Retailers are being urged to ready themselves for a potential spike in cigar sales this summer as the warm summer continues and the impact of the new European Tobacco Products Directive (EUTPD) and standardised packaging hits.
New research from JTI’s strategic insights team reveals that cigar sales increase by as much as 5.7% over the summer, potentially creating an additional £4.6m profit opportunity for retailers.
Sales are expected to peak in August, meaning retailers should make sure their cigar range is ready now, JTI said.
Last August sales of STG cigar products were up 6.6% on an average month.
“The reason is simply that the weather is nicer so people spend more time outside, where there’s no smoking ban,” Jens Christiansen, head of marketing and public affairs at STG UK, said.
Worth an estimated £234m, approximately one third of the overall UK cigar market is sold through the independent channel, according to JTI.
Cigars also have the potential to benefit from the new plain packaging legislation, from which they are exempt. As such they can still display branding and different colours.
“This will make them stand out on shelf, when the gantry is open, making them easier for consumers to see,” Christiansen added. “This also means it will be easier for retailers to find them, meaning less time will be spent serving each customer.”
Cigars are also exempt from the EUTPD minimum pack size regulations and can still be sold individually and in small 10 packs, meaning that in some cases certain cigar brands will become the cheapest options on the gantry.
This fact could attract existing smokers from other categories, according to STG.