The top executive of tobacco giant British American Tobacco (BAT) has rebuffed claims that the company will prioritize smoking alternatives, stating that such claims are too superficial.
Kingsley Wheaton, Chief Marketing Officer of British American Tobacco (BAT)
During an interview with City A.M., Chief Marketing Officer Kingsley Wheaton stated that although there may be "more advanced methods" for e-cigarette products in the northern hemisphere, this is driven solely by consumer demand and cigarette pricing.
Whittington stated that the deployment of BAT's investment portfolio, which includes Vuse and Glo, was aimed at achieving "maximum growth." He acknowledged that the tobacco industry remains "controversial" and that there is still a long way to go to achieve transformation. The company, which has a history of 120 years, has been undergoing a transformation plan to shift its customers from cigarette brands like Camel and Rothmans to its alternative products.
Wharton stated that, although growth of the company's new product line in markets such as South Africa, Kenya, and Pakistan has been slow, it is stable. The company is also attempting to identify suitable opportunities in developing markets.
Speaking to City A.M., Whitten said, "We need to provide scalable businesses and appropriate profits. Other regions in developing countries are taking advantage of this opportunity." He explained that some regions, such as Australia and Brazil, cannot achieve this due to strict regulations on tobacco alternatives.
He explained, "When cigarette prices rise, it becomes easier to distance oneself from the tobacco business." He cited the UK's success as an example, where 80% of the price of a pack of cigarettes is made up of taxes.
According to data from Action on Smoking and Health (ASH), the current number of smokers in the UK is five times that of 2012, accounting for approximately 8% of the total population.
Whittington stated that despite the fact that this FTSE 100-listed company's foray into e-cigarettes is still not profitable, it remains committed to its ambitious goal of new category tobacco comprising one-fifth of its overall revenue and profitability by 2025. For a company that serves 175 countries worldwide and generated over £25 billion in revenue in 2021, this goal may seem insignificant.
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