Tobacco records mixed performance
In 2013, a 14% increase in excise duty boosted cigarettes current value sales but adversely affected volume growth. The government’s continued push of anti-smoking campaigns coupled with rising consumer health consciousness also contributed to the fall in cigarettes volume sales during 2013. On the other hand, cigars recorded positive volume and current value growth in 2013 as consumers traded up to this variant as a form of status symbol. Smoking tobacco also benefitted from targeting low income and rural consumers, who were seeking cheaper alternatives to cigarettes.
Ministry of Health implements series of new regulations from 2014
Besides the hike in excise duty during 2013, the Ministry of Health launched a series of new regulations starting from 1 January 2014 in a bid to deter consumers from smoking. Firstly, tar content was lowered from 18mg to 15mg while nicotine content was reduced from 1.5% to 1.3%. Secondly, pictorial graphic warnings were enlarged from 40% to 50% of the front of cigarette packs, with six new pictorial graphic warnings being included. Thirdly, the Ministry of Health specified its definition of public places to include the whole of an air-conditioned building, its five-foot perimeter and areas covered by the permanent roof linked to the main building. As these measures were to be implemented on 1 January 2014, their impact was yet to be seen at the time of writing.
British American Tobacco (Malaysia) leaves competitors behind
British American Tobacco (Malaysia) recorded the strongest increase in volume share to consolidate its leadership in cigarettes during 2013. Investments in product innovations and revamped packaging were key movements by the player in 2013. This also saw Dunhill significantly increasing its volume share during 2013 via two new launches. Other key cigarette players, including JT International Tobacco (Malaysia), also invested in revamping brand packaging to reinforce their positioning in the area.
Retailing of tobacco becomes more dynamic
Hotels/restaurants/bars, the leading distribution channel for cigarettes, lost ground in 2013 due to the ban in smoking in air-conditioned places. This in turn benefitted the performance of convenience stores and independent grocers as the wide distribution network of these channels eased consumer accessibility. 24/7 opening hours for convenience stores also attracted consumers as they can shop at any time at their convenience. On the other hand, tobacco specialists remained the leading distribution channel for cigars and smoking tobacco owing to their comprehensive product portfolio. Consumers, particularly new cigar smokers, were also reliant on advice and recommendations from tobacco specialists.
Tobacco to continue mixed movements
Tobacco is expected to continue recording a mixed performance over the forecast period. Cigarettes are projected to lose ground owing to the government’s continued push of anti-smoking campaigns and rising consumer health consciousness. On the other hand, more consumers will seek to trade up to cigars as a form of status symbol, especially with the projected improvement in economic conditions over the forecast period. Smoking tobacco will also sustain its positive performance in volume and constant value terms as products in this area remain a cheaper alternative to cigarettes for low income consumers.
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Discover the latest market trends and uncover sources of future market growth for the Tobacco industry in Malaysia with research from Euromonitor's team of in-country analysts.
Find hidden opportunities in the most current research data available, understand competitive threats with our detailed market analysis, and plan your corporate strategy with our expert qualitative analysis and growth projections.
If you're in the Tobacco industry in Malaysia, our research will save you time and money while empowering you to make informed, profitable decisions.
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The Tobacco in Malaysia market research report includes:
- Analysis of key supply-side and demand trends
- Detailed segmentation of international and local products
- Historic volumes and values, company and brand market shares
- Five year forecasts of market trends and market growth
- Production, imports by origin, exports by destination
- Robust and transparent market research methodology, conducted in-country
Our market research reports answer questions such as:
- What is the market size of Tobacco in Malaysia?
- What are the major brands in Malaysia?
- Which sector of the tobacco products market is the largest by value sales in Malaysia?
- Which sector of the tobacco products market has been growing the fastest, by volume and value, in Malaysia?
- Which sector is the most heavily taxed in Malaysia?
- Which companies dominate in the total tobacco market in Malaysia in terms of market share?
- What is the distribution channel split for the tobacco products market in Malaysia?
Why buy this report?
- Gain competitive intelligence about market leaders
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This industry report originates from Passport, our Tobacco market research database.