Tobacco in Hong Kong, China
Euromonitor International's Tobacco in Hong Kong, China market report offers a comprehensive guide to the size and shape of the market at a national level. It provides the latest retail sales data, allowing you to identify the sectors driving growth. It identifies the leading companies, the leading brands and offers strategic analysis of key factors influencing the market - be they new product developments, packaging innovations, economic/lifestyle influences, distribution or pricing issues. Forecasts illustrate how the market is set to change.
Buy online to access strategic market analysis and an interactive statistical database of duty paid retail volume and value sales, illicit trade volume, company and brand shares, pricing, distribution and production data.
Tables: 40 | Publication date: Nov 2006
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Executive summary
Cigarette sales volume experiences a continuous decrease
Total market volume fell 5% in 2005 compared to 2004, continuing a decreasing trend since 2000. The wide availability of contraband on the island and ease of access to duty-free cigarettes were the primary factors for the fall in volume. Rising awareness of the health risks associated with smoking also contributed to the fall in volume, although the impact of this was less significant compared to the primary factors of contrabands and duty-free cigarettes. The 5% decrease in market value in 2005 was attributed mainly to the cigarette price war that saw the main players in Hong Kong make aggressive pricing tactics to capture more market share.
Proposal to ban public indoor smoking goes ahead
The government’s proposal to implement a total ban of smoking in public indoor venues by 2009 drew heavy criticism from the private sector, but was passed in October 2006. The law affects all indoor workplaces and public venues such as restaurants and even parks and beaches, which will have to ban smoking by January 2007. An exception to the law was made for venues such as bars, saunas, nightclubs and mahjong parlours, which have till 2009 to comply with the law. Public indoor venues such as mahjong saloons, karaoke bars and restaurants are popular haunts for smokers, and with the pessimistic outlook on the economy, forecasts for King Kong businesses are gloomy.
Price wars slammed by anti-smoking and medical bodies
In August 2005, Philip Morris reduced the retail prices of its premium flagship brands, including Marlboro, by up to 20%. Other leading manufacturers, including British American Tobacco Hong Kong, promptly followed suit, resulting in a cigarette price war. Although the main reason for the price cut cited was to arrest the decline in cigarette sales due to the increasing popularity of economy-priced cigarettes, anti-smoking and medical bodies criticised it as a move to draw more young people to start smoking as well as to increase smoking prevalence before the then-proposed ban of indoor smoking.
The price war is showing no signs of abating. Philip Morris announced another round of price cuts in April 2006 of up to 20%. Other manufacturers are expected to undertake similar measures.
Philip Morris continues to be the market leader despite losing ground
Even though it gradually lost small amounts of market share throughout the review period, Philip Morris Asia Ltd remained in pole position in the cigarette sector in 2005. The steady decline of its market share since 2000 probably prompted the price cuts to recover some lost ground. Its flagship Marlboro brand of cigarettes is still the most popular brand in Hong Kong, accounting for over a third of all cigarettes sold.
Cigarette sector expected to decline further as proposed smoking bans restrict smoking
With the impending blanket ban on smoking for the entire island of Hong Kong, smoking will become almost impossible. This is expected to have a large detrimental effect on volume sales of cigarettes, as smokers find it too inconvenient to light up. Moreover, the prevailing negative perception of smoking is expected to increase as public health awareness increases.
The government is also expected to impose more measures to curb smoking, policies which are in line with the FCTC (Framework Convention for Tobacco Control), including lowering tar levels, removal of supposedly misleading wording on cigarette packages such as “Light” or “Mild” etc. These will have further negative impact on the market volume and value.
Table of contents
TOBACCO IN HONG KONG, CHINA : MARKET INSIGHT
EXECUTIVE SUMMARY
Cigarette sales volume experiences a continuous decrease
Proposal to ban public indoor smoking goes ahead
Price wars slammed by anti-smoking and medical bodies
Philip Morris continues to be the market leader despite losing ground
Cigarette sector expected to decline further as proposed smoking bans restrict smoking
KEY TRENDS AND IMPACT ASSESSMENT
Smoking population
Death by cause
Legislation
Tar
Health warnings
Advertising & Sponsorship
Smoking in public places
Taxation and Duty Levies
Contraband (cigarettes)
Production/ imports/ exports
Table 1 Trade Statistics – Cigarettes
The Role and Effect of Cannabis/Marijuana
Cigarettes: Price Bands
Cigarettes: filter splits
Cigarettes: pack splits
MARKET INDICATORS
Table 2 Number of Smokers by Gender 2000-2005
Table 3 Deaths by Diseases of the Respiratory System 2000-2005
Table 4 Deaths from Heart Disease 2000-2005
Table 5 Deaths from Lung Cancer 2000-2005
Table 6 Contraband Cigarettes Penetration Estimate 2000-2005
Table 7 Retail Sales of Tobacco by Sector: Value 2000-2005
Table 8 Retail Sales of Tobacco by Sector: Volume 2000-2005
Table 9 Retail Sales of Tobacco by Sector: % Value Growth 2000-2005
Table 10 Retail Sales of Tobacco by Sector: % Volume Growth 2000-2005
Table 11 Retail Sales of Cigarettes by Distribution Format: % Analysis 2000/2005
Table 12 Forecast Retail Sales of Tobacco by Sector: Volume 2005-2010
Table 13 Forecast Retail Sales of Tobacco by Sector: Value 2005-2010
Table 14 Forecast Retail Sales of Tobacco by Sector: % Volume Growth 2005-2010
Table 15 Forecast Retail Sales of Tobacco by Sector: % Value Growth 2005-2010
DEFINITIONS
LOCAL COMPANY PROFILES - HONG KONG, CHINA
BRITISH AMERICAN TOBACCO CO (HONG KONG) LTD - TOBACCO - HONG KONG, CHINA
STRATEGIC DIRECTION
KEY FACTS
Summary 1 British American Tobacco Company (Hong Kong) Ltd: Key Facts
COMPANY BACKGROUND
PRODUCTION BY FACTORY
COMPETITIVE POSITIONING
JAPAN TOBACCO INTERNATIONAL (CHINA) LTD - TOBACCO - HONG KONG, CHINA
STRATEGIC DIRECTION
KEY FACTS
Summary 2 Japan Tobacco International (China) Ltd: Key Facts
COMPANY BACKGROUND
PRODUCTION BY FACTORY
COMPETITIVE POSITIONING
NANYANG BROS TOBACCO CO LTD - TOBACCO - HONG KONG, CHINA
STRATEGIC DIRECTION
KEY FACTS
Summary 3 Nanyang Brothers Tobacco Company Ltd: Key Facts
COMPANY BACKGROUND
PRODUCTION BY FACTORY
COMPETITIVE POSITIONING
PHILIP MORRIS ASIA LTD - TOBACCO - HONG KONG, CHINA
STRATEGIC DIRECTION
KEY FACTS
Summary 4 Philip Morris Asia Ltd: Key Facts
COMPANY BACKGROUND
PRODUCTION BY FACTORY
COMPETITIVE POSITIONING
CIGARETTES IN HONG KONG, CHINA
HEADLINES
Trends
COMPETITIVE LANDSCAPE
Prospects
SECTOR DATA
Table 16 Retail Sales of Cigarettes by Tar Level: Volume 2000-2005
Table 17 Retail Sales of Cigarettes by Tar Level: Value 2000-2005
Table 18 Retail Sales of Cigarettes by Tar Level: % Volume Growth 2000-2005
Table 19 Retail Sales of Cigarettes by Tar Level: % Value Growth 2000-2005
Table 20 Cigarettes Company Shares 2001-2005
Table 21 Cigarettes Brand Shares 2002-2005
Table 22 Forecast Retail Sales of Cigarettes by Tar Level: Volume 2005-2010
Table 23 Forecast Retail Sales of Cigarettes by Tar Level: Value 2005-2010
Table 24 Forecast Retail Sales of Cigarettes by Tar Level: % Volume Growth 2005-2010
Table 25 Forecast Retail Sales of Cigarettes by Tar Level: % Value Growth 2005-2010
Table 26 Retail Sales of Cigarettes by Price Band: %Volume Breakdown 2000-2005
Table 27 Forecast Retail Sales of Cigarettes by Price Band: %Volume Breakdown 2005-2010
Table 28 Retail Sales of Cigarettes by Standard/Menthol: %Volume Breakdown 2000-2005
Table 29 Forecast Retail Sales of Cigarettes by Standard/Menthol: %Volume Breakdown 2005-2010
Table 30 Retail Sales of Cigarettes by Tobacco Type: %Volume Breakdown 2000-2005
Table 31 Forecast Retail Sales of Cigarettes by Tobacco Type: %Volume Breakdown 2005-2010
Table 32 Retail Sales of Cigarettes by Filter Vs Non-filter 2000-2005
Table 33 Retail Sales of Filter Cigarettes by Carbon Vs Non-carbon 2000-2005
Table 34 Retail Sales of Cigarettes by Length 2000-2005
Table 35 Retail Sales of Cigarettes by Pack Size 2000-2005
Table 36 Retail Sales of Cigarettes by Pack Ttype 2000-2005
CIGARS IN HONG KONG, CHINA
HEADLINES
Trends
COMPETITIVE LANDSCAPE
Prospects
SMOKING TOBACCO IN HONG KONG, CHINA
OVERVIEW