E-Cig Volumes Dip Amid Public Debate on Flavors

NACS speaker reviews stats, shows how successful retailers grow category
Photograph: Shutterstock

ATLANTA — With much scrutiny over flavored e-cigarettes happening on both a federal and state level recently, a researcher at a tobacco educational session during this year’s NACS Show said his data reveals a “dip” in volume in recent weeks for vaping products, but overall, the category is still on the rise.

Also addressing characteristics of retailers who appear to be growing the tobacco category in controversial times, Don Burke, senior vice president of Management Science Associates (MSA), Pittsburgh, told about 250 attendees that despite slight declines period to period in recent weeks, vaping product volume movement is up from a year ago and “still growing.”

In recent weeks, federal health officials have raised concerns over the safety of e-cigarettes, while at least three states have taken executive action to ban certain vaping products.

He projected the bulk of the tobacco category—cigarettes—to fall in volume 5.5% to 6% for the year as opposed to a typical 3% to 5% (as the industry has seen in past years). However, Burke did forecast a more “normalized” decline in cigarette volume for 2020 at about 3.9%. He based that number on historic trends that encompass multiyear cycles.

Two other categories he said were growing were superpremium and deep-discount cigarettes. Economic factors are favoring the tobacco consumer, he said, encouraging premium buyers into the superpremium category; roll-your-own users are also trading up for premade deep-discount cigarettes.

Burke also revealed results of a study on a broad base of retailers that grew their category over recent months. Separating retailers in the study into two groups—high- and low-performing—he made several statements characteristic of high performers:

  • The number of tobacco items that high-performing retailers carried rose at a higher rate (10.5%) than that of low performers (2.2%).
  • The growth in the number of vaping items at high performers was higher (2.4% vs. 1.2%).
  • The number of deep-discount items grew slightly but significantly (0.8% vs. 0.5%).
  • Tobacco-free nicotine items or “modern oral” products grew by a greater percentage (49% vs. 36%).
  • A greater percent of high-performing retailers had secondary vape brands (17% vs. 11%).

Burke also highlighted other MSA studies about the effects of increasing excise taxes and banning flavors such as menthol had on retailers. Generally, he said while sales at affected stores decreased, stores in surrounding areas saw matching increases in sales. Essentially, consumers don’t stop using these products, as public health officials have hoped; Burke said they simply went elsewhere for what they wanted.

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