At the Present Time


Electronic cigarettes and vapor products draw the most attention in any conversation today about the tobacco category. However, to concentrate only on these emerging — and rapidly changing — segments is an injustice to the other products residing on the back bar.

An exclusive tobacco retailer study conducted by Convenience Store News found that 100 percent of the convenience store operators surveyed carry cigarettes and other tobacco products (OTP) in their stores. Slightly less, at 91.1 percent, carry electronic cigarettes and only a little more than two-thirds of the retailers carry vapor products.

In terms of category performance, while retailers reported that the net change in cigarette unit sales was down 2.5 percent, the majority of retailers noted that their cigarette unit sales on a per-store basis either increased or stayed the same in 2014 vs. 2013. Only 21.3 percent reported decreases, which were large enough to pull the average to a decline. The retailers painted a similar picture for OTP dollar sales, with only 17.6 percent reporting a decrease in the same time period. (CSNews did not poll retailers about their cigarette dollar sales because taxes vary so widely from state to state.)

Breaking down OTP by segment, just about half of respondents (52.6 percent) said their smokeless tobacco dollar sales increased from 2013 to 2014 and a little less said their cigar dollar sales increased (41.6 percent). Both segments, however, notched noticeable declines for other respondents: 37.7 percent for cigars and 32.9 percent for smokeless tobacco.

The CSNews retailer study also found more evidence that the e-cigarette segment is beginning to level off. About a quarter of respondents said their e-cigarette dollar sales — which includes disposables, rechargeables, kits and cartridges — remained the same year over year, while 18.3 percent said their sales had actually decreased.

Not surprisingly, the majority of retailers (62.3 percent) reported an increase in dollar sales of vapor products, which includes vaporizers, vape pens and e-liquids. That jump could be a result of more retailers now offering vapor products. For example, 18.9 percent of respondents indicated they added vapor products to their lineup less than six months ago, 24.5 percent added them six to 12 months ago, and 52.8 percent added them in the past one to two years. On average, survey respondents first started offering vapor products 1.2 years ago.

As further evidence of e-cigarettes leveling off and vapor products exploding onto the scene, 54.2 percent of the participating retailers said they are offering more vapor brands today vs. last year, while 43.1 percent are carrying the same amount of e-cigarette brands. On average, retailers carry 4.3 brands of electronic cigarettes and 3.1 brands of vapor products.

Shelf space allocation in the stores is shifting as the popularity of the various tobacco segments ebbs and flows. Just about half of the respondents indicated they are upping their space allocation for e-cigarettes (47.7 percent) and vapor products (53.1 percent).

Where are they finding the space? According to the study results, 25.4 percent of the retailers have decreased cigarette space. While it may be easy to say e-cigarettes and vapor products have moved into this real estate, two-thirds of respondents said their allocation for cigarettes has stayed the same. Cigars, papers and pipe/cigarette tobacco have all seen double-digit decreases in shelf space, so the shift is more than likely being spread out across several segments.

Interestingly, though, not all vapor products are created equal in c-stores. While a sizeable number of retailers said they currently carry e-liquids, e-cigars and e-hookahs, just as many if not more said they do not and don’t plan to add them to their tobacco category mix.

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