The vape category has grown to be worth around £1.2bn in the UK, with 38% of vaping volume sales taking place in the Convenience channel and 18% in Wholesale, Imperial Tobacco estimates.

As demand for vaping products continues to grow, dedicating ample space to vaping products within depots should be an important area of focus for any wholesaler.

As a result of the Covid-19 pandemic, many customers started shopping locally or online, in part because they are less willing to go far from home for their products.

“If wholesalers can support retailers with advice on which vaping products to stock to ensure they have a strong range of vaping products that are displayed well in store, and supported by knowledgeable staff, there is an opportunity for convenience stores to retain customers of vape products that might have previously shopped elsewhere (such as specialist vape stores),” comments Tom Gully, Head of Consumer Marketing UK&I at Imperial Tobacco.

As a result of the ban on characterising flavours, some consumers have been looking to vaping to fulfil their flavour needs.

“In fact, our best-selling variant in the myblu range is the Menthol Intense Liquidpod so we would highly recommend this as a must-stock for all wholesalers,” says Gully.

Figures show that pod systems and cartridges have seen the most year on year growth across all channels and within Wholesale specifically, closed devices, such as myblu, are the most popular, accounting for 3.1% of volume share, vs. 1.4% for open devices, Imperial Tobacco estimates.

One of the main factors driving the popularity of pod-mod systems like myblu is their ease of use, with the device’s hassle free Liquidpods allowing vapers to switch between flavours in seconds via a simple one-step ‘click and go’ system.

“With this in mind, we’d strongly recommend including a leading pod-mod system such as myblu within the range to tap into this trend,” adds Gully.

The myblu pod-mod device is one of the brand’s leading vape products. The device combines the performance demanded by experienced vapers with the ease-of-use appreciated by new entrants to the category. The device’s hassle free Liquidpods allow vapers to switch between flavours in seconds via a simple one-step ‘click and go’ system.

“We work closely with our wholesale customers through a range of tactics, including promotions, to help them maximise their sales of vape products and ensure they are offering the right products to cater for their retail customers,” Gully comments.

Darren Griffin, UK Country Manager at ZYN, comments: “Following the ban on menthol cigarettes, consumers have become more open to reduced-risk products which we’ve seen reflected in the tremendous growth of the nicotine pouch industry over the last 12 months.

“Interestingly, despite the menthol ban, consumers still desire the tobacco flavour which we found to be the most popular choice of taste for nicotine pouch users (Catalyx) and have consequently just launched our first tobacco flavour to meet the demands of these consumers.”

Being completely tobacco-free, ZYN’s Tobacco Gold delivers nicotine in a less harmful way than smoking due to ZYN being made up of pharmaceutical grade nicotine and food-grade products.

Whilst nicotine pouches are less harmful for those who are looking for a smoke-free and tobacco-free way to consume nicotine, the category is relatively new to the UK market which highlights the need to educate nicotine users on the harm reduction from switching from traditional cigarettes to nicotine pouches, particularly for those who worry about second-hand smoking.

The smokefree market is growing at a phenomenal rate, with the nicotine pouch category tripling in size from 2020 to 2021 and is forecasted to more than double again in 2022 (Nielsen). Nicotine pouches are the fastest growing category across the nicotine industry and growth is only predicted to escalate over the foreseeable future.

More precisely, the nicotine pouch category has seen a weekly CAGR of 1.8%, an average monthly growth rate of 8% and in 2021 is forecasted to grow to a CAGR of 206% from 2020 volumes (Nielsen).

“From a societal perspective, it’s important to note that the government continues to aim for the UK to be a smoke-free society by 2030 and legislations across the UK continue to crack down on public smoking,” adds Griffin. “This also includes the use of e-cigarettes which have been deemed as less harmful, so limits the options for consumers trying to alter their nicotine consumption. That said, nicotine pouches can be consumed anywhere, regardless of whether you can vape or smoke.”

Where the majority of vaping and nicotine pouch brands include a vast amount of flavours to appeal to a wider audience, ZYN found that the most popular flavour amongst nicotine users was still tobacco which showed a real need to supply a reduce-risk option in this flavour for those who may no longer wish to consume tobacco itself.

Although still relatively new to the UK market, tobacco-free nicotine pouches have continued to gain popularity, following a huge uptake in the USA who now sell over 100 million ZYN cans each year. In the UK, there is a significant rise in the demand for tobacco-free, smoke-free alternatives too.

ZYN has recently introduced Tobacco Gold, a sweet tobacco flavour with a taste of dried fruit, wood and caramel tobacco flavour following consumer demands and insights that found this still to be the most preferred flavour.

Across the nicotine pouch category, mint flavoured pouches currently make up 77% of the total market volume with ZYN’s Cool Mint range having been the most popular flavour and consequently having the widest variety of strengths (3mg, 6mg, 9mg).

In 2021, ZYN’s Cool Mint in 9mg strength was introduced to help meet the demands of the consumer as 70% (Nielsen) of nicotine pouch sales are in this strength or higher.

In May ZYN launched Tobacco Gold which is a tobacco flavoured, but tobacco-free nicotine pouch in strengths medium (3mg) and strong (6mg), designed for nicotine users who do not wish to consume tobacco, but still enjoy the taste.

The nicotine pouches have a sweet tobacco flavour with a taste of dried fruit, wood and caramel and addresses the demands of consumers, as tobacco has become the most desired flavour in the category. As a decline in cigarette smoking continues, Tobacco Gold is a reduce-risk solution for cigarette smokers who not only want to prevent the consumption of tobacco, but also enjoy a nicotine kick in smoke-free environments.

Ebrahim Kathrada, Aquavape Managing Director, comments: “We’ve seen a big drive from tobacco to vaping following various government legislation, and the team at Aquavape has prepared ourselves for that. Menthol and mint vape products were responsible for almost 60% of all growth in the category.

A survey reported that menthol flavour is one of the most popular flavours in the UK, only second to fruit e-liquids.

Aquavape has a vast menthol range of disposables, liquids, short fills or pods to support former smokers who’ve transitioned to vapes.

The Chancellor of the Exchequer increased taxation on tobacco to stop the British smoking. The rising costs of cigarettes are another reason why more smokers are switching to vaping, as it’s the cheapest way to smoke.

A study reported that in 2019, 30.2% and 37.7% of vapers bought from vape shops and other retail locations, respectively. The growth of vaping sales in the convenience channel was inevitable as specialist vaping shops were forced to shut over lockdown.

“I suspect that now, post-lockdown, vapers are more inclined to continue purchasing their vaping products from convenience stores, as c-stores have longer opening hours and have other essential products for sale all in one place,” adds Kathrada.

In the past, when the vape market was worth £1.5 billion, a quarter of that amount was going through convenience stores.

“As we’ve gotten more and more data, we’ve seen that percentage increase as convenience stores have taken the category more seriously and have expanded their range of offerings, says Kathrada.

Chris Carr, Sales Director at EDGE Vaping, comments: “The insights we have available show us that the number of smoking prevalence has dropped significantly since the time the ban came into effect, with 18-24 year olds, and 25-34 year olds showing the biggest fall in 2020 (the same year the ban took effect). While it is certainly feasible to estimate a percentage of these people will have transitioned to an alternative like vaping, the data does not yet paint a clear picture highlighting this as fact.”

In reality, the menthol ban had a far smaller impact than many in the vaping industry had hoped, with traditional tobacco products finding fast workarounds that circumnavigated the new laws and allowed people to still access mentholated cigarettes, using items like Rizla flavour cards. Most recently, the disposables trend has drawn more people to vaping than the menthol ban ever did.

As of the most recently available data (E-cig Intelligence, Dec 2021, Kantar) shows us there is a particularly even split in sales between specialists and traditional retail. With a 35% share each to both channels and a remaining 30% attributed to online sales.

It is worth noting, however, that despite there being an even split, the value of these sales is higher in traditional retail; approximately £414m vs vape stores £395m. However, online sales have seen a steady increase in both market share and value sales as we moved into 2022.

“They are maintaining listings of core ranges but have also capitalised on the continued success of disposables,” adds Carr. “This will continue, and with our insight data, this should demonstrate the requirement to continue to focus on 10ml as this is still driving the volume sales in the category, with EDGE products standing out in terms of performance amongst the top brands in-category. Recognition needs to go to consumer trends, as opposed to what sells in depot. Wholesalers must consider: what does the consumer really want from the category and are we matching this?”

Paul Shakespeare, portfolio brand manager at JTI UK, comments: “Now more than ever, existing adult smokers and vapers are looking for convenient, discreet products that can be used when smoking or vaping might not be possible – making them a must-stock for retailers.”

Nordic Spirit, a range of 100% tobacco-free nicotine pouches, provides a convenient choice without producing smoke, vapour or odour. Nordic Spirit is available in varying strengths and flavours depending on individual customer preference – including Mint, Bergamot Wildberry and new for this year, Spearmint.

Nordic Spirit recently expanded its portfolio with the launch of a new flavour, Spearmint, and a new Extra-Strong nicotine strength for Bergamot Wildberry.

The new launches are both available in an Extra-Strong strength to reflect the growing demand for stronger variants in the nicotine pouch category.

With Strong and Extra-Strong now making up 72.6% of nicotine pouch sales (IRI), and Extra-Strong the fastest growing strength, the latest variants will help retailers provide a range of options for customers seeking a stronger nicotine experience.

The brand-new flavour from Nordic Spirit also offers retailers the first ever Spearmint flavour in the category in an Extra Strong nicotine strength. Mint flavours already account for 77.6% of the nicotine pouch category and now retailers can offer their customers a sweeter tasting alternative to the classic Mint variant.

Juul Labs has rolled out its next generation system, JUUL2, for sale across UK retail stores, the latest step in its mission to transition more adult smokers from combustible cigarettes, while combating underage use. The JUUL2 System has been updated from previous versions with new technology and features for adult smokers, including the capability to combat potentially harmful counterfeit and compatible pods.

Following a successful pilot launch on the Juul.co.uk website last autumn, JUUL2 will be available for adult smokers to purchase from a range of major retail outlets across the country this month.

The JUUL2 features, which are based on feedback from adult smokers, include a more consistent vapour experience that competes with combustible cigarettes.

It has a newly designed JUUL device with a larger, long-lasting battery, and smart light system, communicating e-liquid level and battery life.

Newly designed JUUL2 pods (18 mg/mL nicotine strength) are available in Virginia Tobacco, Polar Menthol, Crisp Menthol and new Autumn Tobacco, Ruby Menthol and Summer Menthol flavours.

It includes technology to prevent unauthorised use, such as the inclusion of JUULpod ID to further combat against counterfeit pods.

“Following a successful online pilot launch, we are pleased to release the next-generation JUUL2 for sale nationwide through our retail partners in the UK,” Juul Labs’ EMEA VP, Dan Thomson said. “We have been encouraged by the number of existing JUUL users who have transitioned to the new system since launching on our UK website, and we look forward to providing even more adult smokers with an alternative to combustible cigarettes.

“A key part of our mission is to transition adult smokers away from cigarettes, the leading cause of preventable death in the world, killing some 90,000 Britons annually. We believe the best method to switch adult smokers to a potentially less harmful, non-combustible alternative, is to provide a product that closely resembles the consistency and experience of smoking.

“It’s also critically important that alternatives can continue to compete with cigarettes, especially when it comes to the point of purchase, and with JUUL2, we believe we are taking another step in that direction.”

In addition to the upgraded features for adult smokers, JUUL2 also strengthens Juul Labs’ ability to protect against counterfeit products, striking a blow to the illicit trade market of its products. The JUULpod ID feature significantly improves the company’s ability to identify unauthenticated products and prevent use at the device level, and the JUUL2 Device will only work with JUUL2 pods.

All UK retailers stocking JUUL products will continue to uphold the company’s ‘Challenge 25’ age verification policy and are subject to continued mystery shopping audits. The company is also trialling a take-back and recycling programme for used pods and devices, which it hopes to roll out later this year.

“We have focussed our resources on the development of technologies aimed at transitioning smokers and combating unauthorised and underage use and we have a product roadmap in place to accomplish that for years into the future,” Thomson continued.

“As part of our goal to eliminate combustible cigarettes, we are committed to both responsible stewardship and environmental sustainability. We are committed to working collaboratively with key stakeholders to update the regulatory frameworks to ensure a responsible marketplace as the category evolves.”

Kate O’Dowd, Head of Commercial Planning at Philip Morris Limited (PML), comments: “When it comes to smoking, quitting is always the best option. But, for those adult smokers unable or unwilling to quit, convenience retailers should provide a smoke-free alternative to suit every need and preference.”

Vape, nicotine pouches, heat-not-burn products – the UK is maturing rapidly into a market of smoking alternative stores, offering a wider range of smoke-free categories rather than specialists focused on one category.

Heated tobacco is gaining significant traction in the UK amongst adult smokers looking for cigarette-like satisfaction , which currently, no other smoke-free category on the market can match.

Data from Nielsen found that heated tobacco represented 18.6 percent of the total Reduced-Risk Product (RRP) market in the UK in 2021 (Nielsen), growing 86 percent versus 2020. The data comes as increasing numbers of convenience retailers attempt to overcome conversion challenges by adding depth to their smoke-free offering.

Whilst over a quarter of adult smokers will explore smoke-free products in 2022, 58 percent haven’t yet found a satisfying alternative to cigarettes. Complementing vape and nicotine pouches with a real tobacco alternative will generate new revenue streams and enable retailers to offer a more rounded smoke-free portfolio to meet consumer needs.

IQOS – the UK’s number one heated tobacco product – has over 21 million users worldwide, with 7 in 10 having switched to IQOS and stopped smoking.

Having only launched in the UK in late 2016, awareness of heated tobacco remains low, but momentum is building. The number of stores selling HEETS has increased six-fold since January 2018. PML are now selling almost 50 times the volume of HEETS each month than it did on average in 2017.

With smoking rates continuing to decline, convenience retailers who embrace heated tobacco as part of a multicategory offering will ensure they can offer a better choice, both for their businesses and more critically, for the adult smokers they serve.

IQOS is the UK’s number one smoke-free product (Nielsen) and presents less risk to your health than continuing to smoke. Unlike a vape product, which uses liquid, IQOS is an electronic device that heats real tobacco for a more satisfying taste experience, which is why the majority of smokers who trial it, switch away from smoking for good.

HEETS Mauve is PML’s newest product launch: HEETS Mauve is a new variant in its range of HEETS tobacco sticks designed exclusively for the IQOS heated tobacco system. HEETS Mauve offers a crisp menthol tobacco blend with a taste of dark forest fruits.

 

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