For the first time in two decades, cigarette sales increased last year during the COVID-19 pandemic, as tobacco companies also beefed up spending to promote their products.
The Federal Trade Commission, in its annual Cigarette Report, said that manufacturers sold 203.7 billion cigarettes in 2020, up from 202.9 billion in 2019 — an increase of 0.4%.
The FTC compiled the report from data submitted by four major tobacco companies — Altria Group, the maker of Marlboros; ITG Holdings USA, which makes Winston and Kools; Reynolds American, with brands such as Camels and Pall Malls; and Vector Group Ltd., maker of Pyramid brand cigarettes.
The companies, the report said, increased advertising and promotion to $7.84 billion in 2020 from $7.624 billion the previous year, concentrating the bulk of their spending in “price discounts paid to cigarette retailers in order to reduce the price of cigarettes to customers,” the FTC said.
The report did not indicate if the coronavirus pandemic, and the ensuing lockdowns last year, had anything to do with the increase in sales, but Bloomberg reported in April 2020 that Altria’s first quarter sales had jumped partly as a result of “bulk purchases — what the company calls ‘pantry loading,’ ” suggesting that smokers stocked up on cigarettes fearing shortages.
“In 2020, total nicotine consumption in the U.S. was up 3.4%,” Don Burke, senior vice president at Management Science Associates in Pittsburgh, told CSP. a convenience-store trade journal, in August. “So clearly the pandemic had an impact on the overall total nicotine delivery category.”
But the increase in sales last year looks unlikely to represent a long-term trend. Nielsen’s convenience-store report for a four-week period ending on March 27 of this year showed that overall sales of traditional cigarettes were down 4.9%, as reported by The Winston-Salem Journal.
Meanwhile, in the same Nielsen report, sales of electronic cigarettes were down slightly, although they had risen 7.5% year over year.
In recent years, sales of traditional cigarettes have steadily declined, while e-cigarettes have seen a surge, particularly among minors.
A report by the Centers for Disease Control and Prevention last year indicated that one in five high school students and more than 6% of U.S. adults now say they vape.
Content created by Scott Neuman
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