Growth in retail volume sales of cigarettes in Azerbaijan in 2021 was up on 2020. This was partly explained by the ongoing societal fallout of COVID-19, with some people being inclined to smoke more while spending more time at home than usual due to public health restrictions, social distancing and remote working.
Despite the improved economic climate, many Azerbaijanis remained cautious in their discretionary spending decisions in 2021 after having seen their disposable incomes shrink since the start of the pandemic. Persistent uncertainty and rising inflation fuelled by the global recovery from COVID-19 also made consumers more budget-conscious.
The consumer base for cigarettes in Azerbaijan remained overwhelmingly male in 2021, as smoking prevalence among men is much higher than among women. Most female smokers are found in the capital city of Baku, where traditional social attitudes are less influential.
Retail volume sales of cigarettes are expected to decline steadily throughout the forecast period. The negative outlook is partly due to rising awareness of the health risks associated with smoking among the Azerbaijani population, which will continue to encourage existing smokers to cut down or quit and deter young people from taking up the habit to begin with.
Unit price increases ensuing from further excise duty hikes should ensure the cigarettes category expands in current value terms over the forecast period despite declining retail volume sales. However, current value growth is likely to be constrained by trading down to cheaper products as more consumers seek to reduce the cost of their smoking habit.
Increasing competition from alternative product types will also subdue retail demand for cigarettes over the forecast period. For example, it is expected the number of smokers choosing fine cut tobacco as a more economical alternative to cigarettes will increase.
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Cigarettes
RETAIL SALES OF DUTY PAID CIGARETTES The definition of cigarettes for the purposes of this study is duty-paid, machine manufactured white-stick products. This does not exclude brands of cigarettes that do not use white paper but it is designed to exclude the volume of non-machine manufactured products such as bidis/beedis (India) and papirosy (Russia), and other smoking products made with tobacco but that either do not resemble cigarettes as recognised in the US or Europe, or those that are not machine manufactured. The exclusion of these products is intended to give a more accurate picture of the "true" market for cigarettes and cigars which has been distorted in official statistics and published reports because of the inclusion of hybrid products. NB Please note that due to its central importance and integration into the industry mainstream, Indonesia’s market data does include hand-rolled kreteks DUTY-FREE sales are excluded from retail sales, as are herbal cigarettes. ILLICIT TRADE CIGARETTES Not included in retail sales, but split out separately in volume terms only. Defined as non-duty paid cigarettes (includes smuggled & counterfeit/fake products combined). Legitimate cross-border sales are considered duty-paid. Sales arising from a foreign national purchasing cheaper cigarettes in bulk in a neighbouring country for personal use and exported back are attributed to the country where the purchase is made (e.g. bulk cigarette sales by British nationals in France are attributed to France).
See All of Our DefinitionsThis report originates from Passport, our Cigarettes research and analysis database.
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