Navigating the world of electronic smoking devices can be a regulatory maze, but it’s worth it for Tobacco Retailers. Despite PMTA challenges, sales have continued to deliver, and category managers are seeing double-digit gains in vape sales. As the market evolves and new opportunities arise, the future looks bright for electronic smoking devices.
Tobacco retailers have had to navigate a vexing regulatory environment in recent years when it comes to the sale of electronic smoking devices. However, despite the challenges faced in obtaining pre-market tobacco applications (PMTAs) from the Food and Drug Administration (FDA), sales have been delivering for c-stores. As of September 2021, the FDA had received 8.9 million PMTAs, most of which were for e-cigarettes, vape products, and e-liquids. While the agency has made decisions on 96% of these submissions, an estimated 329,000 are still under review, and decisions are expected later this year. One of the biggest decisions the agency will make is whether to reassess JUUL products after initially denying the one-time category leader future retail sales.
While all this has been unfolding, Vuse, by R.J. Reynolds Vapor Co., has moved into the top position and remains there today. According to NielsenIQ data, the brand accounted for 36.6% of market share for the 52 weeks ending Jan. 28, 2023. However, in late January, the FDA issued marketing denial orders for Vuse Vibe Tank Menthol 3.0% and Vuse Ciro Cartridge Menthol 1.5%, requiring c-stores to immediately remove those specific items from their shelves. This also confirmed the FDA’s intent to ban menthol tobacco/nicotine products.
Despite all the happenings on the regulatory front, electronic smoking devices have delivered an acceptable performance in 2022. IRI, a Chicago-based market research firm, reports dollar sales for the 52-week period ending Jan. 1, 2023, at 9.3%, although the price per unit has increased by 14%. These developments have led category managers to contemplate revisions to their planograms, with vape sales at Twice Daily and Sudden Service c-stores finishing the year with double-digit gains. Tri Star Energy’s Merchandising Manager Rick Staley is expanding on disposable e-cigarettes, nicotine pouches, and new non-tobacco products that seem to be hot now and moving JUUL higher on the rack.
As category managers explore new opportunities and adjust their planograms, they can expect to see continued growth in the vapor category.
Eric Pewterbaugh, category manager for RaceTrac, which operates 558 stores throughout the South, sees better visibility for vape products as a way to reinforce cross-category engagement among tobacco/nicotine consumers. Pewterbaugh believes that inflation will drive smokers to consider vape options, and that the data shows a trend towards transition away from combustibles to other tobacco products. Despite regulatory challenges, Pewterbaugh sees the vapor category as here to stay and expects continued growth in the category.
In conclusion, the regulatory landscape for electronic smoking devices may be uncertain, but tobacco retailers can still benefit from offering these products to their customers. As category managers explore new opportunities and adjust their planograms, they can expect to see continued growth in the vapor category.
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