EU
According to a report by Persistence Market Research (PMR), sales of cigars and cigarillos in Europe surpassed 9 billion units in 2015. This number is expected to reach around 11 billion by 2024.
Growth will be sluggish with PMR projecting a 2.1% CAGR in terms of volume through 2024. Availability of several affordable alternative tobacco products is negatively influencing demand for cigars and cigarillos. Efforts such as government mandates to include a statutory warning on tobacco packaging and youth outreach program are creating awareness among smokers. This, along with smoking cessation campaigns is expected to reduce the number of smokers, thereby influencing the market.
The market share of cigars and cigarillos with no-flavor/tobacco is anticipated to register a slight increase to reach 77% by 2024 from 76.7% in 2016. No-flavor/tobacco cigars and cigarillos would remain the most preferred in the market during the forecast period. In contrast, flavored cigars and cigarillos including fruit & candy, mint & menthol, and chocolate & vanilla are projected to exhibit a slight decline in their market share by 2024.
France, Germany, UK, Italy, and Spain (EU5), the largest market for cigars and cigarillos, is projected to witness a slight decline in its revenue share by 2024. In addition, the cigar and cigarillos market in Germany and France is projected to register 2.5% and 1.9% CAGRs respectively.
Expansion of product portfolio remains a key market strategy for manufacturers. Mergers and acquisitions and new product launches remain a key component of market consolidation.
Targeting both online as well as offline retailers, manufacturers are focusing on expansion of distribution networks, thereby offering easy availability of products to customers.
According to the World Health Organization demand for cigars and cigarillos is gaining traction among females in Europe.
Key companies profiled by PMR in its report include Imperial Brands Plc, British American Tobacco PLC, Japan Tobacco, Inc., Swisher International Inc., Swedish Match AB, and Altria.