Fashion models and mobile phone manufacturers have been obsessed with it for years, and now the trend towards the super-slim is rocking the tobacco accessories market, too.
As adult smokers continue to strive to make their money go further by smoking less tobacco, the demand for thinner and sleeker products is on the up.
As retailer David Worlsford explains: “These days it’s definitely a case of the slimmer the better when it comes to filter tips.”
Says David, who owns Farrants News in Cobham, Surrey: “Smokers are so price-conscious that they want to make smaller and smaller roll-ups, and these new slimline products allow them to do so.”
In just under 10 months a tobacco display ban will be implemented in small UK stores. Unlike Scotland where accessories such as rolling papers and filter tips are included under the legislation, small stores in England and Wales will still be able to display their accessories, but they will have to be positioned outside of the main tobacco unit.
Mascotte’s Sean Glyn thinks this could provide retailers with a distinct opportunity to showcase their accessories range - while also highlighting the fact that they still sell tobacco to adult smokers who may be in doubt once the shutters come down.
In a bid to help them do so, and raise its own profile in the process, Mascotte has created a new RYO accessories unit which is designed to sit at the customer side of the counter.
Matt Croft of Nisa Stocks Hill, near Silverstone, is planning to make much more of his accessories display once the shutters come down. “We will be relocating the accessories to a special unit in a much more prominent position at the side of the counter. Accessories can provide very healthy profit margins so making the most of them, while at the same time signposting the fact you still sell tobacco, can only be a good thing,” he says.
“Convenience stores should always have profitability in associated purchases at the forefront of their mind,” adds Imperial Tobacco head of independent retail Andrew Miller. “If a RYO smoker walks in with the intention of purchasing RYO tobacco and some papers, they may well leave having bought filter tips, a rolling machine and a lighter - it is vitally important for these to be displayed in a clearly visible area given their high profit margins.”
According to Mascotte GB UK, roll-your-own (RYO) smokers here roll the smallest sticks at just 2.4g on average compared with 4.1g in continental Europe.
Unsurprisingly, this demand for trim accessories is being reflected in new product development. Mascotte has created Extra Slim and Extra Long filters, which it says allow adult smokers to reduce tobacco usage by about 10%. Republic Technologies has also recently added a new Swan-branded Ultra Slim Filter with 126 filter tips and an rrp of 95p.
“The new filter is the thinnest Swan filter ever, providing RYO smokers with a smoother taste and an enhanced tobacco flavour,” says Republic Technologies UK marketing manager Eleni Koulara.
“Size of filter is becoming more important in the RYO sector, particularly among people looking to reduce smoking for health or cost reasons,” she adds.
The trend is also big news within the rolling papers market which, according to Imperial Tobacco, is now worth £100m in retail outlets.
Imperial Tobacco head of independent retail Andrew Miller says: “Year on year we have seen a continuation in the rise in the sales of King Size Rizla and thinner papers such as Rizla King Size Slim Blue and Rizla King Size Slim Silver.”
However, super-slim products are unlikely to be used in the first instance by RYO novices. New entrants to the RYO market tend to start with easier to roll, slightly thicker cut-corner papers, before migrating into the super-slim arena when they have become more adept at the process.
Sales of rolling papers are up year on year at David’s store. “This is in line with my RYO sales which are on the rise as adult smokers continue to downtrade into the segment from factory-made cigarettes,” he says. “These new RYO smokers tend to purchase easy-to-roll products such as Rizla Regular Green, which has cut corners. “However, Rizla King Size Slim Silver is also growing. You tend to find that the thinner the paper the more mature the smoker, and adult smokers migrate into the Silver category once they have become more experienced at rolling,” he adds.
When it comes to papers, the Rizla brand reigns supreme. Imperial Tobacco’s Rizla portfolio currently accounts for just shy of 90% of sales in the papers category, with products such as Rizla Regular Green accounting for 60% of the market.
As well as thinner papers, another trend worth noting is a move towards organic and less processed products such as unbleached rolling papers. These translucent, light brown papers have not had their fibres whitened by chlorine and offer smokers a more organic option.
Earlier this year Mascotte GB launched Mascotte Organic Extra Thin. Made from 100% hemp and organic fibres from certified plants, the new unbleached papers are proving popular with “caring rollies,” director Sean Glyn says.
Republic Technologies has also introduced unbleached rolling papers under the Zig Zag brand, backed by a major music promotion - The Unbleached Sessions. Made from 100% wood, the unrefined papers feature a watermark which assists in the rolling process. They are available in both Regular (rrp 27p for 50 papers) and King Size Slim (rrp 70p for 50 papers).
”My rolling paper sales have risen in line with the growing RYO market, and sales of RYO have grown since I decided to move RYO packs to the middle half of my gantry, where they are now much more visible. I sell only Rizla; I’ve tried other brands but people just ask for that. Golden Virginia and Amber Leaf are the two best-selling RYO brands, and the Amber Leaf 3 in 1 combi packs are a big seller as smokers will snap up anything that they feel offers them good value for money.”
Manny Patel, Manny’s, Long Ditton, Surrey
Zig Zag is sponsoring The Unbleached Sessions from May to September, in which six unsigned bands will get the chance to support The Cribs or Mystery Jets in a series of London music venues. Advertised on Spotify and in NME magazine, fans vote for which unsigned band should win the support-act gig.
Adult smokers’ desire to protect their pennies is also prompting a growth in the sale of ‘combi’ products, which combine all of the RYO smoker’s chief needs in one handy box or pouch. Imperial’s Miller elaborates: “Price continues to play an important role in the papers market as shoppers have become more price-conscious and are repeatedly looking for better value products,” he says. “Our ongoing consumer research shows that 62% of RYO tobacco shoppers prefer their tobacco to come with papers. This has led to an uplift in sales of our 8g GV Smooth Handy Packs and influenced our decision to include papers in packs of Golden Virginia Classic and GV Smooth.”
Golden Virginia Classic tobacco is now available in 12.5g, 25g and 50g packs with papers included in both the 25g and 50g packs; the 25g pack is the most popular with UK adult smokers.
While value for money is a key driver for purchases in many stores, for Matt Croft - who owns Croft’s Stores in the affluent village of Stocks Hill, near Silverstone - the success of combi packs is driven more by the added convenience that they offer rather than price. “The 8g Golden Virginia Handy Pack is a strong seller, as is the Amber Leaf Combi pack. For brand-loyal smokers these types of products are ideal as they are so convenient,” he says.
Some retailers such as David Worlsford are using the tobacco accessories market to create a real point of difference in their stores. David’s range of pipes and pipe accessories, including cleaners, knives, polish, grills, hedgehogs and even spills, brings people in from miles around and he currently sells about three pipes a week.
“I am renowned for my range so people come from far and wide to buy pipes from me, and I also have a handful of loyal local pipe smokers. The vast bulk of pipe sales tend to be briar models which are made from the root of the briar tree. A pipe doesn’t last for ever. If it isn’t cleaned properly it will eventually burn out and need replacing, but one of the most common reasons for people buying a new pipe is that male smokers tend to keep them in their back pockets and they accidentally sit on them and crack the stem!”
He adds: “Prices range from about £20 to hundreds of pounds. It depends what the smoker is after, but I tend to sell at least one £60 pipe a week. We also sell quite a few ‘rejects’ which are basically briar pipes whose wooden bowl contains a slight flaw such as a small pit or a knot in the wood of the bowl. You can’t actually see the flaw, but it’s in there and these pipes sell for much less.
“We also sell pipes called Meerschaum pipes, whose bowls are made out of hand-carved stone and change colour with age, and even some pipes called corn cobs which are made from corn cobs. These types of pipe originated during the American civil war when all the soldiers wanted to smoke, but there wasn’t enough briar wood to go round so the army made them from dried and hollowed-out corn cobs instead.
“Then there are the cheap clay pipes. We sell a few of these, but they tend to be used more for amateur dramatic plays or fancy dress parties.”
David says a typical pipe smoker is the older male, but they don’t fall into a particular financial demographic. “I sell pipes to old fishermen, lawyers and authors alike.”
Light up your life
“Lighters can be really good footfall drivers if you have the right range and merchandise them well,” points out Coventry retailer Arif Ahmed of Ahmed’s News. “Older smokers tend to buy the refillable lighters such as Clipper, which I sell for £1.10 with a 250ml bottle of gas for £1.89, but younger smokers tend to snap up a disposable product. For them it’s all about convenience and speed.”
Matt agrees. “Matches are a thing of the past when it comes to smokers. It’s all about lighters; they can be easily slipped in and out of the pocket and some of the disposable models offer excellent value for money and are particularly popular with younger smokers. One of my top-selling brands is Poppell, which I sell for 65p,” he says.
Another trend worth noting in the papers market is a move towards organic and less processed products such as unbleached rolling papers. These translucent light brown papers have not had their fibres whitened by chlorine and offer smokers a more organic option.
Earlier this year Mascotte GB launched Mascotte Organic Extra Thin. Made from 100% hemp and organic fibres from certified plants, the new unbleached papers are proving popular with “caring rollies,” Sean Glyn says.
Republic Technologies has also launched Zig Zag unbleached rolling papers, backed by a major music promotion - The Unbleached Sessions. Made from 100% wood, the unrefined papers feature a watermark which assists in the rolling process. They are available in both Regular (rrp 27p for 50 papers) and King Size Slim (rrp 70p for 50 papers).
Zig-Zag is sponsoring The Unbleached Sessions from May to September in which six unsigned bands will get the chance to support The Cribs or Mystery Jets in a series of London music venues. Advertised on Spotify and in NME magazine, fans vote for which unsigned band should win the support-act gig.
“Lighters are a huge market, and can be very profitable,” adds David. “A single disposable lighter will cost me about 20p to buy individually, but I sell it for £1.50.”
He goes on: “Bic lighters are very popular, as are Torjets of which I sell about 50 a month. The Torjet windproof lighter is refillable, but the rrp is so low that most smokers tend to chuck them out and buy a new one when they run out. Convenience tends to override price here.”
Interestingly, David says that lighter sales always spike in the summer. “I think it’s because smokers are spending more time outside, in the park or on the beach, and lighters simply get lost in the grass and sand. Last August, for example, my lighter sales almost doubled.”
David used to stock a wide range of pricier ‘under glass’ refillable products, but has cut this back in recent years.
“With the exception of Zippo and Pierre Cardin, so many of the ‘under glass’ refillable lighter brands suffer from bad durability and end up becoming faulty, which is of great frustration to shoppers and to me.
“Zippo rarely goes wrong, however, and it’s very popular with smokers in their late 20s and 30s, particularly when it brings out limited editions.
“I always aim to make a 50% margin on these products although I’m sure that Zippo would only recommend a 30% profit, but it’s got to be more than that to justify me selling them as I only tend to sell about 120 a year.”
The Zippo brand recently introduced a new range of products especially for convenience and forecourt consumers. The range features entry-level Zippo products suitable for impulse purchases, which are presented in easy-to-merchandise packs.
Zippo UK general manager Jon Sweeney comments: “By introducing a new range of lower-cost, entry-level products that are packaged efficiently for the convenience market, retailers are able to capitalise on consumers’ desire to buy into the brand’s offering in a far more impulse-led purchase.
“Our colleagues in North America have some excellent success stories showing real incremental sales for the sector, and we look forward to sharing this success with convenience customers here in the UK.”
The Zippo All in One Kit incorporates the brushed chrome Windproof Lighter, a tin of premium Zippo lighter fluid and a six- flint dispenser in one convenient pack for £19.60.
The Zippo Brushed Chrome Windproof Lighter is the UK’s best seller, selling three times more than any other Zippo lighter. Retailers who previously sold only lighter fluid typically get a 20% lift in lighter fluid sales once the lighter is added to the assortment.
Go your own way
The rise in fortunes of UK rolling paper and filter sales can be explained by the still booming RYO tobacco market. According to Amber Leaf manufacturer JTI, this market is now worth £2bn and growing at 9.2% year on year.
Virginia tobacco is named after the US state where it was first cultivated. It is also called ‘bright tobacco’ because of its yellow to orange colour, achieved during flue-curing. It grows particularly well in subtropical regions with light rainfall, such as Georgia (USA), southern Brazil and Zimbabwe. Classic English brands such as Benson & Hedges and Dunhill use mainly Virginia tobacco
Burley is a slightly lighter shade of green than Virginia. After being air-cured, the tobacco turns brown with virtually no sugars left in the leaf, giving it an almost cigar-like taste. It needs heavier soils and more fertiliser than Virginia. The best Burley is grown in the USA, Central America, Malawi and Uganda. Combined with Virginia and Oriental tobacco, it makes up an American Blend
Oriental is the smallest and hardiest type, grown in the hot summer of the Balkans, Turkey and the Middle East. It has an aromatic flavour, enhanced by sun-curing, as in a traditional Turkish cigarette.
RYO is now the biggest sector of the tobacco category by volume, and the second fastest growing price sector in the UK tobacco category, JTI head of communications Jeremy Blackburn says. He adds: “With almost one in three existing adult smokers choosing to smoke RYO tobacco, this growth is predicted to continue for the foreseeable future as existing adult smokers continue to seek out greater value for money.”
The sector is performing particularly well in UK independent and symbol stores, which account for “nearly half” of all RYO volume sales and are growing their share year on year,” Blackburn continues. “At the forefront of this growth is mid-price Amber Leaf, which has an 11% share of the total tobacco market, including cigarettes.”
One manufacturer looking to grab a bigger slice is BAT, as marketing manager Frank Silva explains. “The RYO category is utilised by two major smoker types - those who enter on price, the value hunters who are always on the lookout for the cheapest pack; and those looking for an authentic almost artisan, customisable smoking experience. These people place much more significance on how the tobacco smokes, tastes and makes them feel. They love RYO and want a more authentic way of smoking and we feel that there is an opportunity to give them that.”
Cue BAT’s significant investment in its Cutters Choice brand earlier this year. With branding under threat from new EU legislation which will see the size of health warnings increased to cover the majority of packs and plain packaging, BAT believes that tobacco taste could become the next big battleground. As such it has invested significant sums in the creation of a new ‘taste experience’ via its Cutters Choice brand.
The range was extended to offer three different blends: the Original Smooth blend; the True Blend, which is made from a modified Virginia blend without any artificial flavourings; and the Exquisite Blend, which offers adult RYO smokers a more mature and premium blend within the value for money segment.
Cutters Choice brand executive Claire Bodiguel says: “For a long time RYO tobacco was considered a lower-priced option for many adult smokers, but times are changing and adult consumers want high-quality products blended by masters.
“Cutters Choice is the first brand to do this in RYO and the different variants can be aligned to the mood of the consumer.”
The wider view
The trend towards value for money has certainly not been limited to the RYO and accessories sectors. When it comes to cigarettes, value and economy brands now account for more than 60% sales as adult smokers continue to trade down the price sectors.
Smaller 19-pack formats are helping manufacturers and retailers to offer lower ‘out of pocket’ prices, and 19s now account for almost 10% of sales of factory-made cigarettes.
Dennis Williams of Premier Broadway Convenience Store in Edinburgh says 19s are driving his cigarette sales. “Adult smokers know that they are getting one less cigarette, but they don’t care; it’s all about the price point these days and getting the best value for money. One of my top-selling 19-pack formats is Rothmans, which has just undergone a packaging refresh, while also launching a menthol variant.”
“The 19-pack format has a great price point for smokers, but the Rothmans brand in particular also offers me an 8% margin, which is brilliant as most of the other brands offer about 4 or 5%,” Dennis adds. “19s are definitely the way to go - for now.”
While they are selling well now, their success may be limited as 19s are to be banned from sale from the first half of 2016. Under the finalised Tobacco Products Directive, packs of less than 20 cigarettes and 30g of RYO tobacco will be banned. Capsule cigarettes and flavoured tobacco will also be banned from 2016, but a four-year phase-out period will apply to menthol cigarettes.
For now at least, it’s a question of making hay while the sun shines and JTI has extended its Benson & Hedges cigarette house with a new value-priced variant of the brand. Priced at £6.50 for 19 King Sized sticks, B&H Blue is designed to offer existing affordable quality.
Packs are considerably cheaper than the premium priced Benson & Hedges Gold brand, which retails for upwards of £8, and Dennis is excited about the prospects for this launch. “A well-known brand such as Benson & Hedges launching a value proposition is bound to makes waves. The pack design is also quite striking and they are offering retailers some very attractive margins at launch, which is always a good thing,” Dennis adds.
Available now, B&H Blue is also available in a Smooth flavour. To celebrate the launch, JTI is offering retailers a 10% POR and running a competition giving tobacco retailers the chance to win a range of prizes, including 2 Sony TVs, 15 iPad Airs and 30 Sony Clock Radios. Every retailer entering the competition will also receive a £5 money-off next purchase coupon for B&H Blue.
The move comes a couple of months after Imperial Tobacco extended its Lambert & Butler range with new L&B Blue in packs of King Size 19s cigarettes and in a smooth variant. L&B Blue has an rrp of £6.40.
Imperial Tobacco senior brand manager Alison Williams says L&B Blue is expected to appeal to smokers who had switched from Lambert & Butler in the past. “It will also appeal to long-time value smokers who previously haven’t been able to afford a product from the Lambert & Butler family,” she adds.
New lower price for Berkeley
JTI has reduced the cost price and rrp of its Berkeley King Size cigarettes and invested in a new look for the brand. Retaining the same Virginia blend tobacco, the updated King Size 19s, Blue 19s and 10s packs will now sit within the sub value segment, pricemarked at £6.25 and £3.25 respectively. The price and pack design of Berkeley Super Kings will remain unchanged.
STG unveils packs at super-low price
The Scandinavian Tobacco Group has unveiled a super-low value ‘little cigar’ that offers adult smokers an even cheaper alternative to value-priced cigarettes. Break Little Cigars feature an inbuilt filter with an Ecuador wrapper made of natural tobacco leaf. Sold in flip-top boxes of 17 with an rrp of £4.59, they offer the cheapest price per stick within both the cigar and cigarette categories. They offer margins of 10%.
Strike gold with Imperial Tobacco
Imperial Tobacco has launched Gold Leaf tobacco in a 9g pack. Complete with papers, Gold Leaf 9g enables adult smokers to make 22 hand-rolled cigarettes for less than £3. The low price point offers adult smokers a legal, viable cost alternative to illicit RYO, Imperial says. Sales of sub 12.5g pack sizes of RYO tobacco have more than doubled over the past year.
Republic Technologies has introduced Zig-Zag king-size rolling papers in vertical cases, taking up half the space of conventional packs. The packs are available for Blue King Size (rrp 65p, outers of 50); Silver King Size (rrp 75p, outers of 50); Blue King Size three-pack (rrp £1.49p, outers of 12) and Silver King Size three-pack (rrp 1.79p, outers of 12).
Fresh design for Old Holborn
JTI is hoping to create a buzz with the rollout of a fresh new design for its premium priced Old Holborn range this month. Available now, the new-look pack is available in 12.5g, 25g and 50g packs, which feature the new ‘Zip Fresh’ technology that is designed to help retain the tobacco’s moisture levels once opened. Old Holborn accounts for 2.3% volume share of the total RYO market, and has a 10.5% share of the premium price segment within this.