Dissolvable tobacco products appealing to women

Adult female tobacco users have proved an elusive consumer group for manufacturers' smokeless and smoke-free products, particularly — and especially — if they involve spitting.

However, R.J. Reynolds Tobacco Co. reported recently that its Camel dissolvable tobacco products, which do not require spitting, are gaining traction with women in its test markets of Charlotte, N.C., and Denver.

Reynolds said the flavored, finely milled tobacco products serve as an alternative to cigarettes, giving adults a discreet option in venues where smoking is banned out of concern for secondhand-smoke exposure.

Reynolds' dissolvable products include:

• Camel Sticks, a stick of pulverized tobacco with flavoring, similar in shape to a toothpick.

• Camel Strips, tobacco film strips that dissolve in the mouth.

• Camel Orbs, similar in shape to Tic Tacs.

Of the adult smokers who bought Camel Sticks, Camel Strips and Camel Orbs in the test markets during September and October, adult females represented 45 percent of the consumers, according to Reynolds.

Of all tobacco consumers, 31 percent of the buyers were adult females.

By comparison, adult males constitute 85 percent of the users of moist snuff and Camel Snus.

"We have seen a noticeable appeal and interest of the dissolvable products with adult female tobacco consumers," said Reynolds spokesman David Howard.

Stephen Pope, an industry analyst and managing partner of Spotlight Ideas in England, said Reynolds might have discovered a niche with adult female tobacco users.

"Clearly the figures for the dissolvable products make for fascinating reading and actually show that here could be a product that, if handled correctly, could well offer an opportunity for a special female-targeted product that could be as significant as Virginia Slims was for Philip Morris," Pope said.

The dissolvable products "could prove to be the first viable smokeless tobacco products for females," wrote Bonnie Herzog, an analyst with Wells Fargo Securities LLC.

Reynolds has not said when the national rollout of the products will happen.

The dissolvables could play a pivotal role for Reynolds' transformation into a "total tobacco company" that emphasizes smokeless tobacco sales as cigarette volumes continue to decline amid regulatory and societal pressures.

The transformation is daunting for Reynolds considering there are 42 million adult smokers in the U.S. compared with 8 million adults who consume moist snuff and 3 million adults who consume snus. Camel Snus, a spitless, smokeless tobacco, holds about 70 percent of the U.S. snus market share.

However, about 50 percent of the 1 million U.S. adults who successfully quit smoking turn to smokeless products, Herzog wrote.

"The relative risk of these products vary greatly, with smoking likely causing the most risk to consumers and dissolvables likely causing significantly less risk," she said.

Howard said Reynolds has no plans to expand testing of the dissolvable products beyond Charlotte and Denver. Reynolds exited test markets in Columbus, Ohio; Indianapolis; and Portland, Ore., last December after two years.

Jeff Middleswart, portfolio manager for the Vice Fund of USA Mutuals, said having the Camel and Marlboro brands in dissolvable products is likely to intensify the debate among advocacy groups.

One set says that smokeless tobacco products serve as gateways for teenagers to cigarettes. The other set sees the products as a way to reduce the risk of tobacco use compared with cigarettes.

"Anything tobacco will create criticism — it's just the way of the world," Middleswart said. "A new product that has the potential to gain market share is going to be a target."

Matthew Myers, president of the Campaign for Tobacco-Free Kids, has called on Reynolds to permanently pull the dissolvable products and to stop pushing tobacco products that he said entice children and discourage smokers from quitting.

Myers has said the dissolvable products appeal to children because they are easily concealed and colorfully packaged, shaped and flavored to resemble mints or gum.