Cigarettes in Mexico

PRE-COVID-19 PERFORMANCE

Mid-price segment gains some ground, while single-stick selling helps keep value sales growing

While still accounting for the least sales overall, mid-price brands gained a percentage point in volume share in 2019 due to increases in prices. Although smoking prevalence is marginally falling year-on-year, the number of people who smoke is nevertheless climbing owing to population growth.

Philip Morris still dominates though British American Tobacco gains ground thanks to consumer shift to mid-priced brands

The cigarettes category in Mexico is consolidated between international companies Philip Morris Productos y Servicios S de RL de CV and British American Tobacco México SA de CV. Japan Tobacco International Mexico S de RL de CV is also present in the country through the Camel and Winston brands, but has a much lower share.

Point-of-sale displays leveraged to raise brand-awareness

In 2019, no new regulations were imposed on cigarettes, although the sum of regulations in force to date include public smoking bans, mandatory graphic warning labels and advertising restrictions, all of which are having an impact on reducing smoking prevalence. The special tax added to cigarettes as a measure to discourage consumption has a limited effect, given the ease at which consumers can buy single sticks for a few pesos from numerous points of sale.

2020 AND BEYOND

COVID-19 impact

In 2020, sales of cigarettes are now expected to grow by 7% in constant 2019 value terms, in light of the impact of COVID-19. This compares with a 1% rise in sales forecast in Euromonitor International’s 2019 edition of tobacco.

Recovery and opportunities

Legal sales of cigarettes are predicted to return to a milder level of volume decline in 2021 as purchasing power recovers and the population and therefore number of smokers in the market continues to grow.

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