Deep Analysis of Impact of COVID-19 on “Cigar & Cigarillos Market 2019-2025” Growth Worldwide….
The global cigar and cigarillos market size is
expected to reach USD 21.02 billion by
2025, according to a new report by Grand View Research, Inc. It is
anticipated to register a CAGR of 3.1%
during the forecast period. Implementation of heavy taxes and increasing price
of conventional cigarettes drive the product demand. Increasing number of
consumers prefer cigars as they have better reputation and lower price, which
is projected to positively influence growth.
The global market is
getting more and more diversified with the availability of products in all the
range and flavors. The top most competitors are Nicaragua, the Dominican
Republic, Honduras, and Brazil. In recent days various verities are launch by
the manufactures to gain greater market share. Many regional and domestic
players are entering into the market with a unique and innovative products to
gain customer base. Recently, in Europe, Switzerland entered into cigar
manufacturing and Swiss brand “Davidoff” which is gaining popularity as a brand
with unique quality of the product. Moreover, Nicaragua innovated organic cigar
with a brand name “Plasencia”, which is expected to gain popularity in Asia,
especially in the China.
The mass segment held major market share of global market
owing to the growing popularity of cigars and cigarillos among the young
consumers. Moreover, growing number of female consumers in the developed
countries is expected to fuel the demand for mass products over the forecast
period. However, the premium segment is expected to expand at the highest CAGR
over the next seven years. Presence of luxury hotels and bars with cigar
lounges, in developed countries, such U.S., U.K., and China have made comeback,
thus, the consumption has increased drastically.
The flavored product segment is expected to expand at a CAGR
of 3.2% over the forecast period. Many new consumers prefer flavored cigars as
the taste is perceived to be better than the natural tobacco flavored products.
Moreover, many consumers are migrating from other tobacco products including
conventional cigarette to cigar and cigarillos. In addition, many companies
have launched various flavored product to attract consumers, fueling the
demand.
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The global cigar and cigarillos market
size was valued at USD 16.99 billion in 2018. It is expected to expand at a
CAGR of 3.1% during the forecast period. The global market is expected to
witness substantial growth owing to the increasing number of luxury hotels with
cigar lounges. Following the worldwide ban on smoking in public places, such
lounges and bars are making appearance in luxury hotels and bars. For instance,
DUKES Hotel of London welcome its stogie-loving visitors in the cognac and
cigar garden. The secluded courtyard located behind the hotel offers a list of
cognacs to accompany the Cuban cigar.
Further key findings from the report
suggest:
·
In terms of revenue, the premium product
segment is projected to ascend at a CAGR of 3.3% over the forecast years
·
The mass product segment led the global
market with an overall revenue share of over 82.3% in 2018
·
Flavored segment was valued at USD 4.93
billion in 2018, is projected to exhibit a high CAGR in the next few years
·
North America led the global cigar and
cigarillos market in 2018, with 57.0% of revenue share and is projected to
continue leading over the forecast period
·
Growing number of young consumers including
men and women is further expected to propel the growth
·
The market is highly competitive in nature.
Major companies include Altria Group, Inc.; Habanos S.A.; Scandinavian Tobacco
Group A/S; Gurkha Cigars; Swisher International, Inc.; Agio Cigars; Swedish
Match AB; OETTINGER DAVIDOFF AG; Drew Estate; and Trendsettah USA, Inc.
·
Various manufacturers are concentrating on
new product launches, capacity expansions, and technological innovations to
cater to the existing and future demand patterns from upcoming product
segments.
Introduction of various flavors including wine, tea,
chocolate, and vanilla to mask harsh taste of tobacco is fueling the demand
among the young consumers. Flavored product is the most popular variety among
the premium cigars. The flavors such as sweetened tobacco product like swisher
sweet and white owl are leading the market for generations, while flavored
product like Tatiana, Acid, and Java have contributed in increase in demand for
flavored product in last 15 years. In addition to this, companies operating in
the tobacco product industry are conducting R&D activities in order to
offer better tobacco quality and innovative flavors to compete in the market.
China is one of the
prominent markets for premium cigars and is expected to become largest markets in
the upcoming years. Traditionally, cigar was considered as luxury tobacco
product, which is purchased by rich, middle aged consumers. However, increasing
penetration of low cost product coupled with growing number of young
billionaires in China is expected to promote the usage on a domestic level.
Moreover, Cuban cigar manufacturers are focusing on increasing their market
reach through the strategic collaboration.
For instance, in 2017,
Habanos S.A. signed an agreement with the China National Tobacco Corporation to
increase import of premium cigar. The company is focusing on training their
sales force along with increasing spending for the expansion of their
distribution networks. However, Habanos S.A. is facing challenge in increasing
awareness related to the various brands such as Montecristo, Romeo, and
Julieta, on account of increased visibility of Cohiba, one of the island’s
leading brand popular among Chinese consumers.
Demand for Cuban cigar is
expected to witness significant growth in India on account of increasing
concentration of cigar clubs in cities including New Delhi, Bengaluru, Mumbai,
and Kolkata. The demand is attributed to growing brand awareness among the neo
rich coupled with increased influence of western culture among young consumers.
However, the lack of adequate choice and limited marketing due of stringent
government regulations on advertising of tobacco-related products are expected
to hinder the growth in near future.
Browse Press
Release of this report:
Mass cigar held the
largest market share of 82.3% in 2018. Compared to premium, mass products are
likely to be most preferred by young consumers. Mass category products are
machine made and are less expensive compared to premium category products,
owing to which, young consumer, mostly high school students opt for mass
category products. In addition, mass category products are available in various
flavors such as mint, chocolate, menthol, and vanilla which has led to rise in
consumption.
Premium cigar segment
is expected to witness the fastest growth over the forecast period on account
of growing demand from luxury hotels and bars. Furthermore, premium products
are handmade and are witnessing significant demand from developed markets such as
U.S., U.K., and China. Growing popularity of unique taste and favor is
positively influencing the demand for this category since the past few years.
Moreover, online stores are witnessing strong demand for premium category which
is expected to drive the market during the forecast period.
Grand View Research has segmented the global cigar and cigarillos market
on the basis of product, flavor, and region:
Cigar &
Cigarillos Product Outlook (Revenue, USD Million, 2015 - 2025)
·
Mass Cigar
·
Premium Cigar
Cigar &
Cigarillos Flavor Outlook (Revenue, USD Million, 2015 - 2025)
·
Tobacco/No Flavor
·
Flavored
In 2018, tobacco/no
flavor segment led the market in terms of revenue share and is expected to
maintain its dominant position over the forecast period. The segment was valued
at USD 12.05 billion in 2018 and is expected to expand at a CAGR of 3.0% from
2019 to 2025. Most of NORDIC population preferred no flavor tobacco products,
followed by chocolate and vanilla flavored tobacco products.
Flavored products are
expected to witness significant growth over the forecast period owing to the
rising popularity of flavored products among young consumers. Moreover
increasing number of female consumers is expected to boost the scope of demand
for flavored products over the forecast period. Among the various flavors,
fruit-based flavors are the most preferred, but sale of non-descriptive flavor
such as wine, tea, and Jazz are expected to witness substantial growth in near
future.
About Grand View Research
Grand View Research, Inc. is a U.S.
based market research and consulting company, registered in the State of
California and headquartered in San Francisco. The company provides syndicated
research reports, customized research reports, and consulting services. To help
clients make informed business decisions, we offer market intelligence studies
ensuring relevant and fact-based research across a range of industries, from
technology to chemicals, materials and healthcare.
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