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Gendall P, Gendall K, Branston JR, Edwards R, Wilson N, Hoek J. Going 'Super Value' in New Zealand: cigarette pricing strategies during a period of sustained annual excise tax increases. Tob Control 2024; 33:240-246. [PMID: 36008127 DOI: 10.1136/tc-2021-057232] [Citation(s) in RCA: 0] [Impact Index Per Article: 0] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 12/18/2021] [Accepted: 08/09/2022] [Indexed: 11/04/2022]
Abstract
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.
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Affiliation(s)
- Philip Gendall
- Public Health, University of Otago Wellington, Wellington, New Zealand
| | | | | | - Richard Edwards
- Public Health, University of Otago Wellington, Wellington, New Zealand
| | - Nick Wilson
- Public Health, University of Otago Wellington, Wellington, New Zealand
| | - Janet Hoek
- Public Health, University of Otago Wellington, Wellington, New Zealand
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Bayly M, Scollo M, Wakefield MA. Evidence of cushioning of tobacco tax increases in large retailers in Australia. Tob Control 2022; 31:671-674. [PMID: 34117099 PMCID: PMC9411903 DOI: 10.1136/tobaccocontrol-2020-056385] [Citation(s) in RCA: 2] [Impact Index Per Article: 1.0] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Download PDF] [Journal Information] [Subscribe] [Scholar Register] [Received: 11/24/2020] [Revised: 03/15/2021] [Accepted: 03/18/2021] [Indexed: 11/05/2022]
Abstract
BACKGROUND Tobacco companies may attempt to minimise the impact of tobacco tax increases on consumers by gradually passing on the price rise over several months. This study examined whether there was evidence of large Australian tobacco retailers engaging in this practice (known as cushioning) over a period including both routine indexation and large annual tobacco excise increases. METHODS Advertised prices of nine factory-made cigarette (FMC) and nine roll-your-own tobacco (RYO) products were recorded from two stores monthly from December 2016 to December 2019. Per cent change in price from the previous month was analysed for FMC and RYO products, controlling for year, month, tobacco company and supermarket chain. RESULTS Significant main effects of month were observed for FMC and RYO products (both p<0.001). Large, significant average increases in per cent change in price were observed in September for FMC (6.51%) and RYO (11.45%) products, the month of the annual excise increase and prices also significantly increased in October (FMC: 3.01%; RYO: 1.91%). Significant increases were also observed in the months after the March annual routine indexation: by 1.10% in May for FMC products and by 1.09% in April for RYO products. CONCLUSION This study has demonstrated evidence of cushioning of tax increases of FMC and RYO products in large Australian supermarkets. The monthly per cent change in price significantly increased several months after routine excise indexation and in the 2 months following a large annual excise increase. Further research with a larger sample of products and stores is needed to confirm these findings.
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Affiliation(s)
- Megan Bayly
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Victoria, Australia
| | - Michelle Scollo
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Victoria, Australia
- Prevention Division, Cancer Council Victoria, Melbourne, Victoria, Australia
| | - Melanie A Wakefield
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Victoria, Australia
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Moodie C, Hoek J, Hammond D, Gallopel-Morvan K, Sendoya D, Rosen L, Mucan Özcan B, van der Eijk Y. Plain tobacco packaging: progress, challenges, learning and opportunities. Tob Control 2022; 31:263-271. [PMID: 35241599 DOI: 10.1136/tobaccocontrol-2021-056559] [Citation(s) in RCA: 15] [Impact Index Per Article: 7.5] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 06/30/2021] [Accepted: 10/12/2021] [Indexed: 11/03/2022]
Abstract
The aim of this paper is to overview progress made with respect to the adoption of plain (or standardised) packaging, key challenges faced, evaluative evidence and opportunities for extending this policy. It has been a decade since Australia became the first country to require tobacco products to be sold in plain packaging; after slow initial uptake, 16 countries have now fully implemented this policy. Since 2020, plain packaging laws have become more comprehensive in some countries, expanding coverage beyond traditional tobacco products to include heated tobacco, tobacco accessories (rolling papers) and other nicotine-containing products (e-cigarettes). Laws have also become more innovative: some now ban non-biodegradable filters, include provision for a periodic change of the pack colour or require both plain packaging and health-promoting pack inserts. The tobacco industry has and will continue to use multi-jurisdictional strategies to oppose this policy. Evaluations suggest that plain packaging has improved health outcomes and has not burdened retailers, although research is limited to early policy adopters and important gaps in the literature remain. While the power of packaging as a sales tool has diminished in markets with plain packaging, tobacco companies have exploited loopholes to continue to promote their products and have increasingly focused on filter innovations. Opportunities exist for governments to strengthen plain packaging laws.
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Affiliation(s)
- Crawford Moodie
- Institute for Social Marketing and Health, University of Stirling, Stirling, UK
| | - Janet Hoek
- Departments of Public Health and Marketing, University of Otago, Dunedin, New Zealand
| | - David Hammond
- School of Public Health and Health Systems, University of Waterloo, Waterloo, Ontario, Canada
| | | | - Diego Sendoya
- Facultad de Derecho, Universidad de la Republica Uruguay, Montevideo, Uruguay
| | - Laura Rosen
- Department of Health Promotion, School of Public Health, Tel Aviv University Sackler Faculty of Medicine, Tel Aviv, Israel
| | - Burcu Mucan Özcan
- Department of Business Administration, Celal Bayar University, Manisa, Turkey
| | - Yvette van der Eijk
- Saw Swee Hock School of Public Health, National University of Singapore, Singapore
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Hiscock R, Augustin NH, Branston JR, Gilmore AB. Standardised packaging, minimum excise tax, and RYO focussed tax rise implications for UK tobacco pricing. PLoS One 2020; 15:e0228069. [PMID: 32053603 PMCID: PMC7017998 DOI: 10.1371/journal.pone.0228069] [Citation(s) in RCA: 14] [Impact Index Per Article: 3.5] [Reference Citation Analysis] [Abstract] [MESH Headings] [Grants] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Subscribe] [Scholar Register] [Received: 05/14/2019] [Accepted: 01/07/2020] [Indexed: 01/10/2023] Open
Abstract
BACKGROUND Standardised packaging for factory made (FM) and roll your own (RYO) tobacco was fully implemented in the UK in May 2017. Around the same time, several changes to the tax system were applied (a Minimum Excise Tax (MET) for FM products and tax increases weighted towards RYO products). The tobacco industry claims that standardised packaging will lower prices (a disincentive for quitting) by commoditising the product, yet had itself taken advantage of the previous tax regime to achieve large profits from premium brands while also keeping some products' prices relatively low. Here we evaluate the impact of standardised packaging, the MET and the RYO focussed tax changes on price and industry profitability. METHODS AND FINDINGS Nielsen electronic point of sale (EPOS) data (May 2015 to April 2018) were used to calculate real (inflation adjusted) monthly price per stick overall, by cigarette type (FM and RYO) and by seven market segments. Trend estimation, using additive mixed models, assessed weighted average price (weighted by volume of sales) and tobacco industry net revenue changes. The beginning and end of the data series were compared in terms of: (a) average monthly price growth, (b) average monthly net revenue growth, and (c) undershifting and overshifting patterns after tax changes. FM and RYO real prices changed little over the 3-year period-overall prices rose by about 1p per stick. There was no evidence of commoditisation with prices of all FM segments (but not RYO) rising faster after the implementation of standardised packaging than immediately beforehand. The prices of the cheapest FM brands rose with the implementation of the MET. RYO price increases did not close the gap to FM pricing levels despite RYO focussed tax increases. Tax changes following the implementation of standardised packaging and the MET were more widely and quickly passed on to smokers in the form of higher prices than the tax change pre-implementation. The main limitations are first that because we do not know the exact mechanism by which Nielsen scales up sample data to provide UK estimates, we could only use data for a set three year period during which the same adjustments are made. Second, the tax and standardised packaging events were sometimes too close in time to separate their consequences statistically. Third, tobacco prices may also be affected by external factors such as changes in smokers' disposable income or availability of electronic nicotine delivery systems. CONCLUSIONS There was no long-term lowering of tobacco prices after the implementation of standardised packaging as predicted by the industry. The introduction of the MET was successful in increasing the price of the cheapest FM cigarettes and narrowing the price gap between FM brands. The RYO tax increases were, however, insufficient to narrow the price gap between RYO and FM. Overall, undershifting became less extensive indicating that tobacco industry manipulation of the tax system which had previously kept cheap products available had declined. This suggests that standardised packaging and a MET will likely contribute to further declines in UK tobacco use.
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Affiliation(s)
- Rosemary Hiscock
- Tobacco Control Research Group, Department for Health, University of Bath, Bath, England, United Kingdom
| | - Nicole H. Augustin
- Department of Mathematical Sciences, University of Bath, Bath, England, United Kingdom
| | | | - Anna B. Gilmore
- Tobacco Control Research Group, Department for Health, University of Bath, Bath, England, United Kingdom
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Purves RI, Moodie C, Eadie D, Stead M. The Response of Retailers in Scotland to the Standardised Packaging of Tobacco Products Regulations and Tobacco Products Directive. Nicotine Tob Res 2019; 21:309-313. [PMID: 30202853 PMCID: PMC6379025 DOI: 10.1093/ntr/nty181] [Citation(s) in RCA: 8] [Impact Index Per Article: 1.6] [Reference Citation Analysis] [Abstract] [Track Full Text] [Download PDF] [Journal Information] [Subscribe] [Scholar Register] [Received: 02/09/2018] [Accepted: 09/05/2018] [Indexed: 11/12/2022]
Abstract
INTRODUCTION With most marketing channels prohibited, the retail environment has assumed greater importance for tobacco companies, even in markets with a ban on the open display of tobacco products. Research has yet to qualitatively explore how retailers respond to standardized packaging in a country where this has been introduced. METHODS As part of the DISPLAY study, face-to-face interviews were conducted with 24 small retailers in Scotland between May 23 and June 26, 2017; the interviews were conducted after The Standardised Packaging of Tobacco Products Regulations and the Tobacco Products Directive were fully implemented. RESULTS We found high retailer compliance with the legislation. With price-marked packs and packs containing less than 20 cigarettes and 30 g of rolling tobacco banned, retailers stated that this helped simplify ordering and stock management. The removal of price-marked packs also allowed them some flexibility to set their own prices, but many chose to stick closely to recommended retail price in order to remain competitive and avoid complaints from customers. In contrast to one of the tobacco industry's arguments against standardized packaging, most retailers suggested that transaction times had not increased, even though the changes had only recently come into force. CONCLUSIONS This study challenges some of the arguments used against standardized packaging and provides an insight into the storage and pricing strategies adopted by retailers following the removal of price-marked packs. IMPLICATIONS This study explores the response of the retailers to the introduction of standardized tobacco packaging and provides an insight into the storage and pricing strategies adopted by retailers following the removal of price-marked packs. It explores the importance of the retailer in tobacco companies' desire to maintain tobacco sales and challenges some of the arguments used against standardized packaging, such as an increase in transaction times. Countries seeking to introduce standardized packaging should monitor the experiences of retailers, preferably from preimplementation through to post implementation, to help understand how retailers respond to this policy and to inform compliance.
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Affiliation(s)
- Richard I Purves
- Institute for Social Marketing, Faculty of Health Sciences and Sport, University of Stirling, Stirlingshire, Scotland
| | - Crawford Moodie
- Institute for Social Marketing, Faculty of Health Sciences and Sport, University of Stirling, Stirlingshire, Scotland
| | - Douglas Eadie
- Institute for Social Marketing, Faculty of Health Sciences and Sport, University of Stirling, Stirlingshire, Scotland
| | - Martine Stead
- Institute for Social Marketing, Faculty of Health Sciences and Sport, University of Stirling, Stirlingshire, Scotland
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Mills SD, Golden SD, Henriksen L, Kong AY, Queen TL, Ribisl KM. Neighbourhood disparities in the price of the cheapest cigarettes in the USA. J Epidemiol Community Health 2019; 73:894-896. [PMID: 31122944 PMCID: PMC6689253 DOI: 10.1136/jech-2018-210998] [Citation(s) in RCA: 5] [Impact Index Per Article: 1.0] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 05/08/2018] [Revised: 03/22/2019] [Accepted: 05/11/2019] [Indexed: 11/03/2022]
Abstract
BACKGROUND There is evidence that the cheapest cigarettes cost even less in neighbourhoods with higher proportions of youth, racial/ethnic minorities and low-income residents. This study examined the relationship between the price of the cheapest cigarette pack and neighbourhood demographics in a representative sample of tobacco retailers in the USA. METHODS Data collectors recorded the price of the cheapest cigarette pack (regardless of brand) in 2069 retailers in 2015. Multilevel linear modelling examined the relationship between price and store neighbourhood (census tract) characteristics, specifically median household income and percentage of youth, Black, Asian/Pacific Islander and Hispanic residents. RESULTS Average price for the cheapest pack was $5.17 (SD=1.73) and it was discounted in 19.7% of stores. The price was $0.04 less for each SD increase in the percentage of youth and $0.22 less in neighbourhoods with the lowest as compared with the highest median household incomes. Excluding excise taxes, the average price was $2.48 (SD=0.85), and associations with neighbourhood demographics were similar. CONCLUSION The cheapest cigarettes cost significantly less in neighbourhoods with a greater percentage of youth and lower median household income. Non-tax mechanisms to increase price, such as minimum price laws and restrictions on discounts/coupons, may increase cheap cigarette prices.
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Affiliation(s)
- Sarah D Mills
- Lineberger Comprehensive Cancer Center, University of North Carolina, Chapel Hill, North Carolina, USA
| | - Shelley D Golden
- Lineberger Comprehensive Cancer Center, University of North Carolina, Chapel Hill, North Carolina, USA
- Department of Health Behavior, University of North Carolina, Chapel Hill, North Carolina, USA
| | - Lisa Henriksen
- Stanford Prevention Research Center, Stanford University School of Medicine, Stanford, California, USA
| | - Amanda Y Kong
- Department of Health Behavior, University of North Carolina, Chapel Hill, North Carolina, USA
| | - Tara L Queen
- Lineberger Comprehensive Cancer Center, University of North Carolina, Chapel Hill, North Carolina, USA
| | - Kurt M Ribisl
- Lineberger Comprehensive Cancer Center, University of North Carolina, Chapel Hill, North Carolina, USA
- Department of Health Behavior, University of North Carolina, Chapel Hill, North Carolina, USA
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Critchlow N, Stead M, Moodie C, Angus K, Eadie D, MacKintosh AM. Difference between recommended retail price and sales price for tobacco products in independent and convenience (small) retailers before and after the introduction of standardised tobacco packaging in the UK. Tob Control 2019; 28:449-456. [PMID: 30120200 DOI: 10.1136/tobaccocontrol-2018-054409] [Citation(s) in RCA: 3] [Impact Index Per Article: 0.6] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 04/03/2018] [Revised: 07/20/2018] [Accepted: 07/30/2018] [Indexed: 12/21/2022]
Abstract
AIM Recommended retail price (RRP) is a marketing strategy used by tobacco companies to maintain competitiveness, communicate product positioning and drive sales. We explored small retailer adherence to RRP before and after the introduction of the Standardised Packaging of Tobacco Products Regulations in the UK (fully implemented on 20 May 2017) which mandated standardised packaging of cigarettes and rolling tobacco, set minimum pack/pouch sizes and prohibited price-marking. METHOD Monthly electronic point of sale data from 500 small retailers in England, Scotland and Wales were analysed. From May 2016 to October 2017, we monitored 20 of the best-selling fully branded tobacco products (15 factory-made cigarettes, 5 rolling tobacco) and their standardised equivalents. Adherence to RRP was measured as the average difference (%) between monthly RRPs and sales prices by pack type (fully branded vs standardised), price-marking on packaging and price segment. RESULTS The average difference between RRP and sales price increased from +0.36% above RRP (SD=0.72) in May 2016, when only fully branded packs were sold, to +1.37% in October 2017 (SD=0.30), when standardised packs were mandatory. Increases above RRP for fully branded packs increased as they were phased out, with deviation greater for non-price-marked packs and premium products. DISCUSSION Despite tobacco companies emphasising the importance of RRP, small retailers implemented small increases above RRP as standardised packaging was introduced. Consequently, any intended price changes by tobacco companies in response to the legislation (ie, to increase affordability or brand positioning) may be confounded by retailer behaviour, and such deviation may increase consumer price sensitivity.
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Affiliation(s)
- Nathan Critchlow
- Institute for Social Marketing, UK Centre for Tobacco and Alcohol Studies, Faculty of Health Sciences and Sport, University of Stirling, Stirling, UK
| | - Martine Stead
- Institute for Social Marketing, UK Centre for Tobacco and Alcohol Studies, Faculty of Health Sciences and Sport, University of Stirling, Stirling, UK
| | - Crawford Moodie
- Institute for Social Marketing, UK Centre for Tobacco and Alcohol Studies, Faculty of Health Sciences and Sport, University of Stirling, Stirling, UK
- Centre for Tobacco Control Research, Institute for Social Marketing, Faculty of Health Sciences and Sport, University of Stirling, Stirling, UK
| | - Kathryn Angus
- Institute for Social Marketing, UK Centre for Tobacco and Alcohol Studies, Faculty of Health Sciences and Sport, University of Stirling, Stirling, UK
| | - Douglas Eadie
- Institute for Social Marketing, UK Centre for Tobacco and Alcohol Studies, Faculty of Health Sciences and Sport, University of Stirling, Stirling, UK
| | - Anne-Marie MacKintosh
- Institute for Social Marketing, UK Centre for Tobacco and Alcohol Studies, Faculty of Health Sciences and Sport, University of Stirling, Stirling, UK
- Centre for Tobacco Control Research, Institute for Social Marketing, Faculty of Health Sciences and Sport, University of Stirling, Stirling, UK
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Critchlow N, Stead M, Moodie C, Angus K, Eadie D, MacKintosh AM. Pricing of tobacco products during, and after, the introduction of standardized packaging: an observational study of retail price data from independent and convenience (small) retailers in the United Kingdom. Addiction 2019; 114:523-533. [PMID: 30554446 PMCID: PMC6491979 DOI: 10.1111/add.14488] [Citation(s) in RCA: 4] [Impact Index Per Article: 0.8] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Received: 04/22/2018] [Revised: 06/28/2018] [Accepted: 10/29/2018] [Indexed: 11/29/2022]
Abstract
BACKGROUND AND AIMS Tobacco companies claimed that standardized packaging, phased in/introduced May 2016-May 2017, would reduce prices and increase consumption. We: (1) describe changes in price-per-cigarette and price-per-gram during, and after, the introduction of standardized packaging; (2) describe price changes by cigarette price segment; and (3) analyse price changes by stage of implementation. DESIGN An observational study, using electronic point-of-sale data, monitored price trends in three periods: (1) May-September 2016, start of transition period; (2) October 2016-May 2017, when fully branded and standardized products were sold and duty escalators implemented; and (3) June-October 2017, when standardized packaging was mandatory. SETTING United Kingdom. PARTICIPANTS Small retailers (n = 500) stratified by region and deprivation. Data were monitored for 20 leading fully branded tobacco products [15 factory-made cigarettes (FMC), 5 roll-your-own (RYO)] and their standardized equivalents. MEASUREMENT Price-per-cigarette and price-per-gram, based on monthly average Recommended Retail Price (RRP) and actual sale price, adjusted for inflation using the Consumer Pricing Index (CPIH). Net changes (£GBP, %) were analysed by product type (FMC versus RYO) and FMC price segment (value, mid-price, premium). FINDINGS Between May 2016 and October 2017, the average inflation-adjusted RRP/price-per-cigarette and price-per-gram increased for FMC (all price segments) and RYO. For example, sales price-per-cigarette increased +4.64%, with the largest increases for value (+6.81%), premium (+5.32%) and mid-price FMCs (+3.30%). Net sales price-per-cigarette and price-per-gram increases were largest in period 2, when fully branded and standardized products were sold and duty escalators were implemented (FMC = +4.70%; RYO = +3.75%). There were small decreases in sales price-per-cigarette and price-per-gram once standardized packaging became mandatory (FMC = -1.14%; RYO = -0.88%). CONCLUSION In the United Kingdom, the price of leading roll-your-own and factory-made cigarette brands sold by small retailers increased as standardized packaging was phased in, with increases larger than expected through duty escalation.
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Affiliation(s)
- Nathan Critchlow
- Institute for Social Marketing, and UK Centre for Tobacco and Alcohol Studies, Faculty of Health Sciences and Sport, University of StirlingScotland, UK
| | - Martine Stead
- Institute for Social Marketing, and UK Centre for Tobacco and Alcohol Studies, Faculty of Health Sciences and Sport, University of StirlingScotland, UK
| | - Crawford Moodie
- Institute for Social Marketing, and UK Centre for Tobacco and Alcohol Studies, Faculty of Health Sciences and Sport, University of StirlingScotland, UK
- Centre for Tobacco Control Research, Faculty of Health Sciences and SportUniversity of StirlingScotland, UK
| | - Kathryn Angus
- Institute for Social Marketing, and UK Centre for Tobacco and Alcohol Studies, Faculty of Health Sciences and Sport, University of StirlingScotland, UK
| | - Douglas Eadie
- Institute for Social Marketing, and UK Centre for Tobacco and Alcohol Studies, Faculty of Health Sciences and Sport, University of StirlingScotland, UK
| | - Anne Marie MacKintosh
- Institute for Social Marketing, and UK Centre for Tobacco and Alcohol Studies, Faculty of Health Sciences and Sport, University of StirlingScotland, UK
- Centre for Tobacco Control Research, Faculty of Health Sciences and SportUniversity of StirlingScotland, UK
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Egger S, Burton S, Ireland R, Walsberger SC. Observed retail price of Australia's market-leading cigarette brand before and up to 3 years after the implementation of plain packaging. Tob Control 2018; 28:e86-e91. [PMID: 30487271 DOI: 10.1136/tobaccocontrol-2018-054577] [Citation(s) in RCA: 3] [Impact Index Per Article: 0.5] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 06/18/2018] [Revised: 10/30/2018] [Accepted: 10/31/2018] [Indexed: 11/04/2022]
Abstract
OBJECTIVE Despite claims by tobacco companies that plain packaging would lead to lower cigarette prices, recommended and observed real cigarette prices in Australia rose in the 9-11 months after plain packaging was introduced. However, little is known about trends in prices longer term. In this report, we assess whether inflation (Consumer Price Index; CPI) and tax adjusted ('CPI-tax-adjusted') prices of the market-leading Australian cigarette brand changed in the 3-year period after plain packaging, and whether price changes were associated with retailer characteristics. METHOD Cigarette prices were ascertained from a panel of tobacco retailers at three time points: (1) in November 2012 (n=857) (before full implementation of plain packaging, compulsory in retail outlets from December 2012), (2) between October 2014 and February 2015 (n=789) and (3) between November 2015 and March 2016 (n=579). Generalised estimating equations were used to estimate percentage change in mean CPI/tax-adjusted cigarette prices over time. RESULTS CPI/tax-adjusted adjusted mean stick prices rose by 13.7% (95% CI 13.0 to 16.0) and 15.2% (95% CI 14.3 to 16.0) at 2.1 and 3.1 years after plain packaging was introduced, respectively. Increases in mean CPI/tax-adjusted stick prices varied by outlet type (p<0.001), socioeconomic status (p=0.013) and remoteness of retailer's area (p=0.028) and whether twin packs were sold (p=0.009). CONCLUSIONS Contrary to tobacco company predictions of a fall in prices, the price of the market-leading Australian cigarette brand increased significantly in the 3 years after plain packaging was introduced, and these increases were above the combined effects of inflation and increases in excise/customs duty.
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Affiliation(s)
- Sam Egger
- Cancer Council New South Wales, Kings Cross, Sydney, New South Wales, Australia
| | - Suzan Burton
- School of Business, Western Sydney University, Sydney, New South Wales, Australia
| | - Rebecca Ireland
- Cancer Council New South Wales, Kings Cross, Sydney, New South Wales, Australia
| | - Scott C Walsberger
- National Heart Foundation of Australia, Sydney, New South Wales, Australia
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Scollo M, Bayly M, White S, Lindorff K, Wakefield M. Tobacco product developments in the Australian market in the 4 years following plain packaging. Tob Control 2017; 27:580-584. [PMID: 28993520 DOI: 10.1136/tobaccocontrol-2017-053912] [Citation(s) in RCA: 39] [Impact Index Per Article: 5.6] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 06/21/2017] [Revised: 08/28/2017] [Accepted: 09/12/2017] [Indexed: 11/04/2022]
Abstract
This paper aimed to identify continued and emerging trends in the Australian tobacco market following plain packaging implementation, over a period of substantial increases in tobacco taxes. Since 2012, our surveillance activities (including review of trade product and price lists, ingredient reports submitted by tobacco companies to government and monitoring of the retail environment) found several trends in the factory-made cigarette market. These include the continued release of extra-long and slim cigarettes and packs with bonus cigarettes, particularly in the mainstream and premium market segments; new menthol capsule products; other novel flavourings in cigarettes; filter innovations including recessed and firm filters; continued use of evocative and descriptive product names; the proliferation of the new super-value market segment; and umbrella branding, where new products are introduced within established brand families. Several similar trends were also observed within the smoking tobacco market. While not all of these trends were new to the Australian market at the time of plain packaging implementation, their continued and increased use is notable. Plain packaging legislation could be strengthened to standardise cigarette and pack size, restrict brand and variant names, and ban features such as menthol capsules and filters innovations that provide novelty value or that may provide false reassurance to smokers.
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Affiliation(s)
- Michelle Scollo
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Victoria, Australia
| | - Megan Bayly
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Victoria, Australia
| | - Sarah White
- Quit Victoria, Cancer Council Victoria, Melbourne, Victoria, Australia
| | - Kylie Lindorff
- Quit Victoria, Cancer Council Victoria, Melbourne, Victoria, Australia
| | - Melanie Wakefield
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Victoria, Australia
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Bayly M, Scollo M, White S, Lindorff K, Wakefield M. Tobacco price boards as a promotional strategy-a longitudinal observational study in Australian retailers. Tob Control 2017; 27:427-433. [PMID: 28735275 DOI: 10.1136/tobaccocontrol-2017-053753] [Citation(s) in RCA: 6] [Impact Index Per Article: 0.9] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 03/14/2017] [Revised: 05/24/2017] [Accepted: 05/30/2017] [Indexed: 11/03/2022]
Abstract
BACKGROUND Price boards in tobacco retailers are one of the few forms of tobacco promotion remaining in Australia. This study aimed to examine how these boards were used to promote products over a period of rapidly rising taxes. METHODS Observations were made in a panel of 350 stores in Melbourne, Australia, in November of 2013 (just before) and in 2014 and 2015 (after 12.5% increases in tobacco duty). Fieldworkers unobtrusively noted the presence and characteristics of price boards, and the brand name, size and price of the product at the top of each board. RESULTS Price boards were common in all store types apart from newsagent/lottery agents. The characteristics of the top-listed product changed notably over time: premium brands accounted for 66% of top-listed products in 2013, significantly declining to 43% in 2015, while packs of 20 cigarettes increased in prominence from 32% to 45%. The prevalence of packs of 20 cigarettes in budget market segments tripled from 2013 (13%) and 2014 (11%) to 32% in 2015, with no change in the proportion of packs that were under $A20 from 2014 (37%) to 2015 (36%). The rate of increase in the average price of the top-listed pack correspondingly flattened from 2014 to 2015 compared with 2013-2014. CONCLUSIONS Price boards promote tobacco products in ways that undermine the effectiveness of tax policy as a means of discouraging consumption. Communication to consumers about prices should be restricted to information sheets provided to adult smokers on request at the point of sale.
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Affiliation(s)
- Megan Bayly
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Australia
| | - Michelle Scollo
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Australia
| | - Sarah White
- Quit Victoria, Cancer Council Victoria, Melbourne, Australia
| | - Kylie Lindorff
- Quit Victoria, Cancer Council Victoria, Melbourne, Australia
| | - Melanie Wakefield
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Australia
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Bayly M, Scollo M, Wakefield M. The proliferation of ‘We Sell Tobacco Here’ signs at the point-of-sale of tobacco retailers in Melbourne, Australia. Tob Control 2017; 27:334. [DOI: 10.1136/tobaccocontrol-2017-053713] [Citation(s) in RCA: 1] [Impact Index Per Article: 0.1] [Reference Citation Analysis] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 02/19/2017] [Revised: 04/12/2017] [Accepted: 04/12/2017] [Indexed: 11/04/2022]
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13
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Daube M, Eastwood P, Mishima M, Peters M. Tobacco plain packaging: the Australian experience. Respirology 2015; 20:1001-3. [PMID: 26344700 DOI: 10.1111/resp.12621] [Citation(s) in RCA: 6] [Impact Index Per Article: 0.7] [Reference Citation Analysis] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 11/28/2022]
Affiliation(s)
- Mike Daube
- Faculty of Health Sciences, Curtin University, Perth, Western Australia, Australia
| | - Peter Eastwood
- School of Anatomy, Physiology and Human Biology, University of Western Australia, Perth, Western Australia, Australia
| | - Michiaki Mishima
- Department of Respiratory Medicine, Graduate School of Medicine, Kyoto University, Kyoto, Japan
| | - Matthew Peters
- Faculty of Medicine and Health Sciences, Macquarie University, Sydney, New South Wales, Australia
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Affiliation(s)
- Gerard B Hastings
- Department of Marketing, University of Stirling and the Open University, Stirling, UK
| | - Crawford Moodie
- Department of Marketing, Institute for Social Marketing, University of Stirling, Stirling, UK
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Scollo M, Bayly M, Wakefield M. Did the recommended retail price of tobacco products fall in Australia following the implementation of plain packaging? Tob Control 2015; 24:ii90-ii93. [PMID: 28407617 PMCID: PMC4401344 DOI: 10.1136/tobaccocontrol-2014-051948] [Citation(s) in RCA: 13] [Impact Index Per Article: 1.4] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Subscribe] [Scholar Register] [Received: 08/02/2014] [Accepted: 10/19/2014] [Indexed: 11/03/2022]
Abstract
OBJECTIVES This study aimed to assess the extent of any fall in recommended retail prices (RRPs) of tobacco products sold in Australia following the 2012 implementation of plain packaging. METHODS RRPs published in price lists by the New South Wales Retail Tobacco Traders Association covering the months of November 2011, November 2012 and November 2013 were recorded for all listed brands and pack sizes. Average prices per stick were computed in 2013 dollars for cigarette brands in each of 10 possible pack sizes, for each major tobacco manufacturer, and across market segments. Average prices per gram in Australian dollars adjusted to 2013 prices (AUD2013) were calculated for roll-your-own (RYO) tobacco brands for each major manufacturer. RESULTS Inflation-adjusted average RRPs per stick in November 2013 were on average 6.4% higher than in November 2011 and 3.4% higher than in November 2012. The average RRP per gram of RYO products in November 2013 was 10.2% and 5.4% higher than in November 2011 and November 2012, respectively. Within cigarette brands, the highest increases in RRP from 2011 to 2013 were seen among mainstream and premium brands (10.0% and 10.1%, respectively) and among packs of 30s (18.3%) and 50s (12.5%). CONCLUSIONS The RRPs of tobacco products were higher in real terms 1 year after Australia's plain packaging legislation was implemented. These increases exceeded increases resulting from Consumer Price Index (CPI) indexation of duty and occurred across all three major manufacturers for both factory made and RYO brands, all three cigarette market segments and all major pack sizes.
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Affiliation(s)
- Michelle Scollo
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Victoria, Australia
| | - Megan Bayly
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Victoria, Australia
| | - Melanie Wakefield
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Victoria, Australia
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Scollo M, Zacher M, Coomber K, Bayly M, Wakefield M. Changes in use of types of tobacco products by pack sizes and price segments, prices paid and consumption following the introduction of plain packaging in Australia. Tob Control 2015; 24:ii66-ii75. [PMID: 28407614 PMCID: PMC4401343 DOI: 10.1136/tobaccocontrol-2014-052071] [Citation(s) in RCA: 30] [Impact Index Per Article: 3.3] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Subscribe] [Scholar Register] [Received: 09/29/2014] [Accepted: 01/13/2015] [Indexed: 11/03/2022]
Abstract
OBJECTIVES To describe changes among smokers in use of various types of tobacco products, reported prices paid and cigarette consumption following the standardisation of tobacco packaging in Australia. METHODS National cross-sectional telephone surveys of adult smokers were conducted from April 2012 (6 months before transition to plain packaging (PP)) to March 2014 (15 months afterwards). Multivariable logistic regression assessed changes in products, brands and pack types/sizes; multivariable linear regression examined changes in inflation-adjusted prices paid and reported cigarette consumption between the pre-PP and three subsequent periods-the transition phase, PP year 1 and PP post-tax (post a 12.5% tax increase in December 2013). RESULTS The proportion of current smokers using roll-your-own (RYO) products fluctuated over the study period. Proportions using value brands of factory-made (FM) cigarettes increased from pre-PP (21.4%) to PP year 1 (25.5%; p=0.002) and PP post-tax (27.8%; p<0.001). Inflation-adjusted prices paid increased in the PP year 1 and PP post-tax phases; the largest increases were among premium FM brands, the smallest among value brands. Consumption did not change in PP year 1 among daily, regular or current smokers or among smokers of brands in any market segment. Consumption among regular smokers declined significantly in PP post-tax (mean=14.0, SE=0.33) compared to PP year 1 (mean=14.8, SE=0.17; p=0.037). CONCLUSIONS Introduction of PP was associated with an increase in use of value brands, likely due to increased numbers available and smaller increases in prices for value relative to premium brands. Reported consumption declined following the December 2013 tax increase.
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Affiliation(s)
- Michelle Scollo
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Australia
| | - Meghan Zacher
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Australia
| | - Kerri Coomber
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Australia
| | - Megan Bayly
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Australia
| | - Melanie Wakefield
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Australia
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Scollo M, Bayly M, Wakefield M. Plain packaging: a logical progression for tobacco control in one of the world's 'darkest markets'. Tob Control 2015; 24:ii3-ii8. [PMID: 28407604 PMCID: PMC4392189 DOI: 10.1136/tobaccocontrol-2014-052048] [Citation(s) in RCA: 18] [Impact Index Per Article: 2.0] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Subscribe] [Scholar Register] [Received: 09/26/2014] [Revised: 11/20/2014] [Accepted: 01/13/2015] [Indexed: 11/23/2022]
Abstract
The Australian approach to tobacco control has been a comprehensive one, encompassing mass media campaigns, consumer information, taxation policy, access for smokers to smoking cessation advice and pharmaceutical treatments, protection from exposure to tobacco smoke and regulation of promotion. World-first legislation to standardise the packaging of tobacco was a logical next step to further reduce misleadingly reassuring promotion of a product known for the past 50 years to kill a high proportion of its long-term users. Similarly, refreshed, larger pack warnings which started appearing on packs at the end of 2012 were a logical progression of efforts to ensure that consumers are better informed about the health risks associated with smoking. Regardless of the immediate effects of legislation, further progress will continue to require a comprehensive approach to maintain momentum and ensure that government efforts on one front are not undermined by more vigorous efforts and greater investment by tobacco companies elsewhere.
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Affiliation(s)
- Michelle Scollo
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Victoria, Australia
| | - Megan Bayly
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Victoria, Australia
| | - Melanie Wakefield
- Centre for Behavioural Research in Cancer, Cancer Council Victoria, Melbourne, Victoria, Australia
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