Monday, 28 July 2008

Brands up to snuff?

There is a small revolution going on in the tobacco sector, and the main players may not have even noticed. But it could over the next few years change the nature of the market, and save a few lives at the same time.

Snuff, (the dry tobacco that you sniff, note: not snort) the product that brings to mind elegant georgian dandies brandishing their jewell encrusted snuff boxes is making a comeback, and strong branding is a key feature of the marketing mix.

Snuff was the main way tobacco was taken 200 years ago (at least in Britain), far outselling pipe tobacco. It had taken longer for the British to take to snuff, which had long been a European passion, but during the 18th century snuff became a phenomenon - something every man and women of culture took, in astonishing quantities. Napoleon was said to use 7 lb. of snuff a month!

Snuff went into a steep decline as the popularity and availability of machine made cigarettes increased. It still survived as the nicotine product of choice by workers like miners and factory workers, where fear of fire prevented 'sparking up'.

By the 1980's snuff was down to a few specialist suppliers, the big guns of the tobacco trade having long lost their enthusiasm for the product and followed where the profits were greatest. Cigarettes.

Come the turn of the millennium and the landscape has really changed, the full health implications of smoking are now known, and the opportunity to smoke is under serious attack, it seems the game is up for smoking (at least in the 1st world countries), and smoking in public is becoming seriously difficult.

And this is where snuff might make a comeback. Firstly there is no credible medical research that shows any negative health effects. It's the inhalation of the smoke from the cigarette that causes all the diseases. There are admittedly question marks around nicotine, but no research to suggest that the sorts of quantities in snuff are any more dangerous than say drinking modest amounts of coffee or the odd glass of wine. 

Many of the snuff manufacturers have been in business 250 years, and have had not one claim or prosecution in their records. Anti-smoking activists might prefer to suspect that snuff must surely have some problem associated with it, but the research and crucially anecdotal evidence simply isn't there, and actually tobacco (unsmoked) has traditionally been associated with many health giving properties.

And the news gets even better. Many people (including myself) have found that the best way to give up smoking is to simply take snuff whenever you have a hankering to smoke. It also has the benefits of tactile accoutrements - i.e. things to do with your hands. The tins and snuff boxes and colourful handkerchiefs give you plenty to take your mind off smoking, and you don't have to go outside to do it - you can snuff to your hearts content at your desk!

Unlike smoking, where the majority of smokers are incredibly brand loyal, the general snuff taker doesn't so much take snuff, as collect it. And there are now plenty to collect. Probably for the first time in a generation brands are launching, to take advantage of the voracious snuffers appetite for new brands and new snuff experiences.

A small collection from a snuff taker called 'Filek' on one of the many online forums

Snuff comes in different textures and moistness, and crucially in literally hundreds of 'flavour' variations. From traditional 'tobacco' aromas, to florals, menthols and mints, to citruses and spices, and more recently food and drink flavours like chocolate, coffee, cherry and grapefruit, there is even gin & tonic!

And then there is the cost - snuff is not taxed, so a snuffer can indulge their passion for new smells and textures at a fraction of the price of cigarettes. A 25 gm tin of snuff will cost you less than £3.00 and last - well a long time... A pinch in each nostril roughly equates to the nicotine of one cigarette, and there is a mighty number of pinches in a tin!

So the average 'collector' doesn't just have a handful of different snuffs, they have shelves of them, drawers full of precious tins and tempting aromas. And snuffers are passionate about their 'hobby', there are specialist websites where snuffers exchange views on flavours, qualities and everything under the sun you could think of about snuff.

There are online shops breaking out all over the world (traditional retailers don't even know most of this exists - when was the last time you saw a tin of snuff in your local newsagent? Ever?), and new brands are starting up, offering tempting new packages of nasal promise.

There are a handful of traditional manufacturers, some who have just continued (no mean feat in itself if you were established 250 years ago using a water-wheel), some who have even tried to innovate, experimenting with modern packaging concepts. Interestingly, and possibly uniquely, the avid snuff connoisseur values all the manufacturers, creating an infinite world of possibilities, and all under the noses of the mainstream smoking public, who barely know this sub-culture exists.

New brands are being developed by one man start-ups, exporting around the world, brought together by the online network of enthusiasts. One Indian manufacturer is developing 'western style packaging' as they tap into the online market, and an interesting modern touch is that the brand owners are getting very close to their customers, contributing to the online communities on a personal basis, classic attributes of the passionate brand leader. They don't just listen to what's going on, but use the forums for research, development and just to 'keep it real'.

Where will it go? How big could it get? 

Well the chances are you didn't even know it was going on, it hasn't yet gone mainstream, the major tobacco makers have shown little interest in the area, although cousins of snuff like Snus and Dip (tobacco you stick under your lip) have large and growing markets in the USA and parts of Northern Europe. These products have more dubious health implications, although still far far less deadly than the average cigarette.

It does seem that the issues of health, price, product and brand innovation, the customer's urge to collect and online distribution have coincided to create a fertile ground for a potentially huge market. 

At the moment, the market isn't probably worth much more than £100m worldwide. So if it took off, it could be worth a 1000 times that (and probably then some). The product is presently untaxed, and could cause a serious tax shortfall if customers switched in any significant quantities. How many governments could resist taxing snuff if it seriously offered competition to cigarettes. Of course if it did that, the cost to health services could liberate enormous costs in future years.

The present brands are essentially not competing with each other, such is the nature of the customer usage. If the product was to seriously penetrate traditional retail, then the stronger brands would compete for shelf space, and a more traditional competition model would resume. Brand positioning would seek to carve out space in the greater snuff landscape, seeking to fulfill customer needs. It's likely the newer entrants would do better than the traditional players, since they have not relied on heritage and habit, the new players will be more innovative and experimental.

The real challenge is how to build the market as a whole. Every player will help, but the tipping point for mass awareness is probably a long way off yet, and the anti-smoking lobby may well continue to put all tobacco related products in the same basket. Large brand owners, the manufacturers who years ago lost interest could afford the sort of lobbying and promotion that could build a real platform for growth.

It's possible someone somewhere is going to realise that snuff just could be the most phenomenally profitable replacement for the evils of smoking tobacco. Someone just might make a fortune!

It just needs one serious player to take responsibility to build the market, and the benefits of brand primacy will be theirs, but in the meantime, all the players will help to build a mutually larger market.

What if every smoker turned to snuff, how many people's lives could be saved? 

Probably the main barrier to entry is the indecorous thought of what comes out of your nose, eventually, after you have spent a day snuffing. Still it's better than the thought of what your lungs probably look like if you smoke, and you'll need more than a brown handkerchief and a good blow to get rid of that!

Some of the Interesting Brands:

A longtime german player, they have invested in innovative packaging and are extremely popular in Europe. Their mainly moist menthol inspired flavours are found widely in Europe. 

A UK startup based in Berwick upon Tweed, CEO Roderick Lawrie has created a powerful brand based around lively freshness, mostly food flavours, with contemporary branding and has been nominated for packaging awards. Roderick has spent a fair bit of time researching the market and health issues, and is a strong advocate for the benefits of switching from smoking to snuffing. Imagine the motivation if you thought your brand could actually save lives?

Based in Leicester, England, they have a funky flash based website and a history going back to 1926, and the owner of one of the market standards - 'Original and Genuine'. 

Dholakia Tobacco:  
An Indian company with 150 year history, they have kept their ears to the online ground, and are launching a range to suit more mainstream western tastes. Their traditional products are valued for their fineness and exotic flavour variants. The world is truly shrinking and offers infinite opportunities for the brave and adventurous.

Wilsons of Sharrow: 
One of the grandaddies of the english snuff market, tracing it's foundation to 1737. They also produce the illustrious Friboug & Treyer range of snuff, which was once sold from it's famous regency premises in the Haymarket London right up to the 1980's. Snuffers are grateful to manufacturers like Wilsons who carried on regardless through good times and bad.


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