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The Saudi Arabia - Tobacco Market size is projected to increase by USD 1,671.2 million and the market size is estimated to grow at a CAGR of 3.4% between 2022 and 2027.
This Saudi Arabia tobacco market report extensively covers market segmentation by distribution channel (offline and online), product (combustible tobacco products and smokeless tobacco products), and product type (cigarettes, cigars, and smoking tobacco). Our report examines historic data from 2017 to 2021, besides analyzing the current market scenario.
Increasing number of organized retail outlets selling tobacco products is the key factor driving the growth of the market. Organized retail has grown globally with the establishment of new supermarkets, drug stores, convenience stores, hypermarkets, and specialty stores. In addition, the increasing number of organized retail outlets that sell tobacco products is also showing increased competition among market players. Tobacco companies are investing in branding and marketing actions to differentiate their products and gain a larger market share. Further, the increase in the number of organized retail outlets coupled with the rise in the sale of tobacco products will drive the growth of the Saudia Arabia tobacco market during the forecast period.
The Saudi Arabia Tobacco Market shows an accelerated CAGR during the forecast period.
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Growing e-commerce in Saudi Arabia is the primary trend shaping the growth of the market. With the growth of e-commerce businesses in Saudi Arabia, the market players have the potential to enhance their profitability. Online and e-commerce channels support business-to-business (B2B) as well as business-to-consumer (B2C) operations. Online shopping portals have also incorporated enhanced security features for efficient customer service and payments.
In addition, market players will be able to reduce their operating and overhead costs due to this business model. The number of online retail stores offering cigars, cigarillos, fine-cut tobacco products, and smokeless tobacco products has also grown significantly across the globe. Hence, the growth in the online retail business of tobacco products is expected to drive the growth of the market in focus during the forecast period.
The increasing popularity of substitutes is a challenge that affects the growth of the market. The Saudi Arabia - tobacco market is facing intense competition from substitute products such as e-cigarettes, heat-not-burn (HNB) products, vaping products, and other next-generation products (NGPs). Furthermore, nicotine replacement therapy products, such as lozenges, gums, nasal sprays, and inhalers, have emerged as suitable substitutes for tobacco products.
Furthermore, growing health consciousness among consumers and an increasing number of cancer cases caused by smoking tobacco products in Saudi Arabia have resulted in consumers seeking smoke-free and safer alternatives for tobacco products. The rising launches of NGPs have translated into declining customer interest in conventional tobacco products. Thus, these challenges are expected to impede the growth of the market during the forecast period.
Cigarettes form the major product in the combustible tobacco products segment, followed by traditional shisha (hookah), which has traditionally dominated the Saudi Arabia - tobacco market. Despite global trends towards lower cigarette consumption, these products remain popular. However, growing public knowledge of the health dangers connected with tobacco use has resulted in certain government attempts to reduce smoking, such as greater taxes and public education programs. Nevertheless, combustible tobacco products remain a popular choice, posing both challenges and opportunities for the tobacco business and Saudi public health efforts. Overall, the rising demand for combustible tobacco products is increasing the growth of the combustible tobacco products segment as well as the Saudi Arabia tobacco market during the forecast period.
The market share growth by the offline segment will be significant during the forecast period. The offline channels contain convenience stores, supermarkets, hypermarkets, tobacco specialty shops, and gas stations. In the offline segment, the majority of tobacco sales come from convenience stores and supermarkets, where cigarettes and other tobacco products are usually placed near the cash register to entice customers into making impulse purchases.
The offline segment was valued at USD 7,309.20 million in 2017 and continued to grow until 2021.
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Additionally, offline distribution channels provide tobacco companies with the opportunity to engage in direct marketing to consumers through in-store displays and promotions. Due to the large market share and sale of tobacco products from traditional offline retail outlets such as convenience stores, supermarkets, tobacco specialty shops, gas stations, and vending machines, the offline segment will contribute to the growth of the market in focus during the forecast period.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
The Saudi Arabia tobacco market report also includes detailed analyses of the competitive landscape of the market and information about 4 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The Saudi Arabia tobacco market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Saudi Arabia Tobacco Market Scope |
|
Report Coverage |
Details |
Page number |
118 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 3.4% |
Market growth 2023-2027 |
USD 1,671.2 million |
Market structure |
Concentrated |
YoY growth 2022-2023(%) |
2.9 |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Altria Group Inc., British American Tobacco Plc, Imperial Brands Plc, and Japan Tobacco Inc. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Distribution Channel
7 Market Segmentation by Product
8 Market Segmentation by Product Type
9 Customer Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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