42 / 60
C
ELECTRIC
ALLEY
[
01
/
02
|
17 ]
[ 42 ]
TOBACCO BUSINESS INTERNATIONAL
[ 01
/
02
|
17 ]
Can convenience stores take on a more sophisticated vape
stance? What about a vape shop concept within? Sure, space
is tight and streamlining is a must, but timing may be right
for the convenience channel to attract more vape shop cus-
tomers with a little help from e-cig/vapor manufacturers.
To back up a bit, at the National Association of Con-
venience Stores (NACS) conference in Atlanta this year,
Wells Fargo tobacco and convenience store analyst Bon-
nie Herzog observed that manufacturers are increasingly
becoming a key source of consumer insights for retailers,
“which should benefit the convenience store industry as a
whole,” she says. “C-store sophistication continues to ex-
pand as manufacturers increasingly focus on technology
solutions to drive incremental sales at retail. Overall, we
believe manufacturers continue to raise the bar to support
strong sales growth for c-store retailers and are encouraged
by the stepped-up innovation and technological sophistica-
tion that should support ongoing growth in c-store sales.”
She was speaking about top brands from key categories,
including tobacco/vapor, where the likes of Altria Group,
Reynolds American and Logic reign. According to industry
estimates, e-cigs remain a highly profitable business with
operating margins averaging 36-38 percent versus 13-14
percent for conventional cigarettes—and this is with e-cigs
taking up only 10 percent of tobacco’s share of c-store space
and generating only 2-3 percent of industry revenues.
Altria Group beefed up its vapor lineup with MarkTen
XL Bold, which, according to Wells Fargo, is reportedly
helping the c-store channel realize “attractive” margins in
the 30 percent range.
On the market since April 2015, MarkTen XL has
been described as a better-performing product that fea-
tures two times the liquid and battery life of previous
MarkTen products.
Green Smoke, also an Altria brand, offers a zero mg nic-
otine version, unlike MarkTen. The catch is, it is still pri-
marily an e-commerce brand, although Altria is currently
testing it in a select few convenience stores.
Vape Opportunity
Knocks on
Convenience's Door
Top e-cig/vape manufacturers are stepping up technology
and support for the convenience store channel to
play more of a vapor role.
BY RENÉE COVINO
VAPOR
PRODUCTS