World tobacco control continues to advance, and cigarette sales in emerging markets have increased slightly, but cigarette sales in mature global markets continue to decline. At the same time, new tobacco products have grown rapidly and market competition has become more intense. Multinational tobacco companies have vigorously promoted product innovation, resulting in a large gap in operating performance .
According to Euromonitor International’s estimates, the number of consumers of new tobacco products exceeded 40 million in 2018, and it is expected to grow to 64 million by 2022, Asmodus Minikin which may replace about 4.6 million boxes of cigarettes;
In 2018, the sales of new tobacco products were USD 24.7 billion, a year-on-year increase of 45.8%. The scale is equivalent to the ninth-ranked cigarette market and close to the annual sales of shredded tobacco and cigars;
It is estimated that by 2020, Eleaf Istick new tobacco products will become the category second only to cigarettes in sales.
Among them, Vape is still the category with the largest sales. In 2018, Vape’s sales were approximately US$14.52 billion, an increase of 27% year-on-year, and the growth rate continued to slow Eleaf Istick Pico;
The second is the heated tobacco products represented by iQOS. Sales in 2018 were about 10.2 billion U.S. dollars, a year-on-year increase of about double, and the biggest contribution to sales growth.
Among the sub-categories, closed Vape has the fastest growth in sales, which is higher than heated tobacco products, mainly due to the changes in the Vape category structure in the US market.
Heating tobacco products
Looking at sales by region Dreamer Mod, Japan is still the largest market for heated tobacco products, with sales of approximately US$5.54 billion in 2018, a year-on-year increase of 8.5%, and the growth rate has gradually slowed down;
The second is South Korea, with sales of approximately US$2.12 billion in 2018, the fastest growth rate;
The third is Italy, with sales of approximately US$220 million in 2018, and recent growth has accelerated significantly.
In addition, the Russian market is growing faster than expected IJOY Avenger, and Romania, Greece, South Africa and other places are also major consumer markets.
The growth rate of the new market is fast, and the growth rate of the old market has slowed down:
The growth of the Japanese market has slowed down significantly. According to data from Philip Morris International, the growth rate of heated tobacco products has been significantly lower than expected since the first half of 2018, apv mod mainly due to the slowdown in consumer conversion speed. Consumers who have not yet converted are more conservative and difficult to convert Larger
The UK market is growing slowly. Although the official support for new tobacco products is relatively clear, heated tobacco products are expensive, and publicity and promotion are restricted, making development more difficult;
The Italian market has grown slowly. Although the country is one of the first regions where iQOS is listed, heated tobacco products have never shown an advantage in the competition with Vape. Even if Vape is hit by tax increases, Vape has achieved success in the country’s market. Higher growth rate;
The Korean market is growing rapidly. On the one hand, it has benefited from the environment similar to the Japanese market, and on the other hand, it is driven by the influx of a large number of products. In addition to several major multinational tobacco companies Ehpro Fusion TC Mod, South Korea’s KT&G has also launched new products one after another. Large-scale marketing has accelerated the market penetration of heated tobacco products.
Despite more abundant products and fiercer competition, iQOS is still in a leading position. Following Philip Morris International’s iQOS, British American Tobacco’s Glo, Japan Tobacco International’s Ploom Tech, Imperial Brands’ Pulze, South Korea’s KT&G’s Lil, etc. have all joined the market competition.
In order to seize the market, British American Tobacco’s Neocore was approved by the FDA for listing in the United States, but only as an equivalent product of Eclipse, not a harm reduction product. Eclipse was sold in the US for a year but ended in failure.
There are differences in pricing:
The price of cartridges is equivalent to mid-to-high-end cigarettes. For example, in the Japanese market in 2018 Vape Atomizers, heating rods for iQOS and Ploom Tech are 460 yen/pack (equivalent to high-end cigarettes), and heating rods for Glo are 420 yen/pack (equivalent to mid-range cigarettes) ).
The heaters are quite different, iQOS equipment is 10980 yen/set, Glo various equipment ranges from 4980 to 16,880 yen/set, and Ploom Tech equipment ranges from 3240 to 7980 yen/set. As the tax burden of heated tobacco products is significantly lower than that of cigarettes, the government loses high taxes. In 2018, while increasing the consumption tax on cigarettes, the Japanese government plans to increase the tax rate on heated tobacco products to about 80% of cigarettes in five years.
The first-stage tax increase was implemented in October 2018, and various companies increased their product prices accordingly. The iQOS heating rod increased by 40~500 yen/pack Aspire Breeze, the Glo heating rod increased by 40~460 yen/pack, and the Ploom Tech heating rod increased. 30~490 yen/pack, but in order to maintain competitiveness, the price increase is less than that of cigarettes.
Uncertainty in regulatory policies:
At present, Russia, Ukraine, Kazakhstan, etc. have issued product standards for heated tobacco products, and set minimum requirements for equipment quality and safety;
In the European Union, most countries require new product applications or market review to be submitted 6 months in advance. Philip Morris International filed a harm reduction product certification application for Heets heating rods in Italy, but was rejected due to insufficient evidence;
The British health department released a research report that pointed out that compared with traditional cigarettes, two new tobacco products such as iQOS used in the experiment can significantly reduce health hazards.
In addition, relevant departments such as Germany, the Netherlands, and South Korea have issued research reports with similar conclusions. New Zealand’s health department said that Vape can contribute to the 2025 smoke-free goal. The Wellington Court of New Zealand ruled to allow Philip Morris International to sell iQOS in the country.
The United States is the market with the highest Vape sales. In 2018, sales were US$5.6 billion, a year-on-year increase of 20.5%, followed by the UK market, with sales of US$2.43 billion, a year-on-year increase of 36.6%. Italy, Germany, France, etc. are all Vape consumption Big country.
The US Vape market has undergone major changes, and the closed Vape represented by Juul has risen. In the US Vape market in 2016, Renault USA’s Vuse (33.6%), Empire Brands’ Blu (23.6%), Japan Tobacco International’s Logic (14.5%), and Philip Morris America’s MarkTen (5.9%) were the main brands. According to Juul’s news YOOZ Vape Pod System, in 2018, juulVape’s market share in the United States surpassed Vuse to become the largest brand.
Juul is a closed Vape, compact and portable, similar to an extended U disk. When it was launched in 2015, it was in a period of rapid development of open Vape, and it did not actually belong to the mainstream Vape category. However, the biggest difference of Juul is that it has realized the taste of traditional cigarettes through the groundbreaking e-liquid formula and matching vaporizer system. Highly simulated, its tobacco raw material is liquid nicotine with nicotine salt as the core instead of free nicotine in traditional Vape, and organic acid is added to reduce the pH value of the flue gas, lower the vaporization temperature, IJOY Captain and make the flue gas inlet smoother and lighter Stinging throat sensation, while adopting airflow induction technology, it can be sucked without a switch, and it can be charged directly by plugging it into a computer. The rapid development of Juul illustrates the important role of innovation.
At present, new tobacco products are being updated rapidly. Focusing on the goal of optimizing the consumer experience, many products have richer flavors, easier use, more convenient carrying, stronger battery life, and faster charging. The rapid development of JuulVape has changed the pattern of product types. The proportion of open Vape, which was once the fastest growing, fell to 36% in 2018, down from 68% in 2014.
At present, nearly 40 countries and regions around the world have banned the sale of Vape, including Canada, Brazil, India, Japan, Argentina, Austria, Belgium, Thailand, Lebanon, Cambodia, Vietnam, Eleaf Vape Egypt, and Hong Kong. Some EU countries prohibit the sale of Vape online to prevent teenagers from using Vape.