Smokeless tobacco continues to be a steady favorite among convenience store customers, with retailers stocking popular items and offering promotions when available.
Smokeless tobacco dollar sales at convenience stores increased by 5.1% to reach $7 million for the latest four weeks ending July 10, 2022, according to Chicago-based market research firm IRI.
Chewing tobacco/snuff decreased marginally in dollar sales by 1% to $5.5 million, while spitless tobacco increased in dollar sales by 35.9% to $1.5 million for the four-week period.
Smokeless tobacco jumped only 3.3% in dollar sales to hit $8.8 billion for the latest 52 weeks ending July 10, 2022. Chewing tobacco/snuff decreased by 2.1% in dollar sales for the 52-week time period, and spitless tobacco shot up by 35.3%, per IRI.
Smokeless Grows in C-Stores
For Pete’s Convenient Stores, which operates 50 stores in Missouri, Kansas and Oklahoma, moist represents 59.31% of the total “all other tobacco” category and 18.22% of the total tobacco category.
“Moist and vape continue to be important to the tobacco category. We have given more space to both products to allow our customers to have choice and ensure we have product available,” said Brenda Elsworth, chief operating officer of Pete’s Convenient Stores.
Pete’s devotes two to four feet of space to the segment within the tobacco set, depending on the store. Copenhagen brings in the strongest sales in the segment for the chain.
At The PRIDE Stores snus products are exclusively featured in a separate refrigerator on the tobacco back bar. It also displays some Camel snus products within the tobacco pouch section, said Chris Peckat, director of purchasing at The PRIDE Stores, which has 15 locations in the Chicago area and one site in Indiana.
“We think this category is important to our sales mix and customer choice. We address this category with the intent of having zero out-of-stocks and offering promotions as often as possible,” added Elsworth.
For Cenex Zip Trip, which operates 40 stores with the recent addition of a truck stop outside of Sioux Falls, S.D., ZYN is performing well, especially since the chain added ZYN zones into most stores. Its overall unit sales are within 10% of total Copenhagen numbers.
Cenex Zip Trip ideally tries to merchandise all smokeless products together, yet smaller spaces do not always allow the c-store to do so.
“Most of the items in the smoke-free, spit-free nicotine categories are doing well, while the traditional smokeless segments … are struggling, with the exception of Skoal,” said Jon Fleck, merchandise manager, Cenex Zip Trip.
Fleck noted that with the high cost of fuel and downturn in gallons purchased, the chain struggled over the past seven months to reach its 2021 sales at many sites. Despite this, the smokeless category had an almost 8% increase in sales.
“The popularity of ZYN along with the program offered by Swedish Match really helped us grow the category,” Fleck stated.
Under the Radar of Regulation
As FDA regulation impacts cigars and cigarettes, as well as e-cigarette and electronic nicotine delivery system products, retailers can be satisfied that smokeless tobacco is not currently under new FDA scrutiny.
On the regulation front, in October 2019, the FDA authorized the marketing of eight Swedish Match USA Inc. snus smokeless tobacco products sold under the “General” brand name through the modified risk tobacco product (MRTP) pathway.
In October 2021, four new oral tobacco products manufactured by U.S. Smokeless Tobacco Co. LLC under the brand name of Verve were authorized for marketing.
Additionally, in April 2022, the FDA released a report detailing its attempt to warn male youths aged 12-17 in rural areas of the effects of using smokeless tobacco. The campaign was launched in April 2016 and concluded in 2020.