IMB Suspends Sales Incentives, Impacts Independent Retailers' Profitability

According to Better Retailing's report on January 2, Imperial Brands (referred to as "IMB" hereinafter) has suspended sales incentive programs for multiple product lines. Several retailers have stated that these incentives can generate thousands of pounds in revenue for some stores each year.

For many years, IMB has been encouraging stores to sell its products at prices below the recommended retail price (RRP) and paying the stores a corresponding fee for each pack of cigarettes discounted. These payments are made through IMB's Ignite reward card.

However, in less than a week before Christmas, five store owners have revealed to Better Retailing that they were informed by representatives from IMB that many of the incentive measures for the product lines involved previously will be immediately discontinued. The information sent by IMB to the stores stated that this suspension affects all "Price It Plus & Sell IT" activities. Additionally, these incentive measures are expected to resume after three months. IMB also added that company representatives will visit stores to carry out the current plan of "de-registering.

When asked about the change, a spokesperson for IMB told Better Retailing,

Some of the incentives in the Ignite program will be temporarily suspended to allow for improvements to its digital architecture, ensuring that retailers can apply for rewards more smoothly. These incentives are expected to resume in a few months, and we will continue to provide updates to retailers.

A retailer attributed this change to IMB shifting its focus to their newly launched cigarette brand "Paramount." "Paramount" was launched in November 2024, and exclusive checkout data obtained by Better Retailing from several thousand stores indicates that approximately 38% of independent retailers were already selling "Paramount Superkings" or "Paramount King Size" cigarettes by December 8. The average weekly sales for both series are £116.15, with an average retail price of £11.50.

Despite Paramount performing well, retailers have stated that the cancellation of incentives may make it more difficult for independent stores in 2025. They added, "Since payments are accumulated on the card, stores typically use them for savings or to pay unexpected bills. We know that 2025 will be a tough year, and this will undoubtedly make things even harder.

IBM stated that it will be using cash and vouchers for "big discounts" to make up for the gaps in rewards until they are restored. A price list obtained by Better Retailing shows that prices have increased across the board starting from January 6th. For example, the suggested retail price for "Paramount" will be raised from £11.50 to £12.10.