Smokeless Tobacco, E-Vapour Products and Heated Tobacco in Chile

2021 DEVELOPMENTS

E-vapour products benefits from positive health perceptions

E-vapour products ended 2021 with a strong positive performance in current value terms as Chileans became increasingly interested in the technology. Consumers wishing to give up smoking represent the main users of e-vapour products in Chile, although price represents a limiting factor in terms of its overall small size within tobacco, as many e-vapour products are considerably more expensive than cigarettes.

A growing category with few notable names

Despite multiple brands of e-vapour devices that are or have been imported in Chile throughout the years, including some well-recognised names such as JUUL (JUUL Labs Inc), the competitive landscape of e-vapour products remained notable for its lack of well-known brands apart from e-liquids brand LiQua Smoke Juice, locally distributed for Ritchy Group Ltd by Importadora Y Comercializadora Ggr Spa, which held double-digit value share in 2021. One of the key issues might be the lack of a distribution network, as it is not a widely developed market in the country.

Legislation for e-vapour products slowly moves forward in congress

The growing exposure of e-vapour products in Chile has been generating concern amongst official entities, which fear the development of an e-vaping culture within the younger underaged population, with the belief that this has the potential to act as an entry point to smoking traditional cigarettes. While e-vapour products has witnessed strong value growth for much of the review period, it has suffered somewhat from the impact of media reports on vaping-related deaths in the US.

PROSPECTS AND OPPORTUNITIES

Open vaping systems will remain growth driver of e-vapour products

As technology becomes increasingly accessible in terms of price as competition intensifies and new generations of devices gain access to the Chilean market, e-vapour products is expected to register further value growth (at constant 2021 prices) over the forecast period. Despite the possible development of legislation for these products, the lower perceived risk of e-vapour products amongst local consumers will continue to attract Chileans who either wish to quit smoking or are simply searching for an alternative to traditional tobacco products such as cigarettes.

Urban Chileans likely to remain target audience

According to a national health poll conducted by the Ministry of Health in Chile, the use of e-vapour products is more prominent in urban areas and among more educated consumers with higher disposable incomes. This is due to the high price of these products, but also because these consumers are more technologically savvy and follow global trends more closely.

Predicted entry of heated tobacco offers strong potential in Chile

Leading brands of heated tobacco products from traditional players were still missing from the category at the end of the review period in Chile. Neither Philip Morris nor British American Tobacco had ventured into the category with the launch of their reduced risk brands, IQOS and Vype, respectively, as they were waiting for more defined regulations regarding reduced risk and how these devices can be promoted to consumers.