Cost Comparison and Spending on Tobacco Products: Evidence from A Nationally Representative Sample of Adult E-Cigarette Users

Background

Over 20 states and local jurisdictions in the U.S. have imposed e-cigarette taxes. It is important to evaluate how adult vapers, including those who also smoke respond to e-cigarette taxation. The purpose of this study is to examine factors associated with adult vapers' cost perception of e-cigarettes relative to cigarettes and budget allocations between two products.

Methods

We recruited a nationally representative sample of 801 adult e-cigarette users in the U.S., who participated in an online survey in April and May 2023. Nested-ordered logit models and ordinary least squares regressions were used in the analysis.

Results

On average, monthly e-cigarette spending was $82.22, and cigarette spending was $118.77 among dual users. Less frequent e-cigarette use and higher state-level e-cigarette taxes were associated with perceiving smoking as cheaper than vaping. Age and exclusive use of tank systems were associated with perceiving vaping as cheaper than smoking. Exclusive use of tank systems was also associated with lower e-cigarette spending. Adults who used e-cigarettes more frequently preferred to report weekly budget on e-cigarettes ( p < 0.01), and among dual users, everyday smokers preferred to report weekly (versus monthly) budget on cigarettes compared to someday smokers ( p < 0.001).

Conclusion

Among US adult vapers, frequencies of tobacco use and e-cigarette device type are closely related to cost measures; and e-cigarette taxes are associated with cost perception of e-cigarettes relative to cigarettes, suggesting potential financial disincentive for vaping. Policymaker may consider imposing differential taxes by e-cigarette product types due to their different costs to consumers.

Going 'Super Value' in New Zealand: cigarette pricing strategies during a period of sustained annual excise tax increases

BACKGROUND

Between 2010 and 2020, the New Zealand (NZ) Government increased tobacco excise tax by inflation plus 10% each year. We reviewed market structure changes and examined whether NZ tobacco companies shifted excise tax increases to maintain the affordability of lower priced cigarette brands.

METHODS

We cluster-analysed market data that tobacco companies supply to the NZ Ministry of Health, created four price partitions and examined the size and share of these over time. For each partition, we analysed cigarette brand numbers and market share, calculated the volume-weighted real stick price for each year and compared this price across different price partitions. We calculated the net real retail price (price before tax) for each price partition and compared these prices before and after plain packaging took effect.

RESULTS

The number and market share of Super Value and Budget brands increased, while those of Everyday and Premium brands decreased. Differences between the price of Premium and Super Value brands increased, as did the net retail price difference for these partitions. Following plain packaging's implementation, Super Value brand numbers more than doubled; contrary to industry predictions, the price difference between these and higher priced brands did not narrow.

CONCLUSIONS

Between 2010 and 2020, NZ tobacco companies introduced more Super Value cigarette brands and shifted excise tax increases to reduce the impact these had on low-priced brands. Setting a minimum retail price for cigarettes could curtail tobacco companies' ability to undermine tobacco taxation policies designed to reduce smoking.

Follow the money: a closer look at US tobacco industry marketing expenditures

INTRODUCTION

While much of the concern with tobacco industry marketing has focused on direct media advertising, a less explored form of marketing strategy is to discount prices. Price discounting is important because it keeps the purchase price low and can undermine the impact of tax increases.

METHODS

We examine annual US marketing expenditures from 1975 to 2019 by the largest cigarette and smokeless tobacco companies as reported to the Federal Trade Commission. We consider three categories: direct advertising, promotional allowances and price discounting. In addition to considering trends in these expenditures, we examine how price discounting expenditures relate to changes in product prices and excise taxes.

RESULTS

US direct advertising expenditures for cigarettes fell from 80% of total industry marketing expenditures in 1975 to less than 3% in 2019, while falling from 39% in 1985 to 6% in 2019 for smokeless tobacco. Price discounting expenditures for cigarettes became prominent after the Master Settlement Agreement and related tax increases in 2002. By 2019, 87% of cigarette marketing expenditures were for price discounts and 7% for promotional allowances. Smokeless marketing expenditures were similar: 72% for price promotions and 13% for promotional allowances. Price discounting increased with prices and taxes until reaching their currently high levels.

CONCLUSIONS

Between 1975 and 2019, direct advertising dramatically fell while price discounting and promotional expenditures increased. Local, state and federal policies are needed that apply non-tax mechanisms to increase tobacco prices and restrict industry contracts to offset industry marketing strategies. Further study is needed to better understand industry decisions about marketing expenditures.

Relapse to problem drinking or trading up to spirits? Using U.S. national cross-sectional survey data to highlight possible negative impacts of potential tobacco retail changes

BACKGROUND

According to the National Alcohol Beverage Control Association, twelve states in the United States (U.S.) have government retail monopolies on spirits/liquor sales. With a new federal minimum legal sales age for tobacco (raised from 18 to 21, the minimum legal sales age for alcohol), we examine possible unintended consequences of a hypothetical policy change restricting retail tobacco sales to state-run spirits/liquor stores in alcohol control states, which has been proposed as a tobacco endgame strategy.

METHODS

We used cross-sectional survey data from 14,821 randomly-selected adults ages 21 and older who responded to the 2015 or 2020 U.S. National Alcohol Survey (51.8% female; 65.8% identified as non-Hispanic White, 12.4% as Black or African American, 14.2% as Hispanic or Latinx; 34.0% had a low level of education), including 2,274 respondents (18.9%) residing in one of the alcohol control states (representing 42.2 million (M) adults ages 21+). We estimated associations between tobacco measures (lifetime smoking status, lifetime daily smoking, past-year daily smoking) and alcohol measures (drinking status, beverage choices, lifetime alcohol use disorder (AUD) status, recovery status) overall and for specific subgroups.

RESULTS

In control states, 55.1% of people who smoked daily in the past year also reported lifetime AUD, including an estimated 3.56 M adults ages 21 + who reported prior (but not current) AUD. The association of daily smoking with lifetime AUD was stronger among those with low education compared to those with higher education. Further, 58.8% of people in recovery from an alcohol and/or drug problem (1.49 M adults ages 21+) smoked daily, and this was more marked among women than men in control states.

CONCLUSION

There could be negative consequences of an endgame strategy to restructure tobacco retail sales, including increased risk for relapse to drinking among people who smoke daily, especially among women and people with low levels of education. Strategies to mitigate unintended harms would be needed if such a policy were implemented.

Understanding the Impact of COVID-19 on Tobacco and Nicotine Use among Young Adults Identified as Sexual and Gender Minorities: A Mixed Methods Approach

We investigated the perceived impact of COVID-19 on changes in tobacco and nicotine (NT) use among sexual and gender minority (SGM) young adults. We used a mixed methods approach that included closed- and open-ended survey questions and in-depth interviews. Participants were 53 SGM young adults in California who reported current or past cigarette smoking. Of study participants, 63% (n=33) reported any changes in their NT use, and of those, 60% reported initial increase of NT use. Content analysis of an open-ended survey question revealed three reported reasons for changes in NT use: (1) changes in routine activities (27%), (2) stress (46%), and (3) health (24%). Thematic analysis of qualitative interviews identified several related themes: (1) in discussions of increased NT use, stress and boredom/free time were important aspects of changes to daily routines, (2) fluctuations in NT use behaviors occurred over time, (3) reasons for NT changes were multiple and intertwined, and (4) NT use changes were shaped by experiences related to intersectional forms of structural and social stigmatization. Results reveal the dynamic and complex ways in which participants described their pandemic-related changes in NT use-nuance that is crucial for compassionate and participant-centered approaches to tobacco prevention and cessation.

Sugar-Sweetened Beverage Pricing Policies: Simulation of Minimum Price Laws and Taxes in New York City

INTRODUCTION

Minimum price laws, which set a price below which a product cannot be sold, are a promising but understudied strategy for reducing the consumption of sugar-sweetened beverages. New York City has implemented a minimum price law for tobacco products and could consider this policy for sugar-sweetened beverages. This study projects the impacts of a sugar-sweetened beverage minimum price law among New York City adults, with effects of a sugar-sweetened beverage excise tax examined for comparison.

METHODS

In 2020-2021, a microsimulation model of dietary behaviors and body weight was developed using population-based survey data, research on responsiveness to and avoidance of price increases, and a validated weight change model. Analyses applied the model to simulate the impacts of implementing a minimum price law (8 or 10 cents/ounce price floors) or an excise tax (1 or 2 cents/ounce tax rates) on diet and body weight among New York City adults for more than 5 years. Sensitivity analyses varied assumptions about price responsiveness, caloric compensation, and avoidance.

RESULTS

A sugar-sweetened beverage minimum price law with an 8 cents/ounce floor would reduce average sugar-sweetened beverage intake by 16.5 calories/day (95% uncertainty interval= -17.2, -15.8) and obesity prevalence by 0.86 percentage points (95% uncertainty interval= -1.03, -0.69). Benefits were similar for a minimum price law with a 10 cents/ounce floor and for 1 and 2 cents/ounce taxes (range of obesity reductions: -0.84 to -1.24 percentage points). Benefits persisted in sensitivity analyses and were larger for Black and Hispanic than for White and Asian adults and for adults with lower than for those with higher income.

CONCLUSIONS

Excise taxes and minimum price laws for sugar-sweetened beverages could both reduce New York City adults' sugar-sweetened beverage consumption and obesity prevalence and narrow sociodemographic disparities in obesity.

Where to next for countries with high tobacco taxes? The potential for greater control of tobacco pricing through licensing regulation

Optimising the taxation of tobacco products should be among the highest priorities for health and hence economic policy in every country. The WHO Technical Manual on Tobacco Tax Policy and Administration released in April 2021 provides invaluable advice, including 26 best practice recommendations on policy design, administrative efficiency and addressing industry tactics to circumvent tobacco tax increases. Introducing and increasing tobacco taxes is the most important tobacco control measure for any jurisdiction. The effects of simple tax structures, high tax levels, and frequent above-inflation increases in specific excise duties can be enhanced through strict controls on packaging (including pack size), product design, and discounting. However, even with such measures, tobacco companies can continue to undermine the effectiveness of tax policy by offering some products in their ranges at very low prices, as well as gradually and selectively increasing the prices of some but not all products after tax increases. This paper is aimed at policymakers in countries that have already adopted best practice tax policy. It explores the idea of wholesale price capping combined with retail licensing to address the problems of brand proliferation, dispersion of prices, cushioning and strategic under/overshifting of tax increases, thereby radically and sustainably increasing the effectiveness of tobacco tax policy while also raising additional tax revenue for governments by reducing industry profitability.

Cheaper tobacco product prices at US Air Force Bases compared with surrounding community areas, 2019

INTRODUCTION

In March 2017, the US Department of Defense (DoD) implemented a policy requiring all military stores to set tobacco prices equal to 'prevailing prices' in the 'local community' adjusted for state and local taxes. We compared tobacco product prices in a sample of retailers located on five Air Force Bases (AFBs) in Texas and Mississippi with those sold in nearby off-base stores.

METHODS

We constructed a list of on-base and off-base tobacco retailers. Off-base retailers included stores that were located within a 1.5-mile road network service area from main AFB gates. Between July and September 2019, a trained auditor visited 23 on-base and 50 off-base retailers to confirm tobacco product sales, and documented the price of cigarettes and Copenhagen smokeless tobacco. For each area, the median price for each product, as well as the difference in median prices by on-base versus off-base status, was calculated.

RESULTS

The median price of cigarettes and smokeless products was cheaper at on-base retailers. All products were cheaper at on-base stores in Fort Sam Houston and Lackland AFB. Similarly, all products were cheaper in on-base stores at Keesler AFB, with the exception of Marlboro Red packs ($0.22 more), and at Sheppard AFB with the exception of cheapest cigarette cartons ($6.26 more).

CONCLUSION

Despite the implementation of the new DoD policy, tobacco products are cheaper in on-base retailers compared with off-base retailers. Refining of the definitions used and improved compliance with the new DoD policy are needed.

Boosting the Tobacco Control Vaccine: recognizing the role of the retail environment in addressing tobacco use and disparities

Much of the progress in reducing cigarette smoking and tobacco-related morbidity and mortality among youth and adults is attributable to population-level strategies previously described in the context of the Tobacco Control Vaccine. The retail environment is used heavily by the tobacco industry to promote and advertise its products, and variations in exposure to and characteristics of the retail environment exist across demographic groups. It is therefore also an essential environment for further reducing smoking, as well as ameliorating racial, ethnic and socioeconomic tobacco-related disparities. This commentary provides an overview of the importance of incorporating strategies focused on the tobacco retailer environment (availability; pricing and promotion; advertising and display; age of sale; and retail licensure) as part of a comprehensive approach to tobacco prevention and control. To reach tobacco endgame targets, such innovative strategies are a complement to, but not a replacement for, long-standing evidence-based components of the Tobacco Control Vaccine.

Effects of a minimum floor Price law on cigarette use in Oakland, California: A static microsimulation model

Tobacco minimum floor price laws (MFPLs) are a non-tax price policy that set a price below which tobacco products cannot be sold, thereby raising prices. Despite their growing interest among policy makers, little is known about the effects of local MFPLs on smoking prevalence or smoking intensity. We aimed to project the impact of a local tobacco MFPL on cigarette smoking prevalence and cigarette smoking intensity in Oakland, California, including detailed analysis of several important subpopulations. We used data collected between April 2017 and December 2019 from the California Behavioral Risk Factor Surveillance System and the National Youth Tobacco Survey to construct a static microsimulation model representative of Oakland. We projected the impact of MFPLs ranging from $8.00 to $13.00 per pack. All analyses were conducted between 2019 and 2020. With the introduction of an MFPL and assuming 15% policy evasion, mean price paid per pack was projected to increase by $1.05 to $4.69, cigarette smoking prevalence was projected to drop by 0.3% to 0.8%, and smoking intensity was projected to drop by 0.7% to 2.0% among continuing smokers. Total number of cigarettes smoked per month was projected to drop by 246,000 to 734,000 cigarettes, a 3.0% to 9.0% reduction from the current level (8.2 million cigarettes). The greatest reductions in cigarette smoking prevalence were among those aged 12 to 24-years-old, of non-Hispanic black or other race/ethnicity, and living below the federal poverty level. An MFPL in Oakland may substantially reduce cigarette use and target several important subpopulations.