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Tobacco: Cigarettes, RYO, E-Cigarettes & Lighters 2014

Where the Gains Are

C-store sales, 52 weeks ending Dec. 29, 2013

C-store sales of cigarettes fell 1.4%, with units off more than 2% in 2013, according to IRI. The biggest areas of growth in the category could be found in smokeless—unit sales rose nearly 4% for chewing tobacco and snuff, with spitless tobacco up almost 3%. Electronic smoking devices—IRI’s term for e-cigarettes—rose by triple-digit percentages on an expanding base, hitting more than $530 million in sales for 2013.

Roll-your-own (RYO) underperformed in 2013, with dollars off more than 15% and units down more than 16%. Pipe tobacco, however, enjoyed a more than 15% increase in unit sales, according to IRI.

CategoryC-store sales ($ millions)PCYAUnit sales (millions)PCYA
Cigarettes$51,643.7-1.4%8,546.7-2.1%
Chewing tobacco/snuff$5,004.17.7%1,214.93.8%
Spitless tobacco$181.43.9%52.42.8%
Total smokeless
tobacco
$5,185.47.6%1,267.33.8%
Cigars$2,352.6-2.7%1,509.22.0%
Electronic smoking
devices
$530.4176.5%49.2203.8%
Pipe tobacco$75.77.6%9.915.3%
Roll-your-own (RYO)
tobacco
$58.5-15.2%11.2-16.3%
Total all other
tobacco products
$134.2-3.6%21.0-3.9%
Lighters$538.62.8%368.50.1%
Smoking accessories
(pipes, etc.)
$249.6-2.4%158.7-5.1%

Source: IRI


Distributor Data: Cigarettes

Calendar year 2013

Shipments of cigarettes from McLane were off 4.5% in 2013, in dollar terms of average shipments per store per week, with all segments down from the previous year. E-cigarette shipments, meanwhile, rose by nearly 187%.

SegmentAvg. shipments per store per week (in dollars)Avg. shipments per store per week (dollar growth)PCYA
Premium$6,659.80-$328.01-4.7%
Generic$1,390.60

-$49.29

-3.4%
Subgeneric$140.87-$3.09-2.2%
Private label$25.14-$4.84-16.2%
Total$8,216.41-$385.24-4.5%
Electronic cigarettes$60.32$39.28186.7%

Source: McLane Co.


Distributor Data: Premium Cigarettes (C-Stores & Travel Plazas)

Calendar year 2013

The No. 1 premium cigarette UPC shipped by McLane in 2013 was the Marlboro Gold Box King. The Marlboro brand made up 60% of premium-cigarette cartons shipped by McLane.

Market Share by UPC 
Cigarette UPCShare of carton sales
Marlboro Gold Box King12.4%
Marlboro Red Box King7.3%
Newport Menthol Box King5.9%
Newport Menthol Box 1005.2%
Marlboro Special Blend Gold Box King4.0%
Marlboro Gold Box 1003.4%
Marlboro Special Blend Gold Box 1002.8%
Marlboro Red Box 1002.5%
Marlboro Silver Box King2.4%
Marlboro Special Blend Red Box King2.2%
Market Share by Brand 
BrandShare of carton sales
Marlboro60.0%
Newport14.4%
Camel12.9%
Winston3.5%
Kool2.0%
American Spirit1.9%
Parliament1.7%
Virginia Slims1.4%
Salem1.3%
Capri0.3%
Benson & Hedges0.3%
Other0.3%

Source: McLane Co.

Distributor Data: Branded Discount Cigarettes (C-Stores & Travel Plazas)

Calendar year 2013

The Pall Mall brand represented nearly 56% of branded discount cigarettes shipped by McLane in 2013, with the Pall Mall Red Box 100 the No. 1 UPC.

Market Share by UPC 
Cigarette UPCShare of carton sales
Pall Mall Red Box 10011.2%
Pall Mall Blue Box 1008.6%
Pall Mall Blue Box King6.0%
Pall Mall Red Box King5.9%
Pall Mall Menthol Box 1005.7%
Pall Mall Orange Box 1004.6%
L&M Box 1003.7%
L&M Box King3.7%
L&M Blue Box King3.0%
L&M Blue Box 1002.8%
Market Share by Brand 
BrandShare of carton sales
Pall Mall55.9%
L&M19.0%
Pyramid6.8%
Doral4.5%
Misty4.1%
USA3.0%
Liggett Select2.2%
Basic1.9%
Sonoma1.2%
Old Gold0.4%
Other1.0%

Source: McLane Co.


Distributor Data: Subgeneric Cigarettes

Calendar year 2013

McLane’s most shipped subgeneric cigarette UPC in 2013 was the Maverick Menthol Box 100; the Maverick brand commanded nearly 73% share of the segment’s carton sales from the distributor.

Market Share by UPC 
Cgarette UPCShare of carton sales
Maverick Menthol Box 10020.6%
Maverick Box 10016.9%
Maverick Gold Box 1009.9%
Maverick Box King7.6%
Maverick Menthol Box King5.7%
Maverick Gold Box King5.0%
Maverick Menthol Gold Box 1002.6%
Maverick Silver Box 1002.2%
Grand Prix Red Box 1002.1%
Maverick Menthol Silver Box 1001.9%
Market Share by Brand 
BrandShare of carton sales
Maverick72.5%
Grand Prix5.5%
Wave2.0%
Tahoe0.6%
Other19.4%

Source: McLane Co.

RYO Trends

Distributor Data: RYO

Calendar year 2013

McLane shipments of cigarette tobacco fell nearly 11% in 2013 in dollar terms, while pipe-tobacco shipments rose 7%.

SegmentAvg. shipments per store per week (in dollars)Avg. shipments per store per week (dollar growth)PCYA
Cigarette tobacco$8.63-$1.05-10.8%
Pipe tobacco$1.19$0.087.0%
Cigarette papers$6.82-$0.14-2.0%
Cigarette tubes$0.69$0.057.1%

Source: McLane Co.


Distributor Data: Pipe Tobacco

Calendar year 2013

McLane’s top pipe tobacco UPC in 2013 was the 0.75-ounce pouch of Largo Regular Pipe Tobacco.

1. Largo Regular Pipe Tobacco (0.75-oz pouch)

2. Red Cap Pipe Regular (0.75-oz. pouch)

3. Largo Mellow Pipe (0.75-oz. pouch)

4. Largo Mint Pipe (0.75-oz. pouch)

5. 4 Aces Pipe Tobacco (6-oz. bag)

Source: McLane Co.


RYO Tobacco by UPC: 20 Large Chains

C-store sales, 52 weeks ending Dec. 21, 2013

According to a Nielsen database of large c-store chains, the top-selling UPC in 2013 was the 0.65-ounce Bugler Original Tobacco Pouch, which was also the top cigarette-tobacco UPC shipped from McLane.

UPCC-store sales ($ millions)PCYAPound volume (millions)PCYA
Bugler Original
Tobacco Pouch
(0.65-oz.)
$4.0-15.6%1.0-19.4%
TOP Tobacco Pouch
(0.75-oz.)
$1.5-26.8%0.4-31.4%
TOP Superoll
(0.8-oz. double 0.4-oz.
pack)
$0.55.8%0.13.3%
Total (including UPCs
not shown)
$7.5-15.3%1.8-19.7%

Sources: The Nielsen Co., Swedish Match North America


Distributor Data: Cigarette Papers

Calendar year 2013

Zig-Zag French Orange was the No. 1 shipped cigarette-paper UPC from McLane in 2013.

1. Zig-Zag French Orange

2. Zig-Zag White

3. Joker Orange

4. Job Gold (1.5, 24-count)

5. TOP Gummed

Source: McLane Co.


Competitive Watch: Dollar General

While the c-store industry is paying keen attention to the dollar channel’s recent entry into the tobacco business, recent research by Management Science Associates suggests the level of competition is not heavy—yet. After examining two years of distributor shipment data, MSA determined that c-stores within a mile of a Dollar General store saw an initial hit in cigarette volumes of 5.8%; however, that decline narrowed to 3.8% on a sustained basis. The research suggests that grocery stores are actually the most vulnerable and giving up the greatest share to dollar stores relative to their overall share of cigarette volumes.

E-Cigarette Trends

C-store sales, 52 weeks ending Dec. 21, 2013

According to a Nielsen database of 20 large c-store chains representing about 13,000 locations, disposables enjoyed the strongest dollar and unit growth in 2013, although sales of rechargeables rose a

respectable 47%. The top three brands at these chains: blu, Logic and NJOY, according to Nielsen. IRI reports total c-store e-cigarette sales up by triple-digit percentages in 2013 to reach $530.4 million.

E-Cigarette Sales: 20 Large Chains

    
SegmentC-store sales ($ millions)PCYAUnit sales (millions)PCYA
Disposables$37.7163.6%4.7189.0%
Cartridge/rechargeable$24.147.0%7.144.2%
Starter kits$7.7122.1%0.47.1%
Total$69.6103.5%12.176.2%
E-Cigarette Brands: 20 Large Chains    
BrandC-store sales ($ millions)PCYAUnit sales (millions)PCYA
blu$23.9--3.0--
Logic$17.3148.7%3.2262.3%
NJOY$10.9244.0%1.4204.4%

Sources: The Nielsen Co., Swedish Match North America


Cross-Category Opportunity

E-cigarettes are not only the fastest-growing segment of the tobacco category, but they also show a great potential for building baskets. According to research by Management Science Associates that examined point-of-sale data at three midsized c-store chains, purchases that included e-cigarettes had the highest basket ring of all of the in-store categories, or $18.13 vs. an average of $6.99. While e-cigarettes contributed the bulk of that ring, 53% of e-cigarette market baskets included items from other categories. The most popular:

1. Premium cigarettes

2. Hot dispensed beverages

3. Foodservice bakery

4. Carbonated soft drinks

5. Foodservice sandwiches

6. Alternative packaged beverages

7. RTD iced tea

8. Discount cigarettes

9. Gum

10. Newspapers


Distributor Data: E-Cigarette UPCs

Calendar year 2013

Among the brands McLane carries, the top e-cigarette UPC shipped in 2013 was the blu Classic Tobacco disposable.

1. blu Classic Tobacco disposable

2. NJOY King Traditional Bold

3. blu Magnificent Menthol disposable

4. NJOY King Menthol Bold

5. NJOY King Traditional Gold

6. NJOY King Menthol Gold

7. blu Classic Tobacco Cartridge (5-count)

8. FIN Rich Tobacco

9. FIN Cool Menthol

10. blu Magnificent Menthol Cartridge (5-count)

Source: McLane Co.


Pocket-Lighter Brands

C-store sales, 52 weeks ending Dec. 29, 2013

Nearly 89% of c-store lighter sales in 2013 came from the BIC brand, according to IRI. Total c-store dollar sales of lighters rose nearly 3%, but units barely budged.

BrandC-store sales ($ millions)PCYAUnit sales (millions)PCYA
BIC$357.95.9%242.72.2%
BIC Limited Edition$76.07.4%44.43.4%
BIC Pro Series$15.0-0.4%8.1-2.5%
Flick My BIC$14.024.2%8.017.5%
The American Match$7.0-7.9%8.7-9.6%
BIC Collectors Series$6.5-14.2%3.5-17.1%
Playa del Rey
(no brand)
$6.5-0.9%6.45.4%
Private label$5.4-0.9%5.6-2.0%
Ace Products USA Inc. (no brand)$2.924.6%3.424.9%
Calico$2.9-19.7%3.3-19.8%
Total
(including brands not shown)
$538.62.8%368.50.1%

Source: IRI

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