What's Happening?
A recent survey conducted by Goldman Sachs highlights the robust growth of smokeless nicotine products in U.S. convenience stores. The third-quarter 2025 Nicotine Nuggets Survey, analyzed by Bonnie Herzog, managing director and senior consumer analyst
at Goldman Sachs, covers approximately 40,000 convenience-store retail locations across the United States, representing about 27% of all tobacco outlets. The survey indicates that smokeless nicotine offerings, particularly oral nicotine brands like Zyn, Velo Plus, and On Plus, are experiencing strong double-digit growth. Retailers expect this momentum to continue into the next year, driven by innovation and new product offerings. The survey also notes that smokeless/oral nicotine volume grew by 20% in the third quarter, compared to 15% in the second quarter of 2025.
Why It's Important?
The growth in smokeless nicotine products signifies a shift in consumer preferences within the tobacco industry. As traditional cigarette sales decline, companies like Philip Morris International, Reynolds American Inc., and Altria are capitalizing on the demand for alternative nicotine delivery systems. This trend could have significant implications for public health, as smokeless products are often marketed as less harmful alternatives to smoking. Additionally, the increase in smokeless nicotine sales may influence regulatory policies and taxation related to tobacco products. Retailers and manufacturers stand to benefit from this growth, as innovation in flavors and nicotine strengths could further expand the market.
What's Next?
Retailers anticipate continued growth in the smokeless nicotine category, with expectations for a 19% increase in 2026. The survey suggests that innovation will play a crucial role in driving this growth, with new flavors and nicotine strengths likely to attract more consumers. However, the promotional environment in the oral nicotine pouch category is intensifying, leading to mixed views among retailers. Some retailers report significant volume lifts due to promotions, while others express concerns about the category becoming too promotion-driven. The industry may need to balance promotional strategies with sustainable growth to maintain consumer interest.
Beyond the Headlines
The rise of smokeless nicotine products may have broader implications for societal attitudes towards nicotine consumption. As these products gain popularity, they could alter perceptions of nicotine use, potentially reducing the stigma associated with traditional smoking. This shift might also influence cultural norms and behaviors related to tobacco use, particularly among younger demographics who are more inclined to try new and innovative products. Additionally, the success of smokeless products could encourage further research and development in nicotine alternatives, potentially leading to new breakthroughs in harm reduction strategies.
