Could women be the next growth avenue for cigarette companies?


The Covid-19 pandemic has caused destabilisation and a lot of panic around the globe. More recently, there has been claims from some researchers that smokers are much less likely to suffer severely from Covid-19, suggesting that nicotine may be a potential preventive agent against the infection. However, the World Health Organisation (WHO) recently issued a statement urging researchers and  scientists to be cautious about amplifying such claims given that there is currently insufficient information to confirm any link between tobacco or nicotine in the prevention or treatment of the virus. According to Piggy, this demonstrates how the global health sector is in a muddle regarding the Covid-19 pandemic. On another note, the risk for cigarette companies has always been the increase in health awareness and restrictions on cigarette marketing. As a result, there has been some declines in prevalence in countries with active tobacco control efforts. That said, the big question is, “What is the next growth avenue for cigarette companies and could it be female smokers?

According to Tobacco Atlas, smoking rates in women in high-Human Development Index (HDI) countries follow the pattern set by men, 30-50 years later. This trend is likely to occur in many other low-HDI countries in the future because of income growth and increasing cigarette affordability. There has also been a recent increase in smoking prevalence among youth, particularly females, in several low- to high-HDI countries, in some of which smoking among adolescent girls is now more common than among adult women or even adolescent boys.

But…are Cigarettes signs?

Cigarettes are hardly just nicotine sticks. They are “signs” because they have all three aspects—they have physical structure, they refer to specific ideas, and, of course, they evoke different interpretations in different people. In today’s society, there has been an increased attention on women empowerment and independence. When females started smoking in the early part of the twentieth century, the cigarette was perceived as a threatening symbol of equality and independence to the patriarchal culture at the time. A particular brand of cigarettes called Virginia Slims, has always played precisely on this meaning, equating cigarette smoking with female power and women’s liberation.

From the outset, the Virginia Slims brand has emphasized that smoking, once considered a “male thing,” has empowered females, providing them with a symbolic prop through which they can tacitly communicate their independence from social patriarchy. Overall, it is estimated that men (world-wide) smoke nearly five times as much as women.  While women’s smoking prevalence rates are currently lower than that of men, rates are projected to rise in many low- and- middle-income countries. Society has also become increasingly tolerant of women who smoke. In addition, women’s increasing economic resources represents a demand growth opportunity for cigarette companies, particularly in Sub Saharan Africa.  On the local front, BAT Zimbabwe offers brands that encompass different socio-economic classes and groups, and this allows it to maintain its customers even as disposable incomes shrink. Piggy notes that BAT Zimbabwe has traditionally been an interesting dividend-play on the Zimbabwe Stock Exchange (ZSE). The counter trades on a F2019F PER of 57.9x, which looks demanding. However, BAT Zimbabwe shares are tightly-held and this limits downside risks.

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