The Federal Trade Commission recently issued its Cigarette Report and Smokeless Tobacco Report summarizing 2016 data about the tobacco industry. Important observations from the Cigarette Report include:
- The number of cigarettes that the largest cigarette companies in the United States sold to wholesalers and retailers nationwide declined from 244.2 billion in 2015 to 240.5 billion in 2016;
- The amount spent on cigarette advertising and promotion increased from $8.30 billion in 2015 to $8.71 billion in 2016; and
- Price discounts paid to cigarette retailers ($5.81 billion) and wholesalers ($1.44 billion) were the two largest expenditure categories in 2016. Combined spending on price discounts increased from $6.95 billion in 2015 to $7.25 billion in 2016, accounting for 83.2 percent of industry spending.
The Smokeless Tobacco Report confirms the steady rise in sales of smokeless tobacco products:
- Smokeless tobacco sales increased from 129.4 million pounds in 2015 to 131.4 million pounds in 2016. The revenue from those sales also rose, from $3.68 billion in 2015 to $3.98 billion in 2016;
- Spending on advertising and promotion by the major manufacturers of smokeless tobacco products in the U.S. increased from $684.9 million in 2015 to $759.3 million in 2016; and
- Price discounts made up the two largest spending categories, with $382.3 million paid to retailers and $85.5 million paid to wholesalers. Combined spending on price discounts totaled $467.8 million – or 61.6 percent of all spending in 2016, up from the $428.9 million spent in 2015.
The FTC has issued the Cigarette Report periodically since 1967 and the Smokeless Tobacco Report periodically since 1987.
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