Tobacco in the United Kingdom

Tobacco in 2024: The big picture

Tobacco in the UK witnessed a sharp decline in volume and value sales during 2024, underpinned by the shift away from cigarettes and fine cut tobacco. In combination, these two products generate the majority of value sales in UK tobacco. Smoking prevalence has continued its downward trend, falling from over 12% in 2023 to just under 12% in 2024. The broad shifts in consumer behaviour are being driven by rising health awareness, regulatory changes, and higher taxation rates. Rising prices, largely influenced by excise tax hikes and inflation, continued to heavily impact the tobacco industry, since price sensitivity remains one of the most significant factors shaping purchasing decisions. As a result, many consumers are either reducing consumption, downtrading to lower-cost alternatives, or seeking out emerging products, such as heated tobacco and nicotine pouches. Categories positioned at lower prices, such as cigarillos, are benefitting from strong price-sensitivity.

2024 key trends

Cigarettes remained the largest category in 2024, despite the contraction in volume and value sales. Rising health awareness, continued duty increases, and evolving consumer preferences are driving change, with many price-sensitive smokers shifting to more affordable alternatives, such as e-vapour products and heated tobacco. Notably, many smokers are now combining cigarettes with other nicotine products, particularly e-vapour, as dual use becomes more common. According to Euromonitor International’s Voice of the Consumer: Nicotine Survey (fielded January to February 2024), the number of users who smoke both cigarettes and heated tobacco products at least monthly grew by one percentage point compared to the previous period in 2024. In the meantime, the dual combination of cigarettes and e-cigarettes increased by almost three percentage points. This pattern is especially prevalent among younger adults, reflecting the use of vaping as a tool to transition away from cigarettes, and its acceptance in smoke-free environments. Despite these pressures, cigarettes still dominate overall sales, but their share is being steadily eroded as consumers seek less harmful and more cost-effective options.

Competitive landscape

Imperial Tobacco Ltd was the leading tobacco player in 2024. The company produces Player’s, Lambert & Butler, Golden Virginia, Gold Leaf, John Player Special, Richmond and Blu brands, amongst others, and is present in cigarettes, fine cut tobacco, cigars, cigarillos, and e-vapour categories. The company has innovated in the e-vapour category with its Blu Bar 1000 disposable product, offering 1,000 puffs per device. Following this, the company launched Blu Bar Kit & Pod in July 2024, which is a compliant closed-system rechargeable vape. These innovations have helped the company to shift into smoking alternatives, although it has not been sufficient to mitigate the loss in share from its tobacco brands.

Retail developments

Convenience stores was the leading distribution channel within tobacco overall in 2024. Cigarettes and traditional tobacco products are still dominant choices of tobacco and convenience stores are key to their distribution. Even though cigarette consumption is in decline, consumption is still high benefiting convenience stores. Indeed, convenience stores have solidified their status as the leading retail channel through the sale of smoking alternatives. The importance of the convenience store is driven by the channel’s accessibility, ability to facilitate impulse purchases, and strong relationships with major tobacco companies, who often provide tailored incentives and promotional support. The continued expansion of convenience store networks and their focus on stocking a broad range of both traditional and alternative nicotine products have made them a crucial touchpoint for consumers seeking both established brands and new innovations. In addition, the introduction of new regulatory requirements, such as the extension of the Track and Trace system in May 2024, has reinforced the importance of compliance and operational efficiency for these retailers.

What next for tobacco?

Tobacco in the UK is undergoing significant transformation, shaped by regulatory tightening, shifting consumer preferences, and innovation in reduced-risk products. Traditional categories like cigarettes and fine-cut tobacco continue to dominate in value terms but are set to decline further as public health initiatives, higher taxation, and stricter regulations accelerate the move towards a smoke-free society. The government’s ambition to achieve an adult smoking prevalence of 5% or less by 2030 is driving major tobacco companies to increase investment in next-generation products, including e-vapour, heated tobacco, and nicotine pouches. British American Tobacco is actively investing in smokeless alternatives to achieve its goal of a predominantly smokeless business by 2035, and Philip Morris International aims to generate at least two-thirds of its revenue from smoke-free products by 2030. While traditional tobacco products still hold the largest share of sales, the demand is clearly shifting toward smoking alternatives, especially among younger and more health-conscious consumers.