In the global tobacco market, a profound fission is under way. Observing the change curve of the global TOP10 tobacco companies’ revenue share of new products (2018-2024), we can clearly see the trend of change. Once dominated by traditional tobacco giants, the proportion of new product revenue has risen year by year. Among them, Philip Morris International is particularly concerned, and its 2025 “smoke-free future” strategy sets a target of 53% of new products, which has become a key turning point in market fission. The proposal of this goal means that Philip Morris International will vigorously invest resources to promote the development of new products, reshape its own business pattern, and also bring far-reaching impact on the development direction of the entire industry.
At the technical level, traditional tobacco manufacturers are engaged in a fierce arms race with new alternatives. Taking heating non-combustion technology as an example, the IQOS ILUMA smart core upgrade has built 38 patent barriers. Through these patents, the temperature is precisely controlled during the heating process, reducing the formation of harmful ingredients, while ensuring a stable nicotine release and maintaining the consumer suction experience. On the other hand, in the field of biosynthetic nicotine, synthetic biology companies offer the potential to disrupt the tobacco growing industry. The use of microbial fermentation and other technologies to synthesize nicotine, get rid of dependence on tobacco cultivation, reduce production costs, and product ingredients are easier to control, reduce impurities, is expected to make breakthroughs in health harm reduction.
Consumer migration presents a specific model. Portraits of addicts show that there are seven key decision points for traditional smokers to switch to new products such as mouth film, including product harm reduction effect cognition, ease of use, taste similarity, price rationality, social acceptance, brand influence and health warning impact. From the perspective of behavioral economics, loss aversion has been reversely applied in the promotion of harm reduction products. To highlight the dangers of traditional tobacco and to make consumers aware of the health losses they may face if they continue to use traditional tobacco, thus encouraging them to try new harm reduction products.
Geopolitical factors have become important variables in the development of the industry. Indonesia, the world’s largest tobacco market, faces a policy dilemma of balancing fiscal revenue with the pressure of WHO to control tobacco. The tobacco industry is an important economic pillar in Indonesia, providing a large amount of tax revenue, but at the same time, it needs to comply with the tobacco control requirements of WHO, and how to formulate reasonable policies has become a problem. In the United States, only 3% of PMTA certified e-cigarette products have passed the review, causing an industry earthquake. Strict certification standards have made many e-cigarette companies face the dilemma of product removal and business obstruction, and the industry pattern has been reshuffled.
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