Cigarettes Market Analysis APAC, Europe, North America, Middle East and Africa, South America - US, China, Japan, Germany, UK - Size and Forecast 2023-2027

Cigarettes Market Forecast 2023-2027

The cigarettes market size is projected to increase by USD 141.91 billion and the market size is estimated to grow at a CAGR of 3.75% between 2022 and 2027. The increasing number of product launches, including new brands and variants, is driving consumer interest and expanding the product range available in the market. The growth in organized retailing, such as supermarkets and convenience stores, is increasing the availability and accessibility of cigarettes and tobacco products to consumers. The increasing number of smokers in APAC, driven by factors such as population growth and changing lifestyles, is contributing to market growth by expanding the consumer base for these products.

Cigarettes Market Overview

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Market Segmentation

This cigarette market report extensively covers market segmentation by type (flavored and non-flavored), distribution channel (offline and online), and geography (APAC, Europe, North America, The Middle East and Africa, and South America). It also includes an in-depth analysis of drivers, trends, and challenges. 

By Distribution Channel 

In the offline segment, The rising growth of the retail industry and the establishment of various retail outlets are the key factors driving the sales of cigarettes worldwide. Retailers offer consumers a wide range of products and the convenience of choosing them all under one roof. companies are also increasing their offline sales by efficiently manufacturing and selling their products and expanding their operations into remote locations to serve each category of consumers in large geographic areas, thereby increasing the sale of cigarettes. Thus, the number of offline distributional channels is increasing, which is expected to boost the growth of the market during the forecast period.

By Type 

The market share growth by the flavored segment will be significant during the forecast period. In addition to non-flavored cigarettes, market companies also offer fruit-flavored cigarettes, clove-flavored cigarettes, menthol-flavored cigarettes, herb-flavored cigarettes, and confectionery-flavored cigarettes. Flavors are mixed with tobacco or flavored capsules are placed in cigarette filters.

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The flavored segment was valued at USD 527.11 billion in 2017 and continued to grow until 2021. These flavored cigarettes are highly popular among millennials. These flavored cigarettes have enhanced the smoking experience of consumers. Additionally, menthol cigarettes are also consumed by children and adolescents, majorly in North American and European regions. The cigarette companies are endorsing their products through online promotion and advertisements, which are contributing toward the growth of the flavored segment in the global market during the forecast period.

By Region

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APAC is estimated to contribute 55% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The growing number of smokers in APAC is the key factor for the growth of the regional cigarette market. The region has approximately more than 30% of the overall smokers in the world and has always been the leading destination for all the global and multi-national market players in the tobacco sector. In APAC, the majority of cigarette consumers live in low- and middle-income nations such as Indonesia, Vietnam, Singapore, Malaysia, and India, among others.

Furthermore, the various governments in the APAC region have implemented strict regulations on tobacco products, including high taxes, restrictions on advertising and promotions, and mandatory health warnings on packaging. Such regulations led to a significant impact on the market for cigarettes in countries such as Singapore, China, and South Korea and have limited its growth. However, retail expansion and an increase in the number of organized retail outlets in the Asia-Pacific region, including India, Indonesia, and Malaysia, have made cigarettes readily available to consumers. This factor is expected to positively impact the growth of the market in the region during the forecast period.

Market Dynamics and Customer Landscape

The market is witnessing changes in consumer preferences, with a shift towards fruit-flavored, menthol-flavored, clove-flavored, and mint-flavored cigarettes. This trend is driven by changing lifestyles and a desire for continuous product innovation. Despite growing awareness of the harmful effects of smoking, these flavored cigarettes appeal to subgroups of smokers who seek different nicotine effects and mouth feels. The market is also influenced by the rise of e-commerce alongside traditional retail outlets like tobacco shops, supermarkets, hypermarkets, and convenience stores. Our researchers analyzed the data with 2022 as the base year, along with the key trends and challenges. A holistic analysis of drivers, trends, and challenges will help stakeholders in the value chain refine their marketing strategies to gain a competitive advantage.

Key Market Driver

Product innovations by players are the major drivers that have influenced the growth of the global cigarette market. Product innovations enable companies to outperform competitors and boost product sales, particularly in markets such as cigars, fruit-flavored cigarettes, and smokeless tobacco, where changing lifestyles and continuous product innovation are driving factors. For example, in November 2022, Philip Morris International Inc. unveiled an inexpensive heated tobacco product to expedite the transition to a smoke-free future. Likewise, in August 2021, Philip Morris International Co., Ltd. introduced IQOS ILUMA in Japan, the brand's initial tobacco heating system featuring induction heating technology, which eliminates the necessity for blades and cleaning. Consequently, these product introductions are anticipated to drive market growth during the forecast period.

Significant Market Trends 

Increasing demand for e-cigarettes is the key trend driving the market. E-cigarettes are electronic devices that stimulate the smoking experience. These operate by heating a liquid and creating an aerosol that the user inhales. The demand for e-cigarettes is currently high due to their wide penetration in various markets and is expected to increase during the forecast period due to new product launches.

Moreover, the cost-effectiveness of these e-cigarettes is one of the major factors contributing to the growth of the global tobacco market. Additionally, the market players are raising their investment in online promotions and e-cigarette advertisement or promotion campaigns to attract consumers of different age groups. Hence, these factors are driving the market during the forecast period.

Major Market Challenge 

High regulation of cigarette smoking is the major challenge to the growth of the market. The rise in various types of taxes such as excise, value-added tax (VAT), and tobacco tax in North America, APAC, and Europe is a major concern for market players as it negatively impacts margins and profitability. For example, certain state laws prohibit the sale of herbal tobacco to consumers under the age of 18 (19 in Alabama, Alaska, and Utah), and retailers can charge USD 300 to USD 1,000 for violating the law. 

Thus, many players, such as SMOKE-FREE, specifically require to confirm age verification before consumers visit their websites. Additionally, in April 2022, the US Food and Drug Administration (FDA) passed a rule banning menthol cigarettes and other flavored cigars to discourage youth adoption and significantly reduce tobacco-related illness and death. These regulations are expected to impede the growth of the market during the forecast period.

Cigarettes Market Companies Overview

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.

• Key Offering- British American Tobacco Plc:  The company offers cigarettes under brands such as Vuse, glo, and velo.
• Key Offering- Eastern Co. SAE:  The company offers Cleopatra white, Cleopatra queen soft, and Cleopatra super star.
• Key Offering- ITC Ltd.: The company offers cigarettes under brands such as India Kings, Classic, Gold Flake, American Club, Wills Navy Cut, Players, Scissors, Capstan, Berkeley, Bristol, Flake, Silk Cut, Duke, and Royal.

The market report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:

• Altria Group Inc.
• China Tobacco International HK Co. Ltd.
• Gold Leaf Tobacco Corp.
• Golden Tobacco Ltd.
• Gudang Garam Tbk
• Imperial Brands Plc
• Japan Tobacco Inc.
• KT and G Co. Ltd.
• Modi Enterprises
• Philip Morris International Inc.
• Poschl Tabak GmbH and Co KG
• PT Djarum
• Pyxus International Inc
• Scandinavian Tobacco Group AS
• Vietnam National Tobacco Corp.
• VST Industries Ltd

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.

Key Market Customer Landscape

The market research report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.

Global Market Customer Landscape

Segment Overview

The market report forecasts market growth by revenue at global, regional & country levels and provides a market growth analysis of the latest market trends and growth opportunities from 2017 to 2027. 

• Type Outlook 
  • Flavored
  • Non-flavored

• Distribution Channel Outlook
  • Offline
  • Online

• Region Outlook 
  • North America
    • The U.S.
    • Canada
  • Europe
    • The U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
  • South America
    • Chile 
    • Brazil
    • Argentina
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa

Market Analyst Overview

The market is dynamic, influenced by customer tastes and globalization. Major players offer a wide range of products, from premium wines to craft spirits. The market is driven by demand for upscale and artisan goods, with consumers increasingly seeking sustainable and organic products.

Wine regions like Greek Wine and Cave de Turckheim are known for their grape varietals and terroir, contributing to the cultural significance of wine. Champagnes and liqueurs also play a significant role, reflecting the craftsmanship and tradition of distillers. E-commerce channels have expanded the market's reach, allowing for online purchases and geographical penetration. However, the market faces challenges such as government regulations and economic factors. The market faces challenges from spirit categories like vodka and whiskey, as well as the wine and spirits trends.

The Cigarettes Market is influenced by various factors, including consumption patterns, customer tastes, and government spending on anti-smoking campaigns. Market estimates suggest steady growth, despite increasing social factors and threats to the industry. Key developments in cigarette manufacturing focus on product offerings and variation of occasions for consumption, aligning with changing customer preferences. The market's financial statements reflect this evolution, with companies adapting their production processes and industry footprint. Research and development growth in the industry is driven by the need to address health concerns and regulatory challenges. Primary research and secondary research play crucial roles in understanding market dynamics and predicting future trends. Company profiles of the top five companies highlight their regional footprint and strategies for growth. As the market evolves, subject-related expert advice is essential for navigating challenges and seizing opportunities.

The market is influenced by various factors, including customer tastes and preferences and the cultural significance of these beverages. Key players like Pernod Ricard and Brown-Forman have a significant industry footprint. The market sees a trend towards premiumization, with a focus on alcohol-free and low-alcohol alternatives. Factors such as vineyard locations and distillation processes play crucial roles. Understanding these dynamics is essential for companies to strategically position themselves in this dynamic market. Ace Matrix is a comprehensive analysis tool that evaluates various aspects of the alcoholic beverage sector. It delves into the company industry footprint and regional footprint of key players like Bodegas San Gines and Lar de Barros. Moreover, it examines the cultural significance of wine and spirits, exploring winemaking procedures and the fermentation process.

Factors contributing to market growth, including future trends and forecasted periods, are thoroughly analyzed using a strategic approach. Past and present analyses are conducted to provide insights into historical trends and current market dynamics. Additionally, political factors are considered to understand their impact on the position of companies within the market. The research methodology employed by Ace Matrix encompasses a detailed examination of product and/or service offerings, along with a comprehensive assessment of the worldwide beverage landscape. This approach allows for a thorough examination of wine and spirits market trends, aiding in future analysis and strategic decision-making processes.

Cigarettes Market Scope
Report Coverage	Details
Page number	149
Base year	2022
Historic period	2017-2021
Forecast period	2023-2027
Growth momentum & CAGR	Accelerate at a CAGR of 3.75%
Market growth 2023-2027	USD 141.91 billion
Market structure	Fragmented
YoY growth 2022-2023(%)	3.14
Regional analysis	APAC, Europe, North America, Middle East and Africa, and South America
Performing market contribution	APAC at 55%
Key countries	US, China, Japan, Germany, and UK
Competitive landscape	Leading companies, Market Positioning of companies, Competitive Strategies, and Industry Risks
Key companies profiled	Altria Group Inc., British American Tobacco Plc, China Tobacco International HK Co. Ltd., Eastern Co. SAE, Gold Leaf Tobacco Corp., Golden Tobacco Ltd., Gudang Garam Tbk, Imperial Brands Plc, ITC Ltd., Japan Tobacco Inc., KT and G Co. Ltd., Modi Enterprises, Philip Morris International Inc., Poschl Tabak GmbH and Co KG, PT Djarum, Pyxus International Inc, Scandinavian Tobacco Group AS, Vietnam National Tobacco Corp., and VST Industries Ltd
Market dynamics	Parent market analysis, Market forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and 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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What are the Key Data Covered in this Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the market growth and forecasting of the market between 2023 and 2027
• Precise estimation of the size of the market size and its contribution to the parent market
• Accurate predictions about upcoming market trends and analysis and changes in consumer behavior
• Growth of the market industry across Europe, North America, APAC, South America, and Middle East and Africa
• Thorough market growth analysis of the market’s competitive landscape and detailed information about companies
• Comprehensive market analysis and report on the factors that will challenge the market research and growth of market companies

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