The main impact of COVID-19 on cigarettes was related to the economic downturn felt in Costa Rica which encouraged higher rates of trading down amongst consumers in 2020. Indeed, while most users are habitual, the economic distress meant that the consumption that persisted was of a lower quality, representing a serious issue for an industry already struggling to generate revenue growth.
In 2020, multinational players continued their strategy of aligning their offerings on a regional basis. For instance, British American Tobacco Caribbean & Central America (BAT) continued to focus on its brand Pall Mall as it experienced rising popularity.
Brand consolidation continued to set the pace of main cigarettes players’ strategies in 2020. While BAT’s focus remained on Pall Mall, Tabacalera Costarricense SA opted to consolidate its efforts into mid-priced brand Chesterfield.
While cigarettes is expected to gradually strengthen its current value rate of growth from 2021 onwards, in volume terms, a decline will be felt throughout the entire forecast period. Indeed, cigarettes is already anticipated to remain affected by the overall economic impact derived from COVID-19 in the forecast period.
In the forecast period, cigarettes anticipates a further consolidation of a smaller base of global flagship brands. This strategy will be led by BAT’s Pall Mall and Tabacalera Costarricense SA’s Chesterfield.
At least in the short-term, a gradual contraction on the demand of premium cigarettes brands such as Marlboro is expected. The economic impact of the pandemic will continue encouraging consumers to search for the best value for their money.
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Understand the latest market trends and future growth opportunities for the Cigarettes industry in Costa Rica with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
If you're in the Cigarettes industry in Costa Rica, our research will help you to make informed, intelligent decisions; to recognise and profit from opportunity, or to offer resilience amidst market uncertainty.
This report originates from Passport, our Cigarettes research and analysis database.
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