The market share of R.J. Reynolds’ top-selling Vuse electronic cigarette continues to edge up, while Altria Group Inc. is struggling to gain traction with its NJoy acquisition.
However, the most pertinent news remains how the shadow of illicit e-cigarette sales continues to grow over the sector.
However, the overall e-cigarette volumes were down 13.9%, according to the latest Nielsen convenience store report released Tuesday that covers the four-week period ending Feb. 24.
The report largely covers the big chains. For smaller chains, the group extrapolates trends, which is why changes don’t appear immediately in the report.
Vuse’s market share rose from 42% to 42.2%, while No. 2 Juul was unchanged at 24.2%.
As recently as May 2019, Juul held a 74.6% share in the U.S. e-cigarette market. That’s when a series of regulatory actions contributed to product-reduction concessions and lower consumer demand.
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In June, Altria paid $2.75 billion in cash offer for full ownership of No. 3 U.S. e-cigarette NJoy. Altria cleared the way for the NJoy purchase in March 2023 by exiting its minority stake in No. 2 e-cigarette Juul while acquiring global licensing rights.
As of the latest Nielsen report, NJoy has a 3.2% market share.
Fontem Ventures’ blu eCigs, an affiliate of Imperial Brands Plc, declined from 1.2% to 1.1%.
Illicit sales draw focus
Both R.J. Reynolds Vapor Co. and Altria are prodding the Food and Drug Administration for heightened enforcement on “illicit” synthetic nicotine electronic cigarettes in the U.S. vaping market.
The companies separately have estimated those synthetic products represent about half of the overall domestic e-cigarette market.
“Consumers are moving to vaping products that Nielson doesn’t measure (and most of the market now being unapproved/illicit) and to nicotine pouches,” said David Sweanor, an adjunct law professor at the University of Ottawa and the author of several e-cigarette and health studies.
“The sales of Zyn continue to grow at a dramatic rate.” Zyn, sold by Philip Morris International subsidiary Swedish Match, is the top-selling U.S. oral nicotine product.
A letter from the U.S. House Select committee was sent Dec. 7 to the FDA and U.S. Justice Department to “draw attention to the extreme proliferation of illicit vaping products from the People’s Republic of China.”
The letter included eight questions to the agencies asking how they planned to handle the vaping products.
Among the most pertinent were: Does the FDA or Justice Department have plans to initiate further civil or criminal proceedings against violations by manufacturers? What steps is the FDA taking to more aggressively prevent the importation of illegal vapor products?
The U.S. House members urged the agencies to work with U.S. Customs and Border Protection officials “to address this urgent problem with all due speed.”
To that end, on Dec. 14, the agencies announced that about 1.4 million units of unauthorized e-cigarette products were seized during a cargo examination site at Los Angeles International Airport.
Among those was Elf Bar, which, according to the 2023 National Youth Tobacco Survey, is the most commonly-used brand among young e-cigarette users. The estimated retail value of the seized products totaled more than $18 million.
Traditional cigarettes
The Nielsen report is reflective of California banning menthol traditional cigarettes in December 2022, which represents about 8% of the national marketplace.
Philip Morris’ top market share was at 50.7% in the latest Nielsen report with top-selling Marlboro representing 45.8% of overall market share.
Meanwhile, Reynolds was at 32.9% with Newport at 12.7% and followed by Camel (7.7%), Natural American Tobacco (3.7%) and Pall Mall (3.7%).
ITG was at 8.5% overall, although ITG has said its market share is closer to 10%. Its No. 7 Winston brand remained at 2%, while Kool was No. 8 at 1.8% and Maverick at No. 9 at 1.7%.
Goldman Sachs analyst Bonnie Herzog said that “in terms of specific company trends, total nicotine sales declines eased for Juul, but accelerated for Altria, BAT and Imperial.”
The decline in traditional cigarette sales continues at a strong pace, Sweanor said
“The pace of transition from cigarettes to non-combustible products is extraordinary,” Sweanor said. “It is even more extraordinary in that it is happening despite extensive regulatory barriers and massive misinformation on relative risks.
“That raises the question of just how quickly the use of lethal cigarettes could be reduced if there was a serious effort to achieve rather than discourage that.”