According to Him! Research, 1 in 3 convenience retailers believe that the display ban on tobacco has had an impact on sales – 29% say a negative affect, 7% positive, and 1 in 4 say it has affected overall footfall to their store.

July 13, 2016
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Trading in the Dark – The display ban

According to Him! Research, 1 in 3 convenience retailers believe that the display ban on tobacco has had an impact on sales – 29% say a negative affect, 7% positive, and 1 in 4 say it has affected overall footfall to their stores. The Retail Data Partnership (TRDP) have analysed their own data that suggests otherwise, and have uncovered insights that will help retailers think differently about trading tobacco in the dark.

The ban of tobacco displays at the point-of-sale was enforced in large retailers such as Asda, Tesco and Morrison’s from April 2012, and was introduced in smaller retailers from April 2015, which has been the biggest change that has affected independent convenience stores.

‘two-thirds of smokers start before the age of 18, so it was vital that everything was done to put Tobacco out of sight to protect future generations from harm.’

This will go hand-in-hand and work with the standardised plain packaging for Tobacco products that will be actioned as of May 2016 to further protect children and young people from Branded Tobacco.

‘Cigarettes and Tobacco are a major pull for shoppers with a massive spend of £13 billion on Tobacco in the UK in 2012. And as the numbers of cash-strapped adult smokers choosing to roll their own Tobacco continue to grow, demand for many of the Tobacco market’s own tools of the trade (papers, filters and rolling machines) are also on the up’ (The Jordan Group Supply 2015).’

The Tobacco display ban not only requires change to be made to the way that Tobacco is merchandised but also introduces tight restrictions around how to serve customers and how to present the price list for Tobacco products. If a customer was to ask how much a Tobacco product costs, the retailer is not allowed to verbally communicate the price and instead must give the customer a printed tariff document, the style of which is also heavily restricted.

These strict changes are believes to have caused a fall in sales which in turn, would affect overall footfall and profits.

According to The Grocer, Tobacco sales have fallen in more than a third of convenience stores after the display ban.’

But TRDP have analysed weekly Tobacco sales across 100 shops from October 2014 to November 2015, and discovered an interesting outcome.

The data indicates that in the 6 months before the display ban was introduced, average weekly Tobacco Sales were approx £75,000. Throughout the 6 months following the introduction of the display ban, sales actually increased by 4.9% to approx £77,000 a week. Something to consider is the notable trough that appeared in the early months of 2015 which may take place again next year. Figures currently show however that sales are on the rise. This finding is consistent with self-reporting from Tobacco customers.

According to Him! Research, retailers didn’t think that their customers’ overall smoking habits had changed since the ban – 63% of convenience shoppers who smoke said their Tobacco purchasing habits had not changed at all since the ban vs just 25% who said they definitely had.

Our data tells us a lot about customer behaviour. Towards the end of December in 2014 and before the gantry change, sales dropped by 1.46%. This could be related to New Year Resolutions and people changing their behaviour for a short period. From then onwards, the trough gradually recovers until March, suggesting this behaviour change was somewhat short-lived.

There are some conflicts between the data we have presented and that of William Reed Business Media (Convenience Store, The Grocer, Him!). We think this is because our data comes directly from our own Customers, polled from their tills and internally analysed. We only use data that we have sourced and can guarantee.

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