Cigarettes: Where there is smoke, there is profit. But for how much longer?
Cigarettes still contribute heavily to c-store revenues, but the segment is facing significant pressures from regulation and changing consumer lifestyles, says IRI.
"Cigarettes generated more than $52bn in sales in the c-store channel in 2012. In fact, cigarettes are, by far, the largest category within the channel. Cigarettes are also a key driver of trip missions. However, volume sales are down sharply."
Meanwhile, the smoking rate has declined 50% since 1965, it notes, although c-stores are seeing new opportunities in smokeless tobacco and electronic cigarettes.
However, the longer-term implications are clear: C-store operators are going to have to find other things to drive trips to their stores.
