Innovation, pricing key to tobacco growth

Euromonitor International says innovating, raising prices and introducing smokeless products remain key growth strategies for tobacco companies as smokers worldwide face tax hikes, smoking bans, health concerns and social stigma.
The research firm says it expects nearly 7 percent more cigarettes to be sold annually by 2015, with increases in emerging markets. But it expects declines in places with greater tobacco control measures like the U.S. and Europe.

Prices are projected to rise 25 percent in that period.
Companies are looking to smokeless products and those with possible reduced health risks for growth. Revenue from smokeless products rose 11 percent in 2010 but remains small compared with cigarette revenue.
Euromonitor says rising prices will encourage illicit trade, which grew to about 10 percent of the cigarettes consumed in 2010.