Introduction: Since launching its first e-cigarette a decade ago, New Category products now account for nearly 17% of the group’s revenue, underlining its mission to ‘Build a Better Tomorrow’ by reducing the health impact of its business. In this guest column, BAT General Manager China and Global Travel Retail Andy Hrstic talks about the tobacco giant’s ongoing move towards a multi-category portfolio and the role travel retail plays in driving that transformation. He also looks back at the company’s biggest travel retail milestones in the last year, as the company uses both education and engagement to inspire adult smokers to switch to ‘reduced-risk*† alternatives’.
At BAT, our purpose is clear, and that is to build ‘A Better Tomorrow’ by reducing the health impact of our business. We know that cigarettes pose serious health risks and that the only way to avoid those risks is to not start or quit smoking. We are committed to encouraging those, who would otherwise continue to smoke, to switch completely to reduced-risk*† alternatives to smoking.
To build A Better Tomorrow, we are developing and offering our consumers innovative choices of alternative products to smoking under global brands they can trust, underpinned by robust science.
September marks two years since I joined BAT as a General Manager in New Zealand. Over these two years, I have been able to witness BAT’s flagship vapour brand, Vuse, become the number one brand globally in its category*2, enabling many adult smokers to switch to these alternatives from cigarettes.
As I now take on this role of General Manager of the Global Travel Retail business at BAT, it is reassuring to see how we are already accelerating our transformation as a multicategory business, and I am truly excited to further accelerate our A Better Tomorrow journey with our global partners in the travel retail space.
In the first half of this year, BAT reached 24 million consumers with our non-combustible products, which include New Category products like vapour, tobacco heating and modern oral products. It’s been ten years since BAT launched its first e-cigarette, and now we’re seeing that these non-combustible products account for nearly 17% of the Group’s revenue.
Within the Group, BAT Global Travel Retail continues to play a key role in enabling the growth of our New Category products. We launched a series of pop-up stores and promotional spaces around the world, focusing on educating and engaging adult consumers on our global New Category brands: glo (tobacco-heating product brand), Vuse (vapour product brand), and Velo (modern oral brand). Let’s take a look at some of our latest achievements.
Dubai International Airport welcomes BAT’s new pop-up store in partnership with Dubai Duty Free
We created a new pop-up store at Dubai International Airport (DXB) Terminal 1 in partnership with Dubai Duty Free to help adult consumers explore the diverse range of our New Category products. Here, we engage with a global audience of adult travellers to offer a unique and immersive experience that helps them find a product that caters most to their preferences.
With interactive digital technology at the store, we are able to effectively educate adult consumers about our brands, features and their reduced-risk*† potential compared to smoking. Our adult consumers can also enjoy a customised experience with the brand by personalising their products using the engraving machine.
Multi-category activation in Paris, Geneva and Vienna
Catering to the ever-evolving preferences of adult consumers, we are showcasing our diverse range of New Category products at our promotional spaces in Paris, Geneva and Vienna airports, in partnership with Extime Duty Free (the Joint Venture between Lagardère Travel Retail and Groupe ADP) and Gebr. Heinemann.
BAT brand ambassadors are present at each location to interact with our adult consumers and help educate them on the product categories we offer. The promotional spaces also collect valuable consumer insights and feedback from the ground, helping us further enhance our product offerings, so we can continue to innovate and meet the ever-changing needs of our adult consumers globally.
Revamped activation space in Madrid-Barajas Airport
We have refreshed our activation space at Adolfo Suárez Madrid Barajas Airport Terminal 4, operated by Dufry, to create a more dynamic and engaging environment for travellers. The revamped displays showcase the various features of the new Vuse product range in a colourful and engaging manner.
Delivering our ‘A Better Tomorrow’ strategy through our global partners
Setting up these high-profile spaces in key locations across the world, we can further amplify our brand presence to reach more adult smokers, who would otherwise not quit smoking. This reinforces our commitment to reducing the health impact of our business by offering a wide range of reduced-risk*† products that can cater to their preferences while they are on the move.
We are committed to building awareness for our New Category products for adult smokers to make an informed decision to switch to enjoyable, less-risky*† alternatives. This commitment is truly reflected in our recent activation efforts across the global travel retail space.
However, we can’t do this alone. To make our vision of A Better Tomorrow a reality, close cooperation and support from our global partners and duty free operators are critical. We firmly believe that a close partnership will enable us to reach and educate more adult smokers to encourage more to make the complete switch.
As I take on this role, I am excited to see how we can further our collaboration with duty free operators to build on what we have already achieved and to offer adult consumers ever more engaging on-the-go retail experiences. 
* Based on the weight of evidence and assuming a complete switch from cigarette smoking. These products are not risk-free and are addictive.
*2 Based on Vuse estimated value share from RRP in total measured retail for vapour in key vapour markets: USA, Canada, France, UK, Germany as of May 2023.
† BAT products as sold in the US, including Vuse, Velo, Grizzly, Kodiak and Camel Snus, are subject to FDA regulation, and no reduced-risk claims will be made as to these products without agency clearance.
