Smokeless Tobacco, E-Vapour Products and Heated Tobacco in the United Kingdom

2021 DEVELOPMENTS

Surge in demand for closed system single-use vapour products causes for concern for the wider industry

In the second half of 2021, closed system single-use vapour products exploded from its small base, with the full year seeing current value growth in the triple digits. Major brands in the category are Geek Bar and Elf Bar, which together account for more than a third of value sales.

Dominance of open system vaping questioned with continued rise in popularity of closed system products

Although specialist stores were able to reopen for much of 2021, open vaping systems did not perform in line with historical figures. Indeed, despite the greater availability of in-store advice – a feature which is highly necessary for sales of such products – the category was the worst performing in overall smokeless tobacco, e-vapour products and heated tobacco.

Distribution channels inexorably tied to open and closed system battle

With so many smokers quitting cigarettes during lockdown, the consequent success of both open and closed vaping systems has led retailers to dedicate more space to these products in-store. This will help maintain value growth in 2022 and beyond.

PROSPECTS AND OPPORTUNITIES

Perception of vaping improves, and government stands resolute in encouraging usage

Since the EVALI (e-cigarette or vaping use-associated lung injury) news of 2020, there has been continued concern over the relative safety of vaping. Although perceptions surrounding their harm shifted in 2021, the perception that they are more harmful than cigarettes remains high.

Bright but mercurial future for tobacco heating devices

Currently, the impact of tobacco heating devices remains negligible in the UK, with only a small minority of Britons having even heard of these products. However, many have tried vaping but return to smoking, as the experience did not emulate cigarette smoking closely enough.

Nicotine pouches to attract regulation

Although the government has no current plans to apply an excise duty to non-tobacco nicotine or e-vapour products, seeing them as an effective method of encouraging smokers to switch to less harmful alternatives, the situation may be different for nicotine pouches. The category has proliferated in popularity for a number of reasons.