Future of the Back Bar: Insights from the Tobacco Plus Forum

The Tobacco Plus Forum, held in Schaumburg, Illinois, brought together industry leaders to discuss the future of the back bar in convenience stores. The forum highlighted the challenges and opportunities within the tobacco category, focusing on new category allocations, the rise of alternative nicotine products, and strategies for adapting to changing consumer dynamics. Key speakers from major convenience store chains shared their insights on how to navigate the evolving landscape and maximize the potential of the back bar.

Adapting to New Category Allocations

At the forum, industry leaders emphasized the importance of adapting to new category allocations for the back bar. Peter Frattarola Sr., senior category manager at the Wills Group, discussed how Dash In convenience stores are repositioning e-cigarettes to maximize their potential benefits. By placing these products next to combustible cigarettes, Dash In aims to elevate their visibility and appeal to a broader customer base.

Frattarola highlighted the challenges of being a responsible retailer in the other tobacco products (OTP) category, given the lack of new or approved products. He stressed the need to nurture existing nicotine pouch brands, as the market has yet to determine a clear leader in this segment. This strategy involves reducing cigarette space by 33% and focusing on short-term and long-term performance.

Leslie Edmiston, senior category manager at Wawa, echoed these sentiments, noting the ongoing challenge of managing space for alternative nicotine products. From the early days of vapor to the current explosion of nicotine pouches, Wawa is continuously adjusting its strategy to accommodate these changes.

Embracing Alternative Nicotine Products

The rise of alternative nicotine products was a major topic at the Tobacco Plus Forum. Boris Oglesby of Circana referred to modern oral tobacco as the “industry darling,” highlighting its significant growth. According to Circana data, smokeless tobacco has seen a 14.3% increase in dollar sales, capturing 13.7% of the total category.

Oglesby pointed out that the convenience channel plays a crucial role in supporting the tobacco industry’s shift towards reduced harm products. With cigarettes representing about 72% of the total category of dollar sales, there is a clear need to diversify and promote alternatives. The forum discussed how spitless tobacco, vape products, and cigars are benefiting from the decline in cigarette sales.

The shift towards alternative nicotine products is driven by changing consumer preferences and regulatory pressures. As more consumers seek reduced harm options, convenience stores must adapt their offerings to meet this demand. This includes providing a variety of products and ensuring they are easily accessible to customers.

Strategic Planning for the Future

Looking ahead, the forum emphasized the importance of strategic planning to navigate the evolving tobacco landscape. Retailers must be more thoughtful than ever to accommodate customers with lower disposable incomes. This involves being value-oriented and adjusting to the new macroenvironment.

Frattarola and Edmiston both stressed the need for flexibility and innovation in their strategies. By focusing on category performance over contracts, retailers can make more informed decisions that benefit both the business and the customer. This approach allows for greater adaptability in a rapidly changing market.

The forum also highlighted the importance of responsible innovation and the safety of associates. As the tobacco industry continues to evolve, retailers must prioritize these aspects to ensure long-term success. By staying ahead of trends and being proactive in their strategies, convenience stores can effectively manage the challenges and opportunities that lie ahead for the back bar.