The Tobacco Battle: Who's Winning?

CSPNetwork CyberConference to look at challenges of the tobacco category

Published in CSP Daily News

NEW YORK -- Cigarette volume continues to decline, with industry volumes falling nearly 2% in 2004, according to the Management Science Associates Inc., which works with market leaders covering 90% of the domestic cigarette market.

With that, who's winning in this hardscrabble battle that generates one-third of all sales inside the convenience channel? In an exclusive report to be disclosed in a special 60-minute CSPNetwork CyberConference event tomorrow, Smith Barney Tobacco Analyst Bonnie Herzog delves into the performances of the leading premium market, [image-nocss] as well as the third and fourth tiers in the multi-billion-dollar cigarette market and the growing smokeless trade.

The cyberconference, Tobacco 2005: Evaluation to Opportunities, will be held a 2 p.m. Eastern. To register now, click here. The first 40 retailers to register are free.

It appears that Philip Morris USA, Lorillard and the fourth-tier category gained market share during 2004, taking share from Reynolds American, Herzog said, adding that Lorillard is the only manufacturer to enjoy increased shipment volumes for 2004.

Known for her forecasting and comprehensive reach of the entire tobacco business, Herzog on Thursday will span the country examining the impact of increased state excise taxes. She will also delve into pricing and marketing strategies of the major manufacturers and explore the effect third- and fourth-tier cigarettes are having on overall tobacco sales.

Herzog also offers her unique insights into the likely spinoff of Philip Morris USA from The Altria Group and what a freestanding Philip Morris could mean to the convenience channel's most important category.