The Vape market is growing and some cigarette companies are making a profit. Cigarette companies have their backs to the wall but some are doing better than others, such as Imperial Brands.
The brand behind Winston, Gauloises, and Kool cigarettes is rubbing its hands together seeing the yearly sales figures. Unlike many of their competitors who have seen sales figures tank, profits for Imperial Brands will most likely exceed all expectations. The British corporation has stated that these positive results were made possible thanks to investment in vaping.
Diversification of activity for Imperial Brands
Imperial brands was negatively affected when the vape market took off, which led to a dip in tobacco sales. Philip Morris and British American Tobacco, Imperial’s main competitors, were quick to invest in this new market. Imperial Brands chose to adapt by investing heavily in vaping.
The group is looking to invest more than 100 million pounds in Blu, their flagship vaping device. The group also plans to launch a heat-not-burn tobacco device in the first quarter of 2019 in Japan. This system, said to be harmless as tobacco does not undergo combustion, will feature an age-proof lock system. But the group is not resting on its laurels, instead Imperial Brands is pushing forwards to invest in innovation and diversifying activities.
This strategy seems to be paying off, since the Group’s 2019 profits are once again expected to be positive. This information has generated a real confidence boost in the stock market, with a 1.5% growth in the London exchange. Imperial Brands is no longer worrying about being overtaken by its competitors, who spearheaded the heat-not-burn tobacco line. But the group’s investment in “age-proof” devices seems to be represent one of their biggest pay-offs given the evolution of regulations in the sector.
Tobacco company will be at each others’ throats for some time, given the slowly dwindling market available to them. After classic tobacco cigarettes, they are looking to innovate to meet customer needs while respecting public health.