TOBACCO: OVERVIEW United front underlines tobacco’s importance


Negotiating the tricky regulatory landscape is a challenge that duty free tobacco suppliers are used to, but novel approaches to merchandising and deepened customer understanding ensures the category remains a key cross-category footfall driver. Words: Luke Barras-Hill.


N


otwithstanding the obvious challenges, tobacco –like other categories in travel


retail – is equally pressured to deliver novel, engaging retail concepts and skus that compete effectively for space. This becomes increasingly


important in high-trafficked airport settings that demand maximum retail impact, particularly when in many cases tobacco display areas (TDAs) have rendered on-shelf cartons less visible. Through November and Japan Tobacco


December,


International (JTI) launched a limited edition Camel pack exclusively for Dubai International Airport and Dubai Duty Free. Challenged to come up with an


eye-catching solution to capture the interests of travellers through the world’s busiest international airport, JTI embossed Dubai Duty Free’s name on the packaging in a move to create exclusivity and theatre, while driving in-store basket spend. “We had great feedback from Dubai


Duty Free and excellent consumer feedback,” comments JTI Worldwide Duty Free’s (JTI WWDF) Corporate Affairs and Communications Director


Gemma Bateson. “Consumers are asking for product that has more sense of place – they’re in Dubai and want something different to take home.” “Dubai had come to us and asked


for something special. There are Camel consumers passing through here from all over the world, so this customer and locatation made perfect sense for us.”


Exclusivity ‘important’ Overall, 2017 was ‘a good year’ for JTI Worldwide Duty Free, according to Bateson. “I’m expecting a better one this


year, now that the logistical issues associated with packaging changes have settled,” she adds. Limited edition packs and


innovation remains important for JTI, with retailers searching for exclusivity, TRBusiness hears, which is particularly important owing to the highly pre-planned nature of the category. As such, retailers and suppliers


are compelled increasingly to think not only about the correct merchandise mix, but stay connected with adult tobacco smokers’ evolving preferences. “For the tobacco industry,


the changing nature of the ever- discerning adult consumer is just another consideration in ensuring the right portfolio is available,” comments a British American Tobacco (BAT) Global Travel Retail spokesperson. “With that, comes an emerging


trend of consideration – adult consumers still peruse the overall category, however the adult smokers consideration set has shifted to that of a ‘nicotine consumer’; browsing and purchasing from a cross-category selection. “With this in mind, those that


JTI launched a limited edition pack (LEP) for Dubai Duty Free last year


FEBRUARY 2018


successfully provide the right range of nicotine products will be more likely to succeed in this ever-changing


consumer landscape.” When it comes to brand loyalty,


Bateson agrees that tobacco remains as competitive as any other FMCG product. This is potentially affected, however, in what JTI refer to as ‘branding ban’ markets.


Regulation adaptations It is well established that often- onerous regulations remain part of the tobacco travel retailing landscape, but some regions have been hit harder than others in recent times. In Europe manufacturers have


had to conform to some dramatic changes since new rules contained within revisions to the EU Tobacco Products Directive became effective in May 2016. Following Australia’s move in 2012,


‘standardised packaging’ measures have also been implemented in countries such as Ireland, France and the UK, the latter of which requires cigarette brands to be sold in standard, non-branded dark green packaging under The Tobacco and


“The changing nature of the ever-discerning adult consumer is just another consideration in ensuring the right portfolio is available.”


British American Tobacco (BAT) Global Travel Retail spokesperson


TRBUSINESS 43


Above: Tobacco remains an essential cross- category footfall and basket driver in duty free.


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