Vape Talk | JTI not yet joining the disposable vaping race, will explore the nicotine pouch market

Regarding the currently popular disposable e-cigarette products, Japan Tobacco International (JTI) clearly stated in an interview that they have not yet invested resources to compete in the sales of these products, as this emerging niche market faces multiple challenges.

[2FIRSTS Original] Japan Tobacco (JT) released a report on October 31, showing that its total revenue for the first three quarters of 2023 increased by 7.4% year-on-year to 2.157 trillion yen (approximately 14.3 billion USD), and net profit grew by 9.5% year-on-year to 442 billion yen (approximately 2.9 billion USD).

Masamichi Terabatake, President and CEO of Japan Tobacco, stated that despite the intense competitive market environment, the company's tobacco business continues to maintain substantial growth driven by stable market share growth and strong pricing.

Terabatake admitted that in order to establish a foundation for future growth, the company is accelerating its investment in heated tobacco products. Despite the competitive market environment, their product Ploom X has already captured over 10% of the heated tobacco market share in Japan and has shown stable growth from July to September 2023.

Recently, 2FIRSTS conducted an exclusive interview with Japan Tobacco International (JTI) to gain deeper insights into the company's layout in the new tobacco sector.

In the interview, JTI announced that its latest product, WITH2, has been launched in the Japanese market. At the same time, they plan to expand the global market share of the heat-not-burn product Ploom X, expecting to further expand to 28 countries by the end of 2024.

However, regarding the currently popular disposable e-cigarette products, JTI clearly stated that they have not yet invested resources to compete in the sales of these products, as this emerging niche market faces multiple challenges.

Additionally, JTI revealed that they plan to invest up to 300 billion yen (approximately 2 billion USD) in harm reduction products from 2023 to 2025, with a focus on heated tobacco products. They also plan to invest in R&D for niche markets such as heated tobacco and nicotine pouches.

Here is the dialogue content:

2FIRSTS: Is WITH2 already on sale in the Japanese market? How is it performing? 

JTI: In August 2023, JT launched the new injection tobacco vaporizer WITH 2 under its new brand WITH. WITH uses JT's exclusive patented injection technology, is compact and portable, and is easy to operate, providing adult users with a superior sensory experience. WITH2 is designed for social compatibility to meet the needs of different users. 

As of now, the WITH product is only sold in the Japanese market. Online sales began on August 7, 2023, and sales channels expanded to offline stores in early September 2023.

Given that WITH 2 has just been released, detailed information about product performance may still be in the early stages of release, and further news and reviews are awaited. 

2FIRSTS: Can you introduce JTI's new tobacco product lineup? How is the Ploom series performing globally? 

JTI: Reduced-risk products (RRP) represent the potential to reduce smoking-related risks and are a key step in our ongoing development and future direction. We are continuously expanding our range of smoke-free alternatives, including Ploom X - heated tobacco products, WITH - injection tobacco products, Logic - electronic vapor or e-cigarette products, and Nordic Spirit - nicotine pouches or oral nicotine products. This diversified product lineup aims to provide consumers with safer choices and help reduce smoking-related risks.

Ploom X is JTI Group's latest and most advanced heated tobacco stick device, which first debuted in the Japanese market in August 2021. By the end of 2024, Ploom X is expected to further expand to 28 countries, with plans to cover more regions by 2025.

As of the second quarter of 2023, JTI's market share in the heated tobacco sector in Japan has increased to 9.5%. Our global user base continues to grow, now exceeding 1 million users, a year-on-year increase of approximately 45%. This strong growth trend demonstrates JTI Group's outstanding performance in the heated tobacco sector. 

2FIRSTS: How does JTI view the rapid growth of disposable e-cigarettes and the trend of pod-based products in Europe? 

JTI: We fully recognize the rapid growth of the disposable e-cigarette market; however, we have not yet invested resources to compete in the sales of these products, as this emerging niche market faces multiple challenges. #p#分页标题#e#

2FIRSTS: Has JTI previously launched e-cigarettes? Why hasn't JTI seized the high-growth opportunity to promote e-cigarettes? 

JTI: Our e-cigarette product Logic is currently available in the UK, Ireland, and the US markets. Our business philosophy emphasizes consumer-centricity and prioritizes investment in heated tobacco sticks while not neglecting necessary investments in traditional tobacco. Additionally, we will continue to increase investment in niche markets such as injection tobacco and nicotine pouches. 

2FIRSTS: Does JTI have other R&D investments or plans in the field of reduced-risk tobacco products? If so, is there any data or information that can be disclosed? 

From 2023 to 2025, we will invest up to 300 billion yen in the field of reduced-risk products, with a primary focus on heated tobacco products. We also plan to invest in R&D for niche markets such as injection tobacco and nicotine pouches. A significant portion of this substantial funding will be allocated to ongoing R&D efforts.