BIG INTERVIEW
PATRICK GANGULY
27 JUNE 2025 ASIAN TRADER 19
how do we enforce it within the market?
Because if we cut the supply off at our borders
and then continue to enforce that in the
retail, that’s how it’s going to work.”
“We employ a full-time anti-illicit trade
manager who’s working with the trade and
industry,” Patrick says. ““He deals a lot with
enforcement agencies, helping them in
authenticating products and passing on
information around illegal selling.”.”
Apparently the post-COVID inflation
had a huge impact on consumer behaviour.
“The UK excise model is RPI plus two per
cent. When our inflation was nine per cent
and 11 per cent the tax prices were crazy.”
Again, it’s a case of Government policy
helping to grow the black market and foster
international criminal gangs.
“In summary,” says Patrick, “it’s an
evolving journey. We need to continue to
work with the Government, wherever the
Government chooses to listen to the
information that we continue to provide,
and in the meantime our role fundamen
tally remains to serve our consumers, and
we do that through the network of retailers
that we have in this country.”
Voyaging onward
With so much ill-thought-through and
under-consulted legislation rumbling and
flashing on the horizon, the ship of the
nicotine sector still appears to be well-
braced – “a third above the beams, Cap’n,
and prettily trimmed fore and aft”. Yet there
is nervousness about the onrushing storm
of new laws, and a feeling that it’s time to
man the yards and pull in the foresails
before the angry waves swell and break
against the hull.
If so, what sort of tack will Imperial
Brands be taking? Putting out or pulling in
the sheets? I ask the skipper. Steady as she
goes, is the answer.
“First of all, Imperial has been in the UK
for the last 124 years,” Patrick explains. “We
opened our doors in 1901, and we talk about
evolution. Imperial has been through a
constant and consistent evolution, even
though the industry has changed.
He draws an analogy, not with sailing but
the music industry – how we used to listen
to vinyl discs and now it’s all Spotify – but
still music: evolution, see?
“The way we listen to music is different,
and that’s exactly what we’ve been doing
with tobacco,” he says. “Sure, consumers
still want certain combustibles, and we will
serve that demand, but we are moving into
different, next generation products.”
It’s especially in next gen where the
hopes of the convenience channel reside.
Retailers know that’s where they have the
edge over the multiples because people
don’t just pick something off a shelf. They’re
coming for advice and education, and the
retailer will talk to them about changing
from tobacco to vapes or something else, so
that there is a crucial relationship only this
channel has established.
“You’ve got 40,000 independent
retailers in the UK,” Patrick begins, “and
they sell our products across the multi
category. They turn up, they open their
doors every day to serve their community
and their customers, and we turn up
supporting them, through our reps, through
our product offerings, through furnitures, if
and when required. But ultimately, we see
our relationship with them not as some
thing we need to do today. That’s always
been there, and it will always continue to be
there – because one of the biggest ways inde
pendent retailers add value to our business
is that they are able to engage with our core
consumer. The retailers tell us what’s
working and what’s not – and we need to be
able to listen to them and act on that.”
And what’s working certainly seems to
be Imperial Brands’ fabulously successful
– even category-defining – blu pod system.
The company, though, has so far steered
clear of other next gen innovations (at least
in the UK market) such as heated tobacco
devices and of course this year’s big trend,
nicotine pouches.
“We’ve recently done research on
nicotine pouches, or OND, ‘oral nicotine
delivery’, and we do see a trend in there. But
there are currently no regulations in this
sector. There’s many different people trying
to sell it, and some of our competitors are
into it. I think what we need to look at is
when is the right timing for us, with what
proposition and at what margins,” Patrick
explains.
“That’s the strategy I’m trying to bring
into the heart of Imperial Brands in the UK
– where it’s not just about running after
something but being very clear about what
we stand for. Because I believe, unless we
are clear for what we stand for, we will fall
forever.”
I remark that it seems Imperial has a good
anchor in heritage, just as other brands
(Jaguar, cough, cough) are trying to get rid of
theirs. Indeed, it seems there’s a big space
for someone to go in and say, Actually, we’ve
been here a long time. We’re evolving. We
have these products. We’re sticking with
them.
“It’s a tested and proven strategy. I think
it’s really important to recognize that we’ve
been doing this for 124 years. Of course, we
didn’t get it right all the time, but I think we
got it right more times than wrong. That’s
why we’re still here, and heritage is quite
important to me. It’s a part of my culture.
It’s part of my upbringing. Respect, heritage
and humility is what makes us who we are”
And the new legislation?
“I know it sounds quite boring,” Patrick
concludes,” but reasonable regulation that
can be backed by enforcement and can be
physically implemented is what is required,
and I choose to remain optimistic!”
Heritage is important to me. It’s a
part of my culture. It’s part of my
upbringing. Respect, heritage and
humility is what makes us who we are.
I come from
Australia. If you
see the situation
there, you will see
that it’s out of
control.