LONDON -- World cigarette volumes experienced near-flat growth of .09% in 2010, while cigarette values increased 8%, according to research from Euromonitor International.
The strategy research firm reported that the values growth reflects pricing strength and a general growth in global flagship brands. Smokeless tobacco had the most value growth, 11%, with an increase in volume of 2.2%. Smoking tobacco followed, with 8.9% value growth and 3.7% volume growth. Cigarettes had 7.7% value growth and .1% volume growth.
"Product mix improvements are evident as are examples [image-nocss] of migrations to mid-price and economy brands, though the premium sector is still generally hanging tough," according to the research.
"Reduced harm" is moving center stage with the popularity of e-cigarettes, snus, dissolvables, tobacco sticks and nicotine replacement therapy, "possibly indicating a shift from the tobacco burning cigarette to the non-cigarette nicotine delivery mechanism."
Also according to the research, global illicit trade in cigarettes was about 555 billion sticks, up an estimated 6% compared with 2009 in the world (excluding China), largely due to rises in Eastern Europe.
The firm also outlined six trends for the tobacco industry in 2011:
1. Product innovation for pricing strength.
2. Improve international brand footprint.
3. Acquire state/private companies in developing markets.
4. Develop lower-risk products.
5. Adopt pragmatic pricing policies for leading brands.
6. Work with regulatory authorities.
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