Navigating the Sea of Sameness : Exploring Product Differentiation Strategies within the Swedish Nicotine Pouch Market

In light of the exponential growth of the nicotine pouch industry, major tobacco-industry players have shown increasing interest in newer nicotine and tobacco products, despite the lack of discernible differences them. Therefore, this study aims to investigate the differentiation strategies of companies within the Swedish nicotine pouch market, and further, the long-term competitiveness of these strategies. The study has applied an abductive and qualitative method to interpret non-numerical data of 14 companies through a document analysis, complemented by two semi-structured interviews. Empirical findings have been analysed using a conceptual model based on previous theories and research on product differentiation. The thesis identified five traditional, alongside three industry-specific modes of differentiation apparent within the market. Primarily, companies differentiate through branding and marketing, adaptiveness, health advocacy and sustainable branding. Interestingly, besides flavour innovation, technology and innovation-driven differentiation is less common within the industry. Most strategies identified within the market are, however, easily imitable, and therefore not competitive long- term. Ultimately, findings suggest the industry is at a crossroads: Consumers currently hold a significant amount of power with a variety of options and little to nothing swaying them in one direction or the other.