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Retailers React
Tobacco Gantries

The Tobacco gantry change, introduced nationally in April 2015 added restrictions on how retailers should merchandise, promote and display Tobacco products. The primary objective of this change was to reduce uptake of smoking in younger people, as well to change the buying habits of established smokers. Retailer opinion on whether these changes have had an effect is divided. In anticipation of further changes to Tobacco retailing are due in May 2016 so we’ve carried out research into how Tobacco sales have changed in the nine months since going dark.

What do retailers think?

To gauge the opinion of retailers we reached out to users of our ShopMate EPoS system. When asked whether they agreed with the statement that I have found that my Tobacco sales have fallen since the Tobacco gantry changes in April 2015 the responses were varied.

Key points
  • More people agreed with this statement than disagreed (45% vs. 33%)
  • A fifth of people were neutral – neither agreeing nor disagreeing with the statement (20%)
  • The strongest performing with ‘strongly agree’ with a quarter of all respondents (25%)
With conflicting statements about the effectiveness of closed Tobacco gantries pre and post change, it’s no surprise that retailer opinion is divided.
How are retailers performing with closed Tobacco Gantries?
To see whether the concerns of 45% of our respondents were indeed taking place, we analysed EPoS data from over 3,000 tills trading throughout the UK. Convenience retailers have always been adept at weathering any storm, and it would appear that this case is no different. Sales across the convenience sector continue to rise at a healthy rate, both regarding value and unit sales. IGD anticipates the UK grocery market to increase in value by 13% and, certainly in convenience Tobacco could be an important part of that growth.
So…should retailers be worried?

With regards to Tobacco gantries? We don’t think retailers should be worried about sales. As well as the data so far painting a positive picture, markets where these changes have been in place for some time like Australia have only seen availability negatively affected. Considering the lack of alternatives to smoking, poor brand choice is unlikely to reduce sales in the category as a whole but may instead drive shoppers to secondary choices or even completely new brands.

What about future changes?

We’re currently carrying out research into the Australian market and how plain packaging, introduced in 2012 has changed habits and affected retailers. Click here to subscribe to TRDP Insights and be the first to receive this story.

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