Cigarettes continued to see both current value and retail volume declines in 2020, with increasing health concerns, heightened by the onset of COVID-19, leading to a decline in smoking prevalence. Although some smokers gave up smoking entirely, some consumers viewed e-vapour products and heated tobacco as less harmful alternatives and switched.
Another strongly relevant factor which has been affecting the category in recent years is rising prices. The government’s implementation of higher taxes on tobacco, including a further increase in the previous year, boosted revenues but contributed to the decline in consumption.
The COVID-19 pandemic has also led to shifts in distribution share in cigarettes in 2020. The lockdowns have led to restricted sales via certain channels.
The most relevant trends observed in 2020 are set to continue strongly impacting cigarettes over the next five years with health concerns and price sensitivity leading smokers away from cigarettes. The retail volume is expected to continue declining at a similar single-digit, but notable rate, for all years of the forecast period as consumers continue to transition to more affordable products, such as fine cut smoking tobacco, or less harmful ones, such as e-vapour products and heated tobacco.
Another major factor in the decline of cigarettes decline, is the increasing focus manufacturers are placing on alternative tobacco categories. Manufacturers are noting the declining interest in cigarettes and switching their focus to more profitable and popular categories.
With further tax increases likely to happen over the next five years, prices of cigarettes are expected to go up. It is unpredictable as to whether the taxation will increase from what was already planned as the government may use tax hikes to help the country recover from the COVID-19 crisis.
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Understand the latest market trends and future growth opportunities for the Cigarettes industry in Italy with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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This report originates from Passport, our Cigarettes research and analysis database.
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