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The heat-not-burn tobacco products market size is estimated to grow at a CAGR of 27.05% between 2022 and 2027. The size of the market is forecast to increase by USD 42,172.36 million. The growth of the market depends on several factors, including the cost-effectiveness of heat-not-burn tobacco products, heat-not-burn tobacco products that are relatively safer than conventional cigarettes, and the growing number of organized retailing outlets.
This report extensively covers market segmentation by product (devices, capsules, and vaporizers), distribution channel (offline and online, and geography (APAC, North America, Europe, Middle East, and Africa, and South America). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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The cost-effectiveness of heat-not-burn tobacco products is notably driving the heat-not-burn (HNB) tobacco products market growth, although factors such as the rising popularity of smokeless tobacco products may impede the market growth. Our researchers studied the data for years, with 2022 as the base year and 2023 as the estimated year, and presented the market's key drivers, trends, and challenges. Although there has been a decrease in demand for the market during the COVID-19 pandemic, a holistic analysis of drivers will help companies refine marketing strategies to gain a competitive advantage.
Key Heat-not-burn Tobacco Products Market Driver
The cost-effectiveness of heat-not-burn tobacco products is the key factor driving the global HNB tobacco products market growth. Over the past decade, the cost-effectiveness of heat-not-burn tobacco products has been the most important driver that is accelerating the demand for smoke-free products across different geographical regions.
Heat-not-burn tobacco devices and capsules are relatively more economical than conventional tobacco products, as many countries are raising the taxes on traditional cigarettes, which has led to a considerable increase in their prices. Therefore, heat-not-burn tobacco products have emerged as a cost-effective option for price-sensitive consumers, thereby increasing their adoption in the US. Heat-not-burn tobacco products have become a cost-effective option for Millennials and adolescent users, who, despite being the most frequent consumers of cigarettes, are the most price-sensitive demographic cohorts as well.
Key Heat-not-burn Tobacco Products Market Trends
The increasing promotional activities by vendors will fuel the global HNB tobacco products market growth. The players in the market are coming up with new marketing and advertising strategies to increase the sales of their products and highlight the various benefits of using heat-not-burn tobacco products. They are resorting to advertising campaigns that encourage people to limit the habit of smoking cigarettes that burn tobacco.
Philip Morris International markets its heat-not-burn tobacco products as 'designed to create a flavorful and satisfying nicotine-containing vapor, without burning and without smoke.' The company claims that this advertisement campaign targets consumers above the age of 35 years and features testimonials from smokers aged 37-54 years. Therefore, the initiatives taken by vendors to promote the consumption of tobacco products with minimal nicotine content are likely to increase the adoption of heat-not-burn tobacco products among smokers across the globe during the forecast period.
Key Heat-not-burn Tobacco Products Market Challenge
The rising popularity of smokeless tobacco products is a major challenge to the global HNB tobacco products market growth. The market is still relatively in the nascent stage when compared with the market for smokeless tobacco products like snus, chewing tobacco, moist snuff, and vaping products. Therefore, it becomes imperative for the key vendors in the market to sell their products with differentiating features and strengthen their customer base by implementing intensive strategies based on consumer engagement.
In the US and other North American countries, the major smokeless tobacco products that are highly popular among the masses include snus, moist snuff, and chewing tobacco; snus accounts for a major share of the smokeless tobacco market in the US. In India, the local variants of smokeless tobacco products include gutkha, khaini, and zarda, which are quite popular among the masses due to their comparative affordability, which poses a serious threat to the HNB tobacco products market during the forecast period.
Key Heat-not-burn Tobacco Products Market Customer Landscape
Our analysis of the life cycle of the market indicates a movement from the innovator’s stage to the laggard’s stage. Technavio has included key purchase criteria, adoption rates, adoption lifecycles, and drivers of price sensitivity to help companies evaluate and develop growth strategies from 2022 to 2027.
Global Heat-not-burn Tobacco Products Market Customer Landscape
Vendors 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
I Smoke Vapor - The company offers heat-not-burn tobacco products such as Lafayette vaping devices. Also, the company focuses on offering vaping devices and e-liquids.
We also have detailed analyses of the market’s competitive landscape and offer information on 20 market vendors, including :
Qualitative and quantitative analysis of vendors 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 vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth by the devices segment will be significant during the forecast period. In 2022, the devices segment was the largest product segment in the HNB tobacco products market. Over the same period, the global heat-not-burn tobacco devices market was highly concentrated due to the presence of a few regional as well as global vendors. Furthermore, heat-not-burn tobacco devices usually comprise starter kits that contain a charger, a device holder, and a heating unit.
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The devices segment showed a gradual increase in market share with USD 5,797.76 million in 2017 and continued to grow by 2021. Factors such as the increasing number of launches of heat-not-burn tobacco devices in different countries across the world and the relatively lower cost of heat-not-burn tobacco devices when compared to conventional cigarettes are projected to have a positive impact on the growth of the global heat-not-burn tobacco devices market during the forecast period. Furthermore, our report provides a brief analysis of the historical and forecast market share and their segments along with the reasons for growth from 2017 to 2027.
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APAC is projected to contribute 42% of market growth by 2027. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
In 2021, APAC was the largest regional market for heat-not-burn tobacco products. Over the same period, the heat-not-burn tobacco products market in APAC was highly concentrated due to the presence of a few regional and global vendors. The major markets in APAC with huge potential for heat-not-burn tobacco products include New Zealand, China, South Korea, the Philippines, and Japan.
This report forecasts the contribution of all the segments to the growth of the market. In addition, we have included the COVID-19 impact and the recovery strategies for each segment. The outbreak of COVID-19 led to a decline in demand for heat-not-burn tobacco products in APAC. As COVID-19 has a severe impact on the lungs of people diagnosed with the infection, especially smokers, several people across APAC were compelled to avoid the consumption of tobacco products in 2020. In addition, governments of countries, including India, China, and Japan, had to impose a lockdown in 2020 to curb the spread of the disease. This, in turn, resulted in a temporary shutdown of several end-user manufacturing industries, including the manufacturing plants for tobacco products, in 2020. However, the lifting of lockdown restrictions in 2021, due to the large-scale vaccination programs conducted across APAC, helped market vendors to resume manufacturing tobacco items to meet the needs of consumers in APAC. In addition, with the reopening of hotels, restaurants, bars, pubs, eateries, and discotheques, the demand for tobacco products among these end-users also increased significantly, driving the growth of the heat-not-burn tobacco products market in APAC further during the forecast period.
Our report forecasts revenue growth at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027. The market has been segmented by type, product, distribution channel, and region.
Heat-not-burn Tobacco Products Market Scope |
|
Report Coverage |
Details |
Page number |
151 |
Base year |
2022 |
Historical year |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 27.05% |
Market growth 2023-2027 |
USD 42,172.36 million |
Market structure |
Concentrated |
YoY growth (%) |
26.33 |
Regional analysis |
APAC, North America, Europe, the Middle East and Africa, and South America |
Performing market contribution |
APAC at 42% |
Key consumer countries |
US, Japan, China, Italy, and UK |
Competitive landscape |
Leading companies, Competitive Strategies, Consumer engagement scope |
Key companies profiled |
British American Tobacco Plc, Imperial Brands Plc, iSmoke Vapor Inc., Japan Tobacco Inc., JFT Co. Ltd., KT&G Corp., Mysmok Electronic Technology, Pax Labs Inc., Philip Morris International, SLANG Worldwide Inc., and Vapor Tobacco Manufacturing |
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, 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. |
We can help! Our analysts can customize this report to meet your requirements. Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Product
7 Market Segmentation by Distribution Channel
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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