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Strategy Briefing

Global Tobacco: Key Findings Part II: Vapour Products

75 pages, Oct 2017

US$1,325

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About This Report

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If you purchase a report that is updated in the next 60 days, we will send you the new edition and data extract FREE!

Growth in vapour products saw continuing deceleration in 2016, thanks to ongoing moderation in ‘”traditional” e-cigarette categories – such as cig-a-likes and open systems - balanced by the rapid emergence of heated tobacco, Regulation, innovation and – perhaps most of all –demographic and consumer behavioural shifts, will determine the future balance of consumption in the wider category.

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Overview

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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.

Vapour products value: USD12 bn

The total global vapour products market reached a value of USD12 billion in 2016. The US remained the largest market, but heated tobacco in Japan contributed most to growth in sales. Vapour products is rapidly eclipsing more well-established tobacco categories, and by 2020 will be the single largest category, outside cigarettes.

Vapour products value growth 2016: +34%

Growth of 34% globally in 2016 represented a continued deceleration of growth compared to the 43% experienced in 2015. This ongoing slowdown in growth is driven by moderation in the cig-a-likes and open systems categories; compensated by extraordinarily rapid growth in heated tobacco.

Non-cig-a-like closed system value: +252%

The highest rate of growth within vapour products in 2016 was recorded not by heated tobacco products, but by non-cig-a-like closed systems (AKA pod mods). Populated by a coterie of brands from tobacco companies and strong indies, the category offers consumers convenience and satisfaction.

Vaping population: 35 mn

An estimated 35 million people were regular dual or sole users of e-cigarettes and vapour products globally in 2015. While survey data vary by market, it is likely that a small majority of consumers remain dual users, although over time sole users will account for a greater proportion of the consumer base.

Open vaping systems value growth: +18%

The dominant open vaping systems category recorded the poorest growth within vapour products (excluding the all but redundant single-use cig-a-likes); a sign partly of category maturity, and partly due to regulation, consumer uncertainty and competition from other categories beginning to bite.

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Introduction

Scope

Background and Key Findings

Euromonitor International the first to estimate realistic market size

Research methodology

Tobacco and nicotine delivery timeline

Vapour products timeline

Headlines for 2016

Category size and growth comparisons 2011-2016

Vapour size and growth category outlook

Growth in vapour products set to slow, but remain significant

Price advantage of e-cigarettes versus cigarettes

Vapour products poised to overtake other tobacco product categories

Is vapour products hurting NRT?

User growth slows (before it takes off again?)

Geographic and Category Focus

Taxonomy of next generation products

Geographic spread of e-cigarettes

Growth in vapour products in 2016

Evolution of consumption: Liquid nicotine v heated tobacco

Cig-a-likes are yesterday’s products … almost everywhere

Non-cig-a-like closed systems offer a happy medium to users?

Open vaping systems dominant, but for how long?

Consumption set to shift back to closed vaping systems

Growth in heated tobacco thus far led by iQOS

Looking ahead in heated tobacco

US: Sales are strong but regulatory uncertainty pervades

UK: Official attitude begins to turn strongly positive

Italy: Strong demand for vapour products, but taxation impacts the market

Germany: Vapour products growing quickly

France: Tax and regulation could moderate growth

Japan: The proving ground for heated tobacco consumption

Channel Focus

Global distribution diversifies, but vape stores sees a growing share

The online channel: Vital , but problems lie ahead

Vape stores: Central to sales and identity

iQOS stores: Play a dual role in the early days of heated tobacco

Subscription model begins to stake a claim

Legislation

The quantum superposition of tobacco control

Differential regulation requires detaching nicotine from the mode of delivery

The shape of the end for combustion products dictates growth in vapour products

Global overview of e-cigarette regulation 2016

How will regulation for e-cigarettes and heated tobacco differ?

EU Tobacco Products Directive redefines vapour products in the EU

Some EU Member States decide to end online sales

FDA deeming regulations threaten to reshape the US market

What impact would e-cigarette taxation have?

Companies and Innovation

E-cigarettes landscape dominated by non-tobacco players

Tobacco players and their vapour brands

The changing face of innovation in next generation nicotine

New paradigms for innovation and development

World cig-a-like innovations: Top trends

World non-cig-a-like closed system innovations: Top trends

World vapourising device innovations: Top trends

Is tank system innovation consumer-focused?

World e-liquid innovations: Top trends

Heated tobacco innovation centres on safety and satisfaction

What Japan can tell us about the growth of heated tobacco elsewhere

Consumers and the Future

The future consumer is…

The future consumer is (also)…

Consumer megatrends are increasingly important

Key consumer megatrends pressing on new nicotine products

Tobacco industry needs to consider appeal to Generation Z

A significant generational shift provides issues to address

Generation Z practising what they preach

The meaning of new consumerism for next generation products

Legal marijuana emerging very rapidly as a global reality

Opportunities for tobacco companies in marijuana

Marijuana vaporisation grows in parallel

Other non-tobacco scope for expansion

We have long predicted these trends ….

…and they are now arriving

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Megatrends

Strategy Briefing

Global Tobacco: Key Findings Part II: Vapour Products

New Report Guarantee

About This Report

New Report Guarantee

Overview

Why buy this report?

Vapour products value: USD12 bn

Vapour products value growth 2016: +34%

Non-cig-a-like closed system value: +252%

Vaping population: 35 mn

Open vaping systems value growth: +18%

Want to find out more about this report?

Table of Contents

Introduction

Scope

Background and Key Findings

Euromonitor International the first to estimate realistic market size

Research methodology

Tobacco and nicotine delivery timeline

Vapour products timeline

Headlines for 2016

Category size and growth comparisons 2011-2016

Vapour size and growth category outlook

Growth in vapour products set to slow, but remain significant

Price advantage of e-cigarettes versus cigarettes

Vapour products poised to overtake other tobacco product categories

Is vapour products hurting NRT?

User growth slows (before it takes off again?)

Geographic and Category Focus

Taxonomy of next generation products

Geographic spread of e-cigarettes

Growth in vapour products in 2016

Evolution of consumption: Liquid nicotine v heated tobacco

Cig-a-likes are yesterday’s products … almost everywhere

Non-cig-a-like closed systems offer a happy medium to users?

Open vaping systems dominant, but for how long?

Consumption set to shift back to closed vaping systems

Growth in heated tobacco thus far led by iQOS

Looking ahead in heated tobacco

US: Sales are strong but regulatory uncertainty pervades

UK: Official attitude begins to turn strongly positive

Italy: Strong demand for vapour products, but taxation impacts the market

Germany: Vapour products growing quickly

France: Tax and regulation could moderate growth

Japan: The proving ground for heated tobacco consumption

Channel Focus

Global distribution diversifies, but vape stores sees a growing share

The online channel: Vital , but problems lie ahead

Vape stores: Central to sales and identity

iQOS stores: Play a dual role in the early days of heated tobacco

Subscription model begins to stake a claim

Legislation

The quantum superposition of tobacco control

Differential regulation requires detaching nicotine from the mode of delivery

The shape of the end for combustion products dictates growth in vapour products

Global overview of e-cigarette regulation 2016

How will regulation for e-cigarettes and heated tobacco differ?

EU Tobacco Products Directive redefines vapour products in the EU

Some EU Member States decide to end online sales

FDA deeming regulations threaten to reshape the US market

What impact would e-cigarette taxation have?

Companies and Innovation

E-cigarettes landscape dominated by non-tobacco players

Tobacco players and their vapour brands

The changing face of innovation in next generation nicotine

New paradigms for innovation and development

World cig-a-like innovations: Top trends

World non-cig-a-like closed system innovations: Top trends

World vapourising device innovations: Top trends

Is tank system innovation consumer-focused?

World e-liquid innovations: Top trends

Heated tobacco innovation centres on safety and satisfaction

What Japan can tell us about the growth of heated tobacco elsewhere

Consumers and the Future

The future consumer is…

The future consumer is (also)…

Consumer megatrends are increasingly important

Key consumer megatrends pressing on new nicotine products