Amount spent on cigarette advertising increased from $ 7.62 billion in 2019 to $ 7.84 billion in 2020
The number of cigarettes that the largest cigarette companies in the United States sold to wholesalers and retailers nationwide increased from 202.9 billion in 2019 to 203.7 billion in 2020, according to the latest report from the Federal Trade Commission on cigarettes. This is the first time that annual cigarette sales have increased in 20 years.
According to the 2020 Smokeless Tobacco Report, smokeless tobacco sales increased from 126.0 million pounds in 2019 to 126.9 million pounds in 2020. Revenue from these sales increased from 4.53 billion pounds. dollars in 2019 to $ 4.82 billion in 2020. For the first time, the Commission is reporting sales of nicotine lozenges or sachets that do not contain tobacco. In 2020, the companies sold 140.7 million units of these products in the United States, for $ 420.5 million.
The amount spent on advertising and promoting cigarettes increased from $ 7.62 billion in 2019 to $ 7.84 billion in 2020. Rebates paid to cigarette retailers ($ 6.07 billion) and to wholesalers ($ 876 million) were the two largest spending categories in 2020. Combined spending on price rebates accounted for 88.5% of industry spending.
Advertising and promotion spending by major manufacturers of smokeless tobacco products in the United States declined from $ 576.1 million in 2019 to $ 567.3 million in 2020. As with cigarettes, the rebates on prices were the two largest expense categories, with $ 296.6 million paid to the millions paid to wholesalers. Combined spending on awards totaled $ 380.1 million, or 67.4% of all spending in 2020, compared to $ 376.0 million spent in 2019.
For the first time, the 2020 data includes information on the flavors of companies’ smokeless tobacco products. Menthol flavored smokeless tobacco products accounted for more than half of all sales revenue (54.5 percent); tobacco flavored products (ie no flavor added) accounted for 43.4 percent; and fruit flavored smokeless tobacco products accounted for 2.5 percent.
The Commission has periodically published the Cigarette Report since 1967 and the Smokeless Tobacco Report periodically since 1987. In view of the worrying trends highlighted in this report, including the first increase in cigarette sales in two decades, the Commission will continue to expand its approach to reporting on changes in the tobacco industry. The FTC will also use the newly entered data on smokeless tobacco products to align the Commission’s enforcement efforts with emerging realities in the tobacco industry.
The Commission’s vote to release the reports was 5-0. (Staff contact is Michael Ostheimer, Bureau of Consumer Protection, 202-326-2699.)
The Federal Trade Commission works to promote competition and to protect and educate consumers. You can learn more about consumer matters and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). For the latest news and resources, follow the FTC on social media, subscribe to press releases, and read our blogs.
Cover photo courtesy of Pixabay