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Vaping market keeps growing

December 5, 2019

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The UK vaping market is worth £1.4bn (Ecigintelligence) and there are now 3.6m vapers in the UK, an increase of 12.5% on last year (Public Health England), a figure that is expected to continue to rise; which is no surprise when you consider the significant lifestyle and cost benefits compared to traditional tobacco.

However, currently only a minority of vape sales stem from traditional retail outlets, suggesting a real growth opportunity for retailers prepared to invest in upskilling their staff and educating them on the category.

With a dizzying number of different devices and liquids available, many shoppers may be understandably intimidated by the sheer breadth of the vape offering. These consumers need knowledgeable advice on what to buy and reassurances on product quality so it’s vital that staff understand what products they are selling, but also the end customers who they are selling to.

The ban on menthol from 20th May next year will leave many existing adult smokers without their product of choice.

“While some adult smokers may simply switch to other traditional tobacco alternatives, many menthol consumers may also use this as an opportunity to explore new ways to stick with their flavour preference and move into vaping,” comments Duncan Cunningham, UK Corporate Affairs Director at Imperial Tobacco & blu.

The menthol tobacco segment has a sizeable share of the market and with a third of adult smokers yet to even try vaping and almost 40% dualists still dabbling in tobacco (Action on Smoking and Health), retailers can play a crucial role in helping these consumers switch to vaping.

“While May next year seems a long time away, conversations around the forthcoming menthol ban should start happening now,” adds Cunningham. “Experience tells us that consumer awareness of tobacco legislation tends to be relatively low until it hits the shelves and they can’t buy product they want, so talking to consumers ahead of the ban is important.”

By engaging with customers early, retailers can help customers understand what is coming down the line and offer advice on what alternatives are available to them.

“It goes without saying that in order to prepare for this potential influx of ex-menthol cigarette smokers, retailers should ensure they have a strong range of menthol e-liquid flavours on offer, those including nicsalts like myblu Intense that will further help them switch,” Cunningham suggests.

“Regardless of the ban, the top-selling blu e-liquid flavour is menthol, so these variants are already very popular within the vaping category and worth getting right.”

A growing number of dedicated vapers and dualists are increasingly seeking out simple solutions amongst the array of different devices now on offer, including pod mod systems. Pod mods offer vapers and smokers a much simpler format to use and an easier experience in the transition

from smoking to vaping, so blu strongly recommends offering devices like myblu to tap into this trend. myblu delivers an enhanced vaping experience that is easy-to-use. The device combines a high-performance vaporiser, with just 20 minutes charge time, with hassle-free Liquidpods that allow consumers to switch between flavours in seconds via an easy one-step ‘click and go’ system. Its powerful and convenient design makes myblu appeal to existing vapers looking for a second device, vape/tobacco dualists and smokers looking to switch. Thanks to its vaping performance and its sleek, simplistic design, the myblu range has grown extensively in distribution and availability.

myblu’s Intense Liquidpods, featuring Nicotine Salts (nicsalts), have been devised by smokers for smokers. The inclusion of nicsalts allows myblu Intense to more closely replicate the experience of smoking a traditional cigarette, appealing to adult smokers looking to switch for the first time, or those who have tried vaping in the past and haven’t been completely convinced.

The latest market insights show that adult smokers need to experience different flavours in order to make the switch from tobacco to vaping a permanent lifestyle change.

Adult smokers also want and expect a nicotine delivery that is more like that of a traditional cigarette, something which blu’s Intense range looks to satisfy, thanks to the inclusion of nicsalts.

Launched in direct response to this growing demand, blu’s new Intense Starter Kit offers a range of flavours with a rapid nicotine delivery that will help adult smokers switch to something better.

Rolling out into stores now, the new myblu Intense Starter Kit includes the popular pod-mod vape device and USB charger, along with 2 x Intense Liquidpods, at an RRP of £19.99. The Intense Liquidpods within the kit include both Menthol and Golden Tobacco variants, two of blu’s best-selling e-liquid flavours (Action on Smoking and Health).

With e-liquids accounting for 34% of all vaping sales (EPOS 2018-2019 sales), another key trend worth mentioning with regards to vaping is flavours. The upcoming ban of menthol cigarettes in May 2020 presents a significant opportunity for retailers (and the vaping category) as consumers continue to seek out similar flavours from other alternatives.

“Retailers should stock up on menthol e-liquids and Liquidpods, especially those including nicsalts like myblu Intense, and be aware of the forthcoming changes to legislation, in order to be well positioned to help smokers switch to something better,” Cunningham suggests.

As well as seeking out the traditional menthol flavours, vapers are increasingly looking for unique combinations that blend different flavours together.

“Research shows that fruit-based flavours are increasingly preferred so in order to cater for this demand, we would recommend retailers stock a variety of different menthol-based flavours such as our classically cool Menthol variant and Blue Ice, which has hints of blueberry,” adds Cunningham.

“Retailers should also consider stocking other fruity blends like Eucalyptus Lemon, which combines sour lemon with the cool mint tones of especially eucalyptus, and Strawberry Mint which provides the perfect fruity-menthol fusion.”

Outside of menthol variants, research shows that fruit-based flavours are increasingly preferred and three of the five top-selling blu e-liquid flavours are fruit-based: No.1 menthol, No.2 blueberry, No.3 tobacco, No.4 strawberry mint and No.5 cherry (EPOS 2018-2019 sales).

“Training is the key to success,” Cunningham continues. “By taking the time to educate all staff on the category, including the latest trends, products and different terminology used, retailers can provide an exceptional level of service to customers that will encourage them to return to the store again and again.

“Within convenience stores, retailers can display, advertise and promote vaping products in and around the store. Eye-catching PoS and countertop display units can really help drive visibility and grab the attention of shoppers as soon as they walk through the door.”

Credible alternatives

“In the past the vaping category in independents has been dominated by e-liquids as retailers look to target current vapers,” comments John Patterson, Sales Director, JUUL Labs UK. “Vaping continues to grow but for every vaper there are two smokers with almost 60% of these smokers expressing a desire to quit smoking (ONS).”

Category growth will come from providing adult smokers with credible alternatives to cigarettes and helping them switch into a category which is widely acknowledged by Public Health England, NHS Scotland and The Royal College of Physicians as reduced risk compared to cigarettes. The past year has seen fantastic growth in vaping with a total market growth in excess of 30% with both the open and closed system sectors on the rise (IRI).

However over 80% of all growth is coming from closed pod systems such as JUUL, as adult smokers look for simpler, more convenient solutions (IRI).

The New Year is traditionally a time when smokers make resolutions to quit. According to Mintel, e-cigarettes are the most popular choice with over 80% using e-cigarettes to start their quitting journey.

“Retailers who offer a selection of vaping products post Christmas will be best placed to help adult smokers switch from combustible tobacco to smoking alternatives,” adds Patterson.

The upcoming ban on menthol tobacco and ‘click’ products (May 2020) will mean that the 20-25% of adult smokers who use these products in the UK and prefer menthol to tobacco flavour, will no longer be able to buy them.

“Clearly the ideal situation for such smokers would be to quit tobacco use entirely but, for those who choose to switch to alternatives in the e-cigarette and vaping category, they may be interested in some of the options and mint flavour products available there instead,” continues Patterson. “Like with previous legislation (tobacco display ban and standardised packaging) retailers should be planning for this now rather than leaving it to the last minute.”

With the same combined share as in the previous year at around 29%, independents and symbol retailers are still not getting their fair share of the vaping sector. In tobacco convenience accounts for 45% of sales while multiples account for 54% (Beige Analytics). In vape this is 26.8% and 62% respectively so multiples have been quicker to capitalise on the vaping opportunity (IRI).

However, with the market expected to continue to grow, there is still a huge opportunity for convenience retailers.

To increase sales, retailers should embrace the category, Patterson believes. “Do research on the various devices, your customers and what products they need,” he comments. “Seek advice from other retailers who are doing well within the category and also wholesalers and manufacturers.”

Stores should stock a comprehensive but focussed range, offering products across open, closed, heat not burn and disposables, Patterson recommends. “A focussed range with less duplication will free up space to carry a tighter range and you can increase the allocation for different nicotine strengths and accommodate a broader range of adult smokers looking to switch,” he suggests.

“Ensure that you are stocking the best-selling products in each sub-category and merchandise by brand giving multiple facings to the best sellers,” adds Patterson. “It is also critical that you do a regular range review based on sales data to make sure that you are maximizing your fixture’s potential.”

In vaping, over 90% of retailers are asked for advice by customers but over 40% of retailers are reluctant to respond as they are not familiar with the category (HIM). Updating yourself and staff on the various sectors and brands within vaping will help you to educate consumers and ensure they return to your store for future purchases. Use manufacturers’ point of sales material to highlight the category in-store and encourage smokers to switch, JUUL recommends.

Always remember that vaping is an age-restricted category and products can only be sold to adult smokers and existing vapers over the age of 18, JUUL advises. Ensure that you have an age verification process in place such as Challenge 25 and monitor any refusals. Also be mindful of how you engage on social media and be conscious of the age demographic of any followers and only use manufacturers’ point of sale as these have been legally approved. Finally only purchase product from legitimate sources and authorised wholesalers as this is your guarantee that products have been tested and approved for the UK market, is JUUL’s advice.