As we wrote this in early November, the focus of the UK e-cigarette industry was on regulatory change – the confirmation in the Budget of the Vaping Products Duty (still a long way in the future) and the formal introduction into Parliament of the Tobacco and Vapes Bill, complete with the possibility of retailer licensing.
Neither of these was exactly unexpected, and although of course there are usually downsides as well as upsides to any significant new regulation, neither should be seen as a major negative.
In particular, retailer licensing may aid enforcement against the illicit market and help to bolster the reputation of the legitimate industry, while the exclusion of vapour products from the proposed birthdate-based sales ban shows that – despite some recent hardening of attitudes – Britain’s government remains convinced by the vision of harm reduction. Perhaps the honeymoon is over, but we’re still a long way from the divorce stage.
Coincidentally, it was very shortly before these two developments that another piece of good news for the UK vape industry emerged, in the form of ECigIntelligence’s latest UK snapshot. We publish these snapshots regularly for a range of countries, combining commentary with data on market size, product formats, leading brands, and so on.
Overall, we concluded that “the UK e-cigarette market continues to show impressive growth in 2024”, and looking ahead to 2025 we forecast it to get very close to £2 billion in value. It will, in fact, have doubled in size in only four years (although admittedly 2021’s figure was slightly depressed by the pandemic; the market had actually been a tad bigger in 2019).
Set against this encouraging headline number we did note that “an overwhelming portion of the market’s growth can be attributed to disposables”, with 30% of British vapers now using them, and of course this means that next year’s disposables ban does raise an obvious concern. Will the overall vape category manage to retain those consumers even if their preferred product format is no longer available?
There are good grounds to be positive about this, though – because, as we said in our snapshot, the popularity of disposables is already starting to decline anyway. It doesn’t appear that consumers are so wedded to these products they’ll just abandon vaping when disposable devices disappear.
Still, exactly what replaces them remains something of an open question. As we note, pre-filled pod products are becoming more prominent in retail. But we think this is probably down to companies themselves anticipating the disposable ban, rather than customer tastes; the trend toward pre-filled pods “does not seem to be driven by the demand side”. Instead, “consumers are increasingly opting for refillable open pods, the fastest-growing category”.
And what of vape stores themselves? Well, there’s good news here too: the strength of the UK market is underlined by an increase in the number of specialist retailers. Large chains, in particular, have been growing.
Combined with the recent suggestion from another researcher (the Global State of Tobacco Harm Reduction project) that vaping will soon overtake smoking in the UK – a pretty astonishing landmark that back in 2014 would have seemed like a distant dream – all this data seems to confirm that the UK remains among the biggest success stories for e-cigarettes.
There will be issues to deal with, of course – not just from regulation but also from the increased competition offered by nicotine pouch products.
And there is also a longer-term, strategic question mark over the customers of the future. Given declines in smoking, the number of smokers who have already gone over to vaping, and a (theoretical) end to the creation of new smokers once the birthdate-based sales ban comes in, who will be the new vapers of the 2030s? Will there actually be enough smokers left that the e-cigarette market can continue to thrive by converting them to the safer alternative?
That will be a difficult question for the industry to tackle, because it may involve a choice between accepting much-reduced growth, or more openly marketing to non-smokers. The potentially explosive implications of the latter hardly need to be spelled out, and some serious thinking for the industry lies ahead. But for the meantime, we see the UK as a healthy market that should be resilient to its immediate challenges.
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Enjoyed reading this article? Read some of EcigIntelligence’s other exclusive pieces published by Vapouround including The Latest Analysis on Vaping Hardware in the UK and Is the Rise in Nicotine Pouch Sales a Cause of Concern for the UK Vape Sector?
