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Country Report

Tobacco in the United Kingdom

| Pages: 61

Price: US$1,900

About this Report

EXECUTIVE SUMMARY

Declining volumes, but rising prices keep value sales rising

Overall value sales of tobacco increased above inflation, supported by rising prices and rising taxes, although volume sales remained static. Sales continued to be hit by the smoking ban and higher prices, as well as the ongoing economic uncertainty. The taxation situation continued to frustrate a number of manufacturers, as the government continued to apply its cigarette duty escalator, which was relaxed on alcohol. Volume sales remained trapped in the long term decline of recent years, as consumers had greater concerns about the health implications of smoking, and as the marketing and retailing of cigarettes became ever harder thanks to more stringent regulation. This included the introduction in 2013 of a ban on cigarette displays in large stores and supermarkets.

Economic uncertainty continues to boost cheaper brands

Consumers continued to trade down, switching to cheaper brands in the hope of saving money whilst economic uncertainty continued in the UK. The economic crisis led to a slight rise in unemployment and a very serious decline in living standards, with patterns of employment changing significantly, as well as cuts to welfare, all of which had serious effects on all levels of the economy, but particularly on demographics which are more likely to include smokers. Unsurprisingly, therefore, there was a move towards cheaper brands, especially with taxation taking the price of cigarettes ever higher. Consumers particularly moved from standard cigarettes, not only to economy brands, but also to RYO tobacco, whilst in cigars there continued to be a serious decline and a marked shift to cheaper cigarillos.

Supermarkets extends its lead thanks to pricing, range and convenience

Supermarkets was the leading distribution channel in cigarettes, cigars and smoking tobacco , and continued to gain share in each product area. This channel benefits from offering competitive prices, with consumers becoming increasingly willing to shop around for the best price as a result of higher taxation and on-going economic concerns due to the frequently high mark-ups in these channels. Supermarkets also offers convenience, enabling busy consumers to buy tobacco along with their groceries, whilst many outlets also offer a wide range of brands and products.

Imperial Tobacco Group continues to lead, with a mixed performance

Imperial Tobacco continued to be the strong leader in cigarettes at the end of the review period, and also led smoking tobacco, whilst ranking third in cigars. The company rebounded from a poor performance in cigarettes in the review period by gaining share in this category in 2012, thanks to price discounting and new product development, and its rivals’ stronger focus on price. Gallaher, meanwhile, ranked second in smoking tobacco and cigarettes in 2012 and led cigars; it gained share in each category. Gallaher succeeded thanks to its focus on price, with budget brand Sterling gaining share in cigarettes in 2012.

Continuing volume declines forecast, offset by higher taxes and prices

The long term trend of declining tobacco usage in the UK is likely to continue, whilst this in turn is likely to be offset by higher taxes and higher prices. The government seems intent on continuing the implementation of its duty escalator for tobacco, which essentially locks in price rises above inflation on an annual basis into the tobacco market. This in turn provides a windfall both for the government and for the tobacco market, as it disguises the declining volume figures. It is forecast that smokers will therefore continue to economise, which will continue to aid economy brands and RYO tobacco. There will also be a continuing fight over legislation, although plain packaging restrictions had been ruled out before 2015 at the time of writing.

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Overview

Discover the latest market trends and uncover sources of future market growth for the Tobacco industry in United Kingdom 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 United Kingdom, our research will save you time and money while empowering you to make informed, profitable decisions.

When you purchase this report, you also get the data and the content from these category reports in United Kingdom for free:

The Tobacco in United Kingdom 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 United Kingdom?
  • What are the major brands in United Kingdom?
  • Which sector of the tobacco products market is the largest by value sales in United Kingdom?
  • Which sector of the tobacco products market has been growing the fastest, by volume and value, in United Kingdom?
  • Which sector is the most heavily taxed in United Kingdom?
  • Which companies dominate in the total tobacco market in United Kingdom in terms of market share?
  • What is the distribution channel split for the tobacco products market in United Kingdom?

Why buy this report?

  • Gain competitive intelligence about market leaders
  • Track key industry trends, opportunities and threats
  • Inform your marketing, brand, strategy and market development, sales and supply functions

This industry report originates from Passport, our Tobacco market research database.

Table of Contents

Tobacco in the United Kingdom - Industry Overview

EXECUTIVE SUMMARY

Declining volumes, but rising prices keep value sales rising

Economic uncertainty continues to boost cheaper brands

Supermarkets extends its lead thanks to pricing, range and convenience

Imperial Tobacco Group continues to lead, with a mixed performance

Continuing volume declines forecast, offset by higher taxes and prices

OPERATING ENVIRONMENT

Legislation

  • Summary 1 Legislation Summary at a Glance

Country-specific legislation

Minimum legal smoking age

Smoking prevalence

Tar levels

Health warnings

Advertising and sponsorship

Point-of-sale display bans

Smoking in public places

Low ignition propensity (LIP) regulation

“Reduced harm”

Electronic cigarettes

Litigation

Death by cause

  • Table 1 Death by Cause 2008-2012

TAXATION AND PRICING

Duty paid packet marks

Taxation rates

  • Table 2 Taxation and Duty Levies 2007-2012

Average cigarette pack price breakdown

  • Table 3 Average Cigarette Pack Price Breakdown

PRODUCTION/IMPORTS/EXPORTS

  • Table 4 Trade Statistics – Tobacco Leaf 2007-2012

Illicit trade in cigarettes

MARKET INDICATORS

  • Table 5 Illicit Trade Estimate of Cigarettes: Volume 2007-2012

MARKET DATA

  • Table 6 Sales of Tobacco by Category: Volume 2007-2012
  • Table 7 Sales of Tobacco by Category: Value 2007-2012
  • Table 8 Sales of Tobacco by Category: % Volume Growth 2007-2012
  • Table 9 Sales of Tobacco by Category: % Value Growth 2007-2012
  • Table 10 Forecast Sales of Tobacco by Category: Volume 2012-2017
  • Table 11 Forecast Sales of Tobacco by Category: Value 2012-2017
  • Table 12 Forecast Sales of Tobacco by Category: % Volume Growth 2012-2017
  • Table 13 Forecast Sales of Tobacco by Category: % Value Growth 2012-2017

DEFINITIONS

SOURCES

  • Summary 2 Research Sources

Tobacco in the United Kingdom - Company Profiles

British American Tobacco UK Ltd in Tobacco (United Kingdom)

STRATEGIC DIRECTION

KEY FACTS

  • Summary 3 British American Tobacco UK Ltd: Key Facts

COMPANY BACKGROUND

PRODUCTION

COMPETITIVE POSITIONING

  • Summary 4 British American Tobacco UK Ltd: Competitive Position 2012

Gallaher Ltd in Tobacco (United Kingdom)

STRATEGIC DIRECTION

KEY FACTS

  • Summary 5 Gallaher Ltd: Key Facts

COMPANY BACKGROUND

PRODUCTION

COMPETITIVE POSITIONING

  • Summary 6 Gallaher Ltd: Competitive Position 2012

Imperial Tobacco Group Plc in Tobacco (United Kingdom)

STRATEGIC DIRECTION

KEY FACTS

  • Summary 7 Imperial Tobacco Group Plc: Key Facts
  • Summary 8 Imperial Tobacco Group Plc: Operational Indicators

COMPANY BACKGROUND

PRODUCTION

COMPETITIVE POSITIONING

  • Summary 9 Imperial Tobacco Group Plc: Competitive Position 2012

Cigarettes in the United Kingdom - Category Analysis

HEADLINES

TRENDS

COMPETITIVE LANDSCAPE

NEW PRODUCT DEVELOPMENTS

  • Summary 10 Cigarettes - New Product Launches

DISTRIBUTION

PROSPECTS

CATEGORY BACKGROUND

Cigarettes: price bands

  • Summary 11 Cigarette Price Band Definitions

Cigarettes: menthol/standard

Cigarettes: flavour threads and capsule filters

Cigarettes: filter/non-filter

Cigarettes: carbon/standard filter

Cigarettes: filter length

Cigarettes: regular vs. slims vs. superslims

Cigarettes: pack size

Cigarettes: pack type

CATEGORY DATA

  • Table 14 Sales of Cigarettes by Tar Level: Volume 2007-2012
  • Table 15 Sales of Cigarettes by Tar Level: Value 2007-2012
  • Table 16 Sales of Cigarettes by Tar Level: % Volume Growth 2007-2012
  • Table 17 Sales of Cigarettes by Tar Level: % Value Growth 2007-2012
  • Table 18 Sales of Cigarettes by Price Band: % Volume Breakdown 2007-2012
  • Table 19 Sales of Cigarettes by Standard/Menthol: % Volume Breakdown 2007-2012
  • Table 20 Sales of Cigarettes by Tobacco Type: % Volume Breakdown 2007-2012
  • Table 21 Sales of Cigarettes by Filter Vs Non-filter: % Volume Breakdown 2007-2012
  • Table 22 Sales of Filter Cigarettes by Carbon Vs Non-carbon: % Volume Breakdown 2007-2012
  • Table 23 Sales of Cigarettes by Length: % Volume Breakdown 2007-2012
  • Table 24 Sales of Cigarettes by Regular/Slim/Superslim: % Volume Breakdown 2007-2012
  • Table 25 Sales of Cigarettes by Pack Size: % Volume Breakdown 2007-2012
  • Table 26 Sales of Cigarettes by Pack Type: % Volume Breakdown 2007-2012
  • Table 27 NBO Company Shares of Cigarettes: % Volume 2008-2012
  • Table 28 Cigarettes Brand Shares 2009-2012
  • Table 29 Sales of Cigarettes by Distribution Format: % Analysis 2007-2012
  • Table 30 Cigarettes: Production, Imports and Exports: Total Volume 2007-2012
  • Table 31 Forecast Sales of Cigarettes by Tar Level: Volume 2012-2017
  • Table 32 Forecast Sales of Cigarettes by Tar Level: Value 2012-2017
  • Table 33 Forecast Sales of Cigarettes by Tar Level: % Volume Growth 2012-2017
  • Table 34 Forecast Sales of Cigarettes by Tar Level: % Value Growth 2012-2017
  • Table 35 Forecast Sales of Cigarettes by Price Band: % Volume Breakdown 2012-2017
  • Table 36 Forecast Sales of Cigarettes by Standard/Menthol: % Volume Breakdown 2012-2017
  • Table 37 Forecast Sales of Cigarettes by Tobacco Type: % Volume Breakdown 2012-2017
  • Table 38 Forecast Sales of Cigarettes by Filter Vs Non-filter: % Volume Breakdown 2012-2017
  • Table 39 Forecast Sales of Filter Cigarettes by Carbon Vs Non-carbon: % Volume Breakdown 2012-2017
  • Table 40 Forecast Sales of Cigarettes by Length: % Volume Breakdown 2012-2017
  • Table 41 Forecast Sales of Cigarettes by Regular/Slim/Superslim: % Volume Breakdown 2012-2017
  • Table 42 Forecast Sales of Cigarettes by Pack Size: % Volume Breakdown 2012-2017
  • Table 43 Forecast Sales of Cigarettes by Pack Type: % Volume Breakdown 2012-2017

Cigars in the United Kingdom - Category Analysis

HEADLINES

TRENDS

HAND-MADE VERSUS MACHINE MANUFACTURED SPLITS

COMPETITIVE LANDSCAPE

NEW PRODUCT DEVELOPMENTS

DISTRIBUTION

PROSPECTS

CATEGORY DATA

  • Table 44 Sales of Cigars by Category: Volume 2007-2012
  • Table 45 Sales of Cigars by Category: Value 2007-2012
  • Table 46 Sales of Cigars by Category: % Volume Growth 2007-2012
  • Table 47 Sales of Cigars by Category: % Value Growth 2007-2012
  • Table 48 Sales of Cigars by Handmade vs Machine-manufactured: % Volume Breakdown 2007-2012
  • Table 49 Sales of Cigars by Handmade vs Machine-manufactured: % Value Breakdown 2007-2012
  • Table 50 NBO Company Shares of Cigars Excluding Cigarillos: % Volume 2008-2012
  • Table 51 LBN Brand Shares of Cigars Excluding Cigarillos: % Volume 2009-2012
  • Table 52 NBO Company Shares of Cigarillos: % Volume 2008-2012
  • Table 53 LBN Brand Shares of Cigarillos: % Volume 2009-2012
  • Table 54 Distribution of Cigars by Format: % Volume 2007-2012
  • Table 55 Forecast Sales of Cigars by Category: Volume 2012-2017
  • Table 56 Forecast Sales of Cigars by Category: Value 2012-2017
  • Table 57 Forecast Sales of Cigars by Category: % Volume Growth 2012-2017
  • Table 58 Forecast Sales of Cigars by Category: % Value Growth 2012-2017

Smokeless Tobacco in the United Kingdom - Category Analysis

HEADLINES

DISTRIBUTION

COMPETITIVE LANDSCAPE

PROSPECTS

Smoking Tobacco in the United Kingdom - Category Analysis

HEADLINES

TRENDS

THE ROLE AND EFFECT OF CANNABIS/MARIJUANA

DISTRIBUTION

COMPETITIVE LANDSCAPE

NEW PRODUCT DEVELOPMENTS

PROSPECTS

CATEGORY DATA

  • Table 59 Sales of Smoking Tobacco by Category: Volume 2007-2012
  • Table 60 Sales of Smoking Tobacco by Category: Value 2007-2012
  • Table 61 Sales of Smoking Tobacco by Category: % Volume Growth 2007-2012
  • Table 62 Sales of Smoking Tobacco by Category: % Value Growth 2007-2012
  • Table 63 NBO Company Shares of RYO Tobacco: % Volume 2008-2012
  • Table 64 LBN Brand Shares of RYO Tobacco: % Volume 2009-2012
  • Table 65 NBO Company Shares of Pipe Tobacco: % Volume 2008-2012
  • Table 66 LBN Brand Shares of Pipe Tobacco: % Volume 2009-2012
  • Table 67 Distribution of Smoking Tobacco by Format: % Volume 2007-2012
  • Table 68 Forecast Sales of Smoking Tobacco by Category: Volume 2012-2017
  • Table 69 Forecast Sales of Smoking Tobacco by Category: Value 2012-2017
  • Table 70 Forecast Sales of Smoking Tobacco by Category: % Volume Growth 2012-2017
  • Table 71 Forecast Sales of Smoking Tobacco by Category: % Value Growth 2012-2017

Segmentation

This market research report includes the following:

  • Tobacco
    • Cigarettes
      • High Tar Cigarettes
      • Mid Tar Cigarettes
      • Low Tar Cigarettes
      • Ultra Low Tar Cigarettes
    • Cigars
      • Cigars Excluding Cigarillos
        • Large Cigars
        • Standard Cigars
        • Small Cigars
      • Cigarillos
    • Smoking Tobacco
      • RYO Tobacco
      • Pipe Tobacco
    • Smokeless Tobacco
      • Chewing Tobacco
        • Asian-Style Chewing Tobacco
        • US-Style Chewing Tobacco
        • Other Chewing Tobacco
      • Snuff
        • Moist Snuff
          • US-Style Moist Snuff ('Dip')
            • Loose US-Style Moist Snuff
            • Portion US-Style Moist Snuff
          • Swedish-Style Snus
            • Loose Swedish-Style Snus
            • Portion Swedish-Style Snus
          • Asian Style Creamy Snuff
        • Dry Snuff
        • Hard Snuff
    • Cigarettes Including RYO Stick Equivalent
      • High Tar Cigarettes
      • Mid Tar Cigarettes
      • Low Tar Cigarettes
      • Ultra Low Tar Cigarettes
      • RYO Cigarettes

Statistics Included

For each category and subcategory you will receive the following data in Excel format:

From Passport

  • Market Sizes
  • Company Shares
  • Brand Shares
  • Distribution
  • Pricing
  • Analysis by Type
  • Cigarettes by Blend
  • Cigarettes by Carbon Filter/Non-Carbon Filter
  • Cigarettes by Filtered/Unfiltered
  • Cigarettes by Length
  • Cigarettes by Pack Size
  • Cigarettes by Pack Type
  • Cigarettes by Price Band
  • Cigarettes by Regular/Slim/Superslim
  • Cigarettes by Standard/Menthol
  • Illicit Trade Penetration
  • Products by Ingredient
  • Smoking population - number of adult smokers
  • Smoking prevalence - % of adult population
  • Taxation
  • Trade Statistics - Volume

Market size details:

  • Retail volume
  • Retail volume % growth
  • Retail volume per capita
  • Retail value retail selling price % growth
  • Retail value retail selling price local currency, USD, EUR, GBP, CHF, JPY
  • Retail value retail selling price per capita local currency, USD, EUR, GBP, CHF, JPY
  • Illicit trade volume
  • Illicit trade volume % growth
  • Illicit trade volume per capita
  • Retail volume (sticks)
  • Retail volume (sticks) % growth
  • Retail volume (sticks) per capita
  • Retail plus illicit trade
  • Retail plus illicit trade % growth
  • Retail plus illicit trade per capita

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