Cigarettes are the leading cause of preventable death in the U.S. Almost twice as many Americans die from smoking-related illnesses – nearly half a million – than from obesity, alcohol, automobiles, and guns combined. The accelerating decline in cigarette consumption reinforces JUUL Labs’ mission to improve the lives of the world’s one billion adult smokers by eliminating cigarettes.
The latest U.S. syndicated market data tracking cigarette sales are showing sustained declines while JUUL continues to gain share of the combined cigarette pack and JUULpod market. In the past two Nielsen four-week periods, cigarette volumes have faced year-over-year declines of 8 percent or more — numbers not seen in the past 4 years based on available data. These unprecedented declines are a continuation of the disruption the industry has faced since the second half of 2018, where the cigarette market faced consistent volume declines averaging more than 5 percent. The impact of this disruption is significant, as even a 1 percent annual decline in cigarette volumes represents approximately 125 million packs of combustible cigarettes disappearing from the U.S. market.
These changes in the U.S. tobacco market are a testament to the success of JUUL products in switching adult smokers off combustible cigarettes.”
Kevin Burns, JUUL Labs CEO
For the 4-week period ending in late March, year-over-year declines for cigarette pack volumes worsened, falling to 8.8 percent, according to U.S. syndicated market data from Nielsen. This was the second consecutive month featuring year-over-year cigarette pack volume declines of 8 percent or more. JUUL’s share of the combined cigarette market and JUULpod market increased to 6.5 percent in the 4-week period ending March 23.
These historic gains for JUUL within the cigarette market have occurred rapidly, as cigarette volume declines rested at under 2.9 percent in May 2018, while JUUL’s share of the combined cigarette and JUULpod market was only 3.3 percent.
Multiple factors have driven the long-term trend in cigarette declines, but we believe the largest recent contributor, particularly over the past 12 months, has been the growth of JUUL products as a true alternative for smokers.
In total, JUULpod volume increased by 424 million pods over the past 12 months as compared to the previous twelve months, while the decline in cigarette pack volume exceeded 597 million cigarette packs over the same time frame.
In markets where JUUL products have high market penetration, cigarette volume declines are even more pronounced. In JUUL Labs’ top five syndicated markets as measured by Nielsen — NYC, Portland, Oklahoma City and Tulsa, Seattle, Denver – declines accelerated on a trailing 12-week basis from down year-over-year 3.8 percent one year ago to down 9.9 percent year-over-year in the latest period.
More broadly, the data from Nielsen appear to suggest a negative correlation between JUUL products and cigarette pack volumes. In the top 25 U.S. cities measured by Nielsen, as sales of JUUL products increased, combustible cigarette sales plummeted.
In addition to Nielsen, syndicated market data provider IRI is showing nearly identical volume declines for the cigarette market and gains for JUUL. For the 4-week period ending March 24, cigarette pack volumes declined 8.7 percent year-over-year, according to IRI, while JUUL’s share of the combined cigarette market and JUULpod market held steady at 5.7 percent.
These data are an encouraging trend and is why JUUL Labs will continue to tirelessly work to improve the lives of the world’s one billion adult smokers.
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