total category growth has also been supplemented by the continual rise in the medium / large segment, albeit from a smaller base.

Miniatures are still the largest segment within cigars, currently worth just under £104m in annual sales and led by the Signature Blue brand, while the small cigar segment appears to be continuing a slow but consistent decline.

“Aside from the rapid growth of the cigarillo segment over the last few years, the search for value has also been a consistent trend in cigars for a while now, evidenced by the success of our Moments Blue brand, which offers a quality smoke at a low price,” adds Williams. “It is now the sixth best-selling traditional cigar brand in the UK in value terms, and with the continued impact of the increasing cost of living crisis for the foreseeable future, I would only imagine its popularity will continue.”

Whilst perhaps not as prevalent as elsewhere in Europe, flavoured cigars are growing steadily in popularity here in the UK. Menthol cigarillos have exploded in popularity over the last couple of years, but it’s not the only flavour of choice. Last year STG announced a new pack format for the Signature Red Filter brand, which is currently the UK’s best-selling aromatic filter cigar and whose smooth taste and vanilla flavour proves consistently popular with those adult smokers who enjoy an aromatic cigar.

“Of course, the first cigar on any list should be Signature which is by far the best-selling traditional cigar in the UK and very much the jewel in our crown,” says Williams. “But there is more to the Scandinavian Tobacco Group cigar offer than just Signature. We also have Moments Blue as a value offer in the miniatures segment, Signature Action in the fast-growing cigarillo segment, and of course our Henri Wintermans Half Corona holds the position as the UK’s favourite Medium to Large cigar, so if retailers stock these as a minimum, they should be able to perfectly meet the needs of each and every one of their customers.”

It’s certainly more important to stock the right range rather than a broad range, as the top ten cigar brands account for over 90% of sales (IRI).

Miniatures remain the engine room of the category, so it is important retailers get this segment right.

By far the biggest player here is our Signature range, which is ably supported by our Moments brand, which offers a good quality smoke at a cheaper price. Aside from cigarillos, retailers also need to consider brands in both the Small and the medium/large segments to ensure they are covering their bases, so think about including the top-selling brands from each segment as a minimum.

“At STG we consider ourselves as the ‘cigar category champions’, meaning we work closely in partnership with all our multiple grocer customers, from offering promotional support, to visiting head offices providing up to date advice on adult cigar consumers’ smoking habits or assessing inventory levels in order to maintain continuity of supply,” concludes Williams.

The increasing shift to roll your own amongst smokers is continuing to provide major profit opportunities for convenience retailers.

The UK tobacco accessories category is currently worth £324 million and continues to show YoY growth, currently at +4.8% (IRI), highlighting the importance for retailers to tap into these sales.

Gavin Anderson, Sales & Marketing Director at Republic Technologies (UK) Ltd, says: “Cash conscious shoppers are turning to more affordable RYO products as a way of saving money, versus factory made cigarettes.”

The pandemic and subsequent lockdowns brought more shoppers than ever to local convenience stores, as people chose to stay local and minimise supermarket visits. This gave retailers an even bigger opportunity to drive visibility of margin-boosting tobacco accessories products.

“By ensuring they are fully stocked with a range of tobacco accessories from trusted brands, retailers can cater for every customer and drive sales. As category specialists, we’re continuing to innovate. Not just with NPD but with a renewed focus on merchandising solutions, enabling retailers to highlight NPD and increase visibility of best-selling products,” adds Anderson.

“Our iconic brands – including Swan, Zig-Zag and OCB – have considerable history in the market and are synonymous with quality and value for money. This, combined with our team’s valuable expertise in the category, means that we are well placed to add real value to convenience retailers.”


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