Andrew Romeo is a long-time veteren of the snus and associated industries. A New York native, Andy has worked throughout Europe and is currently building distribution networks in Russia.
I was just reading an article in the NY Times from this past week, that HULU, a fairly new video-streaming company with high-falutin' investors like ABC/Disney, can't decide if they have 9 million viewers or 42 million viewers watching network shows on their website.
Nielsen, the ubiquitous research agency, says 9mm. Hulu doesn't like it. Advertisers are steering clear because Nielsen is a trusted name. A brand, if you will. They have other research agencies, too.
It's difficult being in Big Tobacco and running its snus business in Nordic Europe. It's even more difficult if you are in Small Tobacco, and don't have a cigarette business to bring in the cash while your snus factory loses money annually.
At last count, there are under 10 tobacco companies in Sweden manufacturing snus. There is at least one in Denmark (V2).
Scandinavia sells 220 million cans of snus per year, 200 of which go through the Swedish market + duty free (and leak over to Finland), and 20m which are purchased in Norway. Until the Swedish government changed, and levied a 100% excise tax increase in 2006, and another 50% increase in 2007, snus was growing at 10% per year in volume terms. It's now stable, after a quick volume drop. Norway was increasing excise regularly, and up to 35% of Norwegian consumption now comes from Swedish border shops.
THE SWEDISH MARKET
In Sweden, Big (and small) Tobacco sell snus (and smokes) into 9000 shops, including many independents, organized convenience outlets (7-11, Pressbyran (Reitan)), and organized grocery (ICA, COOP, Axfood). 98% of all tobacco products are delivered by Swedish Match Distribution, a nearly flawless distribution company with roots in the old monopoly. Swedish Match AB also has 87% market share in snus, so the other producers have all had those 'prickly' moments of being locked in the Death Star's tractor beam when they signed with SMD for snus distribution.
This was not intended to be my first article, but as someone who ran Gallaher Sweden for two years (2005-06), I can offer up some perspective on Swedish CAMEL Snus, and most likely do so without pissing anyone off.
Gallaher was the sales agent for JTI at the time, and sold CAMEL cigarette products in Sweden as part of its local portfolio. JTI had always had an interest in snus, and I would often joke about the ‘first order for CAMEL snus’ when their guys would visit from Geneva. The market was growing at almost 10% per year at the time, and the factory had capacity.
The EU snus ban is an "Animal Farm" type of idiocy which languishes in the "WTF" category permanently. Snus is nearly harmless. 16% of Swedes use it, and they all live to be 100 years old. The endless debates among Brussels, Karolinska, and Swedish Match are tiresome, and BAT, JTI, and PMI now all have snus through recent acquisitions. What's the 'political' reason? People used to say PMI, but they're now in it. Big Pharma? Possibly.
How about lack of interest?
I used to work for Big Tobacco in Sweden, among other places. Snus had its 15 minutes internationally a few years ago, but frankly, European tobacco consumers by and large have no idea what it is, and if it showed up in shops, would either not see it (due to local display/ad bans) or ignore it.
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