At the "Global NGP Rethink Forum" organized by 2Firsts, Kenneth Tam, the Asia regional director of the well-known Russian e-cigarette brand PLONQ, and his team attended the event and delivered a keynote speech titled "The Russian Nicotine Market: An Inside Look" As a leading e-cigarette brand in Russia, PLONQ's insights provide the industry with valuable first-hand perspective from the local market.
Market Dynamics are Changing: E-cigarette Market Share Reaches 11.38%, Trend of Multiple Categories Coexisting Accelerates
According to Kenneth Tam's on-site sharing, the nicotine market in Russia is currently in an accelerating evolution stage. As of April 2025, traditional cigarettes still dominate, accounting for 73.76%; meanwhile, new tobacco products are gradually eating into market share, with e-cigarettes accounting for 11.38%, HNB products at 10.67%, e-liquid at 2.89%, and oral tobacco at 1.30%.
The taste preferences in the Russian market are also undergoing significant changes: in HNB products, the percentage of flavored tastes reaches as high as 67%, while traditional tobacco flavors have decreased to 11%. Even in traditional cigarettes, products containing flavorings and capsules account for nearly 50% of the market. It is evident that consumer preferences for flavors have profoundly reshaped the product landscape.
Retail Channel Restructuring: Reversal in Proportion of Specialty Stores, Profit Structure Shifting Towards New Tobacco Types
Kenneth Tam explained that in the retail sector, PLONQ pointed out that the channel structure is undergoing fundamental changes. In national chain retail channels, traditional cigarettes and HNB still occupy 80% of the sales market share; while in independent stores and e-cigarette specialty stores, this ratio is completely reversed, with new products collectively occupying 80%, forming a "channel fragmentation" pattern.
The retail profit margins of the new products also show overwhelming advantages: e-cigarettes at 30%, e-liquids as high as 40%, and oral tobacco at 25%, all much higher than traditional cigarettes (5%) and HNB (10%).
It is worth noting that independent brands in Russia are growing significantly. In the first half of 2025, brands without a background in large tobacco companies saw a 13% year-on-year increase in sales and a 20% increase in value in the cigarette category; the market share of HNB brands also increased from 0.15% to 1.6%. Kenneth Tam stated that PLONQ, as a leading brand, ranked first with a 25% market share in offline retail data at the end of 2024, leading second place Lost Mary by 1.8 percentage points.
Regulation and Uncertainty Coexist: Clear Compliance Path, Uncertain Future of ENDS Policy
In terms of regulatory environment, Kenneth Tam believes that Russia's policy implementation is relatively predictable, but there are still uncertainties in its long-term policy direction. Currently, systems for regulating consumption tax, product labeling, and retail compliance have been relatively stable. However, key issues such as flavor restrictions, the definition of products containing nicotine, and the ban on e-cigarettes (ENDS Ban) have not yet been clearly addressed in policy, requiring companies to remain flexible in their strategies.
During the 2Firsts forum, Kenneth Tam provided detailed answers to issues of concern to participants such as channel expansion, brand design, and compliance responses, receiving wide acclaim.
He stated, "The complexity of the Russian market is both a challenge and an opportunity for building brand differentiation. PLONQ's strategy is to steadily promote channel cultivation and product localization under compliance, in order to steadily and continuously advance."
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