EU Market Analysis: The Nicotine Pouch Flavour Report

The Nicotine Pouch Market Dec 16, 2020

Hello my fellow Nicotine Freaks,

A question for you. As 2020 comes to a close, which flavours do you think are the most commonly available on the European nicotine pouch market right now?

Maybe you have an idea in mind or know the facts already. Maybe you don't have a clue. Both answers are OK. This article is going to share with you some of the most recent market research and analysis of nicotine pouch flavourings sold in Europe today. We will save North America and other continents for another day, no doubt it would make for an interesting comparison!

Do read on...

The Importance of Education

We are sure you don't need us to remind you but I'll say it anyway. Those of us involved in nicotine pouches, in whatever capacity, must not forget this is a definitive sunrise industry. This is fantastic because there is a great deal of growth potential and is probably one of the main reasons we are all get excited about nicotine pouches to begin with! The downside of course is that many people, like Joe Soap on the street, have never heard of nicotine pouches or even heritage products like traditional tobacco-based snus, despite its history.

The Nicotine Pouch Sunrise Industry and a Real Greek Island Sunrise

I currently live on a Greek island and took the above photo - the colours of the sky in this country never fail to amaze me. Artists I've spoken to (many of them from Scandinavia) say Greece is one of the most difficult countries for artists to paint and as a result many flock here for the rewarding challenge of painting its beautiful landscapes and skylines consisting of so many different shades of colour which dynamically change in real-time before your very eyes. You may notice there is a friendly but rather disobedient dog in this image called Iraklis (Hercules) by the locals. Hercules refused to get out of the way even when I very politely asked. Anyway, I'm sure 'Hercules' will be pleased when I let him know he's made it onto the internet for eternity now!

Most countries have a smoking 'problem'. Greece is a country with a particularly bad smoking problem. I truly believe, no doubt like many of you reading, that nicotine pouches are the best way of reducing smoking rates. Approximately 37% of Greeks are smokers and only 44% of Greeks have never smoked a cigarette, the smallest percentage in the EU. There is room for pouches to take hold here. Anway, back to the point about education.

Last week, at a socially safe distance, I was showing a friend of mine, who is also a Greek wholesaler and distributor, some sample nicotine pouches from various brands. Himself a smoker for many years, he'd heard of snus and snuff but had never tried it. He had never heard of tobacco-free (or 'all white') nicotine pouches before. He was of course very interested in the business potential after I explained this aspect of it to him. I cracked open a can and he took one glance and asked me, to my dismay, "so I just EAT it right?". In his mind, the pouch was more akin to something like candy of some kind.

This kind of question might seem crazy, but it's amazingly common. He's not the only person who's asked me this exact question. So that is the stage we are at.

A lot of education still needs to be done to raise awareness about nicotine pouches. COVID-19 and physical restrictions on movement have made it more difficult. Nicotine Freak is actively doing what it can. As an industry, we cannot forget that a lot more education and raising of awareness still needs to be done - the little anecdote above represents a stark reality that we should all bear in mind.

Nicotine Pouch Brands are Adopting Very Different Flavour Strategies

For end consumers, it can be difficult to choose a flavour. A leap of faith is required to give something new a try, especially when you are spoilt for choice in not just in terms of flavours but also the number of brands that are offering their own take on them. It is a bit of a stab in the dark for end consumers.

Decisions, Decisions, Decisions - Where Do You Start?

Nicotine Freak sees brands adopting some very different flavouring strategies to navigate this problem. These strategies vary heavily by geography. Annoyingly for many of us nicotine pouch enthusiasts, some flavours from certain brands aren't available in Europe and are only sold in the Americas or even exclusively sold in places as far away as South East Asia. And vice-versa. The brands doing this know who they are! We accept that for brands, this is an understandably cautious testing of the waters.

Some brands offer as many as ten or more flavours, a sort of 'carpet-bombing' approach, presumably to cover all bases from the outset by increasing the chances an SKU will appeal and then reacting by quickly ramping up its production and marketing budget.

We see other brands thinking differently, opting for a 'less is more' approach by offering only 3 flavours, 2 flavours or sometimes even just one flavour. Interestingly, this seems to be the case for most 'Big-Tobacco' owned or partly owned brands. The thinking behind narrow flavour ranges is simplifying what can be an intimidating array of choice for newcomers who are still in the process of product acceptance. This strategy creates new markets by gently guiding consumers into nicotine pouch use, until they are satisfied/accepting of the pouch product itself and ready to try new flavour variants.

Proponents of the 'narrow' flavour range approach may argue that it makes it easier for consumers to buy from a simple and less confusing selection while simultaneously sharpening brand value, identity, and by extension, brand loyalty among new consumers.

In the 'education' phase of a product life cycle (where I'd say we are), product awareness grows. Once product awareness builds traction and people start trying nicotine pouches, the process of strengthening customer brand loyalty starts. As sales figures move in the right direction, brands with a narrow range of flavour SKUs can then gradually start adding or drip feeding new flavours and strengths into their product mix, lessening the risk of damaging carefully crafted brand identity and coherence or confusing customers in these newly created and and less mature markets.

Being Data Driven - Trial, Error and Capturing Lessons From the Market

Bearing the described variance of flavour strategies in mind, one may be forgiven for thinking that brands, retailers and manufacturers are still figuring out the answer to the 'flavour question'. Retailers and distributors are experimenting too. The evidence for this is the myriad of alluring 'bundles', 'selections' or 'mixed' discount offers we see, which are aimed not only at achieving higher overall unit sales volumes (important for getting that distribution license renewed and clawing early market share!) but also giving consumers the chance to try out different flavours and identify where the growth opportunities are to be found.

Forward-thinking and more data-driven brands and retailers who have Know Your Customer (KYC) processes in place and are capturing actions, behaviour and decisions of their customers (or potential ones) are mining extremely valuable and actionable data, unearthing branding, flavour and strength preferences among consumers so that market segments can be identified, targeted and serviced accordingly. Entirely new brands can be developed around these insights. Metrics and methods of interpretation are plentiful: flavour sales broken down by age, purchasing volumes, time of year (season), spending power, gender, geography, lifestyle insights by web crawling social media profiles and so on.

Businesses that have invested in this area (buzzword of our age: 'Digital Transformation') are equipped to capture and interpret data which will benefit their business tremendously for many reasons. In my personal view, perhaps the most important advantage of utilising technology will be in helping decision makers, especially those in the C-suite, to make smarter business decisions than their competitors. I'll stop there before I forget we are talking about nicotine pouch flavours today, not the use of artificial intelligence in business contexts, but I wanted to quickly highlight the importance of data for brands and retailers in the nicotine pouch industry - it is not only of value to the suits in financial services and insurance.

Some Will Hate, Some Will Love. Learn to Give Them What They Love

The Subjective Nature of Taste

Every individual has a unique set of taste buds. I am certainly no scientist and would never pretend otherwise, but from my own reading I know this to be true on a chemical level, rendering flavour experience an entirely subjective matter. For example, no two people will have the the exact same experience when drinking the exact same bottle of wine or beer. Have you ever winced when you see 'blind' wine tastings during which 'experts' and sommeliers choose the £5 blended table plonk over the £100 pound vintage bottle of Estate Cab?

During an awesome previous chapter of my life, while living in Berkeley in the San Francisco Bay Area, I was fortunate to go on a Wine Country bus tour. A group of about 10 of us boarded a minibus to visit the nearby vineyards of the Napa and Sonoma valleys in Northern California. Things began in a pretty civilised fashion and everyone seemed so very 'cultured'. By the time we arrived at the third or fourth winery, that all went out the window. Things started getting as manic as you'd expect them to!

One of the few things I remember from that day, aside from the beautiful surroundings of Napa and Sonoma, were the comments made by one Californian winery owner, a former banker who was living the dream after having invested some of his millions into the venture. He scoffed at the French snobbery towards his excellent Californian wine, and said to me, "If you like the taste of the $7 bottle man, you go drink that $7 bottle!", he went on, "Don't let some guy in France tell you what's good wine." This has always stuck in my mind because I couldn't agree more with him.

His sentiments mirror Nicotine Freak's own open minded philosophy and review style which is partly why we never give anything a 'score'. We feel it is a bit pointless, particularly for nicotine pouches. Apologies for the crude analogy, but one man's (or woman's) 4 is another man's 9! Back in the day, I never rated Jennifer Aniston but my mate loved her, and tragically, he probably still has a fading poster of her on his bedroom wall.

We have to be open minded. Some nicotine pouch flavourings simply sound plain weird at first and don't relate to anything in the natural world at all. This isn't a problem and doesn't mean it can't be a hit. There is is no such thing as a cola tree, but that didn't stop cola from becoming one of the world's most (literally, in some parts of southern Mexico) revered flavours/beverages, across all cultures, demographics and geographies.

Manufacturers and brands (or future ones) reading this: we love trying new things at Nicotine Freak. It's why we do what we do. If you have any off the wall flavour, branding, product, packaging or any idea relating to pouches in mind, get in touch. We'd be glad to listen to what you have to say. We'll give you our address, you can send a few cans over and we will give you our honest two cents based on the countless products we've worked our way through, for the benefit of the nicotine pouch industry as whole and for our rapidly growing community of readers and social media followers. Simple as that.
Get in touch with Richard and Tim

The European Market Flavour Study

A recent study conducted by Wingle Consulting provides a comprehensive analysis of the European tobacco-free pouch market and investigates the market 'as is' based on a broad set of 327 different nicotine pouch products on sale in Europe today. The report looks at all aspects which make up nicotine pouch products, one of these of course being flavouring which we are looking at today. The decent-sized sample set adds credibility to the findings released in all other chapters of the report.

'Herbal' flavours are overwhelmingly dominant, accounting for 46.9%, almost half of products sampled. This is because of the various forms of mint on offer. The fact that mint is the leading category is probably not very surprising to anyone reading, it certainly wasn't to me. Almost every brand offers a mint flavour pouch in some form or another.

It is also worth noting that while a form of mint is often sold as a standalone product, mint pairs well with a lot of other flavours and it is therefore common to see it in combination with flavours like apple, peach and other fruits. I perhaps wouldn't have expected mint to be quite as dominant as almost a full half though. I think that while mint is a 'safe bet' for brands seeking to lure in new consumers and create markets, it's really not exciting. I would predict its % share may drop a little next year, but I will certainly not be eating my hat if it doesn't!

'Fruit' and 'Berry' flavour categories come in at second and third place and are clearly very popular taking 22.8% and 19.5% of the pie respectively. I can see strong growth potential in these two categories, with forest fruits and citrus being personal favourites. Based on the conversations we at Nicotine Freak are having with the market, these two categories are seemingly on a strong growth trajectory. I'm down for that.

Next we see 'Beverages' e.g coffee, beer, mohito, etc which takes a far smaller share of the pie at 4.5%. I'd really like to see more coffee offerings in 2021. I've tried a couple of brands own take on coffee flavour and liked them a lot. Think about smoking - that 'best first cigarette' of the day would quite often be accompanied with a strong cup of almost radioactive black coffee. Since nicotine pouch users are comprised of so many ex-smokers and the industry is seeking to attract current smokers to switch, I suspect I'm not alone when it comes to seeing the appeal of coffee flavours.

Spice flavors (chilli, pepper etc) which you can see combined with fruits such as lime take 4.3%. 'Sweets' such as candy, cheese cake, sherbert etc made up just 1.4% of the product set analysed. Clearly there is a lot of room to grow this category especially when one considers the success of cake/dessert flavours in the vaping world. Cheesecake, apple tart and other 'desserts' were were personal favourites and and anecdotally at least, a great hit among my peers during my vaping days.

The European Nicotine Pouch Market Broken Down by Flavour

Take a look at the pie chart below representing the % share and categorical breakdown of the 327 products sampled. Are you surprised?

The Top 15 Flavours on the Nicotine Pouch Market

The bar graph below is self explanatory. It represents the top 15 'flavours' from any of the 'categories' into which the 327 products assessed have been grouped in Wingle's report (Herbal, Fruit, Berry, Beverage, Spice, Sweets). You can clearly see the domination of the 'Herbal' category, which we can see as basically being mint in various forms.

To me, this graph indicates the room for growth that exists within other mainstream and uncontroversial flavours that are very popular in their natural non-nicotine pouch form, especially those that fall within the 'fruit' and 'berry' flavour categories. Citrus, lemon and strawberry - blueberry as well - they are all taking a good bite of the market and gaining traction. Blueberry in particular is a fruit that is typically not cheap to buy and is considered as somewhat of a 'treat' or marginal luxury. This is why European supermarkets, when the famed Polish supply of blueberries runs out or is not competitively priced, can have fresh stock packed and air-freighted economically from places as far away as California and Chile.

Top 15 Flavours Sold by in the EU Based on 327 Products Surveyed 

One other interesting point to note is that 'Wintergreen', a rather dominant flavour profile in the US market, has yet to gain any noticeable presence at all in Europe. This too could represent an area of flavour opportunity for European brands to explore.

I think I am more of a citrus man myself - I love an orange, a lemon or a lime. But I am willing to try anything out and give it a fair chance. I would love to see more of these types of flavours on the market and I do not see consumers having a hard time accepting these. They are loved in real life so why not in a nicotine pouch?

An additional surprise and opportunity area - chocolate, caramel and nougat are practically nowhere to be found. Chocolate of all things! Wouldn't it be nice to try a chocolate flavoured nicotine pouch?

Might it be possible that chocolate pouches may appeal to a certain demographic, consisting of  50% of the human population that is traditionally associated with buying and consuming a lot more chocolate than the other 50%?

Or how about a chocolate and caramel flavour? Or Mocha? Brands and manufacturers, take note - these flavours are hugely underrepresented.

What's in Store for Nicotine Pouch Flavourings in 2021 and Beyond?

So there we have it. A high level look at the situation on the ground. The full report from Wingle is worth checking out.

What brands decide to do with their flavour offerings will depend on their own research, customer data and brand strategy. Mint is dominant - but does it really have to be so dominant?

Nicotine Freak are going to be following closely any changes that take place in the flavoursphere as we progress into 2021.  As we said before, if you have any ideas or thoughts about flavourings, brandings or marketing,  do get in touch with us on our Instagram directly @nicotinefreakuk and we will happily have a chat!

Thanks for reading everyone. Have a great day from Nicotine Freak.


Timotheos (Tim) Hatzis

China Expert and Business Consultant

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