Increasingly frustrated in their dealings with government, the one ray of light for tobacco manufacturers is category performance.

Despite a 1.7% fall in the volume of cigarettes sold, equating to 632 million fewer actual sticks, the category is up 3.8% by value. The significant fall in sales of sticks is not due to government attempts to reduce smoking, but rather cash-strapped smokers continuing to trade down to roll-your-own tobacco (RYO), sales of which soared 19.5% to £1.14bn.

Overall sales were also boosted by a fall in smuggled tobacco and legitimate tobacco brought in from abroad, though manufacturers warn this could be a short-term gain with the mooted display ban.

The picture on the key cigarette brands front is mixed. Although the category as a whole is in growth, only 10 of the 25 leading brands have increased sales this year.

The key trend across the category, reflected by RYO growth, is economising. Most growth has come from mid-priced and economy brands, with premium brands struggling to maintain growth.

Imperial Tobacco's Lambert & Butler King Size remains by some distance the UK's favourite smoke. While L&B sales are up just 0.6% this year, at £1.4bn they are nearly double that of nearest rival JTI's Mayfair King Size. Imperial can also claim the category's biggest success story, thanks to soaring sales of its John Player Special Blue packs. The low-priced brand, launched two years ago, has had a huge impact on the market thanks to Imperial's focus on securing better distribution. JPS Blue sales are up 173.1% this year, from £76.7m to £209.4m, making it the 17th-biggest cigarette brand in the UK last year it was at number 30.

Rival JTI also recorded strong growth in the mid to low-priced market. Nisa-Today's business manager Paul Batchelor says the overall growth of the category "is really quite significant when the downtrading to less expensive economy brands is taken into consideration".

Launch of the Year: Winston (JTI)
In a market in which suppliers have their hands firmly tied behind their backs in terms of normal marketing support for the launch of a new product, it is hardly surprising that there has been limited NPD in the tobacco category this year.

It's also unsurprising that JTI went for a successful global brand to add new impetus to the sector, with the national launch of its Winston brand in July. As one of the world's biggest cigarette brands it has instant consumer recognition and, at just £4.79 for a pack of 20, it taps into the key trend towards budget brands.

Top Products Survey 2010