A Midwestern retailer pointed to greater efforts by some of the major players to drive volume by state.

"Philip Morris is working harder on by-state discounting to raise volume," the retailer stated. "Lorillard has gone extra-deep discount in Pennsylvania and Ohio to drive up volume; first time I've seen them go extra deep in several years. RJR continues to fine tune its discounting by state on Camel and Pall Mall and eliminating discounting on Doral, Salem and Kool in some states."

The change in marketing strategies should not be misconstrued as a pullback by big tobacco, rather the contrary. "The major tobacco companies are becoming more sophisticated in how they promote their brands," Modi said. "The one-size-fits-all model is inefficient. The ability to generate positive net pricing is very important for tobacco companies to hit their external profit goals to Wall Street."

The survey is the second in an exclusive partnership between CSP and Modi concerning tobacco trends in the convenience-store channel. It was conducted in early October and includes nearly three dozen convenience chains representing more than 10,000 stores in the United States and featuring some of the industry's largest companies.

The study coincides with another Modi conducted, this one with the National Association of Tobacco Outlets, of the tobacco-shop sector. In that survey, 64% of tobacco outlets surveyed said manufacturers have cut promotional programs, while 36% said promotions have increased.

[Click here to view part 1 of this series: Big Tobacco Fights for Share.]

On Thursday, Dec. 3, Modi will provide insights into key tobacco segments during a CSPNetwork CyberConference. Click here for more information and to register.