Charging Ahead Its Own Way

Black Buffalo forges its own path in the tobacco alternative space.

Charging Ahead Its Own Way

September 2023   minute read

By: Sara Counihan

We all have that product—the one we’re proud to show that we’re using, eating, drinking or otherwise engaged with. For a growing number of existing adult tobacco users who are at least 21 years old, the product they’re proud to leave on the bar top, kitchen counter or their vehicle cup holder is Black Buffalo.

If you haven’t heard of Black Buffalo, you’re about to. What began 11 years ago in a one-bedroom apartment in Chicago as nothing more than a PowerPoint presentation has exploded into one of the fastest-growing nicotine products in the country. The company currently has 6,500 locations that sell its alternative moist smokeless tobacco products, and that number is expected to reach 10,000 by the end of the year. In the summer of 2022, the number of locations selling the product was around 800.

“I think we’ve pulled off what a lot of people said for many years was not possible, which was that you just can’t replicate moist smokeless,” said Matt Hanson, chief growth officer, Black Buffalo.

A True Differentiator

The company’s moist smokeless tobacco (MST) alternative products are truly unique. All of them start with a variety of edible leaves in the cabbage family, and this plant species, when grown, harvested and processed according to Black Buffalo’s methods, behaves just like tobacco across every important dimension—texture, aroma, color, flavor—except that Black Buffalo’s leaves have no naturally occurring nicotine or unwanted compounds specific to the tobacco plant.

“We deliver the full MST experience just without the tobacco leaf or stem, and that includes the ritual, the tradition and the authenticity that goes with that experience,” said Hanson. “It has the same bold taste, aroma and pack, whether in a pinch or a pouch.”

Black Buffalo has been able to stand out among some of the most traditional and time-tested OTP brands not only because of what it’s made of but also because of its diverse lineup. The brand offers the traditional MST varieties in long cut and pouches, including wintergreen, mint, straight, peach and blood orange. They also have nicotine-free long cut and pouches.

“We live in the sweet spot that overlaps the best of what smokeless has and the best of what modern oral has, and we don’t bring anything to the table that people don’t want,” said Hanson.

That sweet spot has shone a light on Black Buffalo in an otherwise crowded back bar where innovation is scarce. However, offering products that break the mold can be a differentiating factor for retailers.

“Retailers have to evolve with the times. The MST consumer is actively seeking alternatives to traditional tobacco products for a variety of reasons,” said Hanson. “Adult consumers’ preferences are not cast in stone, and any business that keeps doing things the same way and not evolving to meet consumers’ changing demands is destined to suffer over the long term.”

In general, MST consumers are migrating away from traditional tobacco products, according to Hanson, which is evident in the unit declines in both the cigarette and smokeless subcategories over the past decade or more. There have been novel entrants into the category, including Black Buffalo, and there also has been a shift in societal norms surrounding modern oral nicotine use. There are now fewer places where it’s permissible to smoke and even use smokeless tobacco, which has pushed consumers to become poly-users, perhaps switching between nicotine pouches and cigarettes based on the setting. Or they’re changing their tobacco and/or nicotine products altogether.

“There’s a situational evolution of what’s considered acceptable in terms of tobacco and nicotine usage, which leads people to novel forms and functions like Black Buffalo,” said Hanson.

It’s also evident that consumers are growing weary of constant price increases that have plagued the category over the past few years, and this is where Black Buffalo makes another point of differentiation.

“Black Buffalo has always been positioned to be a premium product available wherever consumers want to buy at a fair price, and so while the rest of the industry seemingly takes price increases simply because they can, we’ve always sought to give our adult consumers a break,” said Hanson. “Black Buffalo has taken just one price increase in its entire company history.”

A True Partner

For the first six years of its life, was the only place customers could get their Black Buffalo products, and its online presence was initially how Luke McQuade, senior manager, merchandising, Pilot Company, found out about the company. McQuade stumbled upon Black Buffalo because he was personally looking for an alternative to traditional tobacco products.

“[Black Buffalo] places such a huge emphasis on being a quality product,” said McQuade. “And because I understood the product from a personal use standpoint, I believed that other Pilot customers that were like me must be looking for something similar.”

McQuade’s hunch was right. Pilot Company started off with a small fleet rollout of Black Buffalo, launching a six-product lineup across six states in July 2022, and because it was received so well by its customer base, Pilot launched the products company-wide in July 2023.

“It’s done better than we would’ve expected it to,” he said. “Black Buffalo is as invested in the success of their brand and the success of our brand as we are.”

According to Hanson, starting as a direct-to-consumer brand was a “very deliberate” approach.

“One of the things that we got out of that was a huge amount of first-party consumer data, which was very actionable,” he said. “We have precise information on what our adult consumers are buying, where they live, how frequently they buy their preferred form, do they buy in single can, two-can or five-can rolls, all that information we can use to drive those consumers to stores.”

Tim Greene, category director – tobacco & GM, Smoker Friendly, experienced this firsthand when his company decided to partner with Black Buffalo. Before its products even hit shelves, Black Buffalo told Smoker Friendly where the big pockets of its expected consumer demand were already located.

“That’s where we launched first, where they already had online customers,” said Greene. “They also found a price point that met the consumer’s needs, and both these factors led to an extremely successful launch.”

Black Buffalo also used its consumer data to set up Pilot’s initial launch for success. Black Buffalo was able to engage its customer base on in-store Pilot availability, down to the zip code, giving Pilot actionable inventory guidance and a ready-made audience of adult consumers seeking Black Buffalo products outside of the online channel.

“When we first did the rollout, we actually had people in a number of locations waiting for the truck to deliver the first load so they could purchase everything that came off the truck,” said McQuade.

Another benefit of being a digital-first company, according to Hanson, is the variety of brand and marketing capabilities Black Buffalo brings to a retail partnership. The company compliantly and responsibly creates awareness for age 21+ adult consumers via branded content, email marketing and paid media. All of which can potentially send traffic to brick-and-mortar and capture the art of storytelling in-store.

“This is a very powerful set of weapons in our arsenal that the major manufacturers don’t typically do or won’t do,” he said. “While they’re stuck in a world of analog signage, we’ve been digital first from day one, and that’s been extremely effective to drive adult consumer traffic in stores.”

McQuade says that he wouldn’t have rolled out Black Buffalo products company-wide had there not been a mutually beneficial relationship.

“They’ve been incredibly supportive. They help us resolve problems. They’re super active from a marketing standpoint,” he said. “They want us to be successful just like they want themselves to be successful, so the communications have been flawless.”

Said Hanson: “We don’t treat our retail partners as ATMs. We’re not there to just simply transact. We’re there to grow a brand and really enhance and grow the category responsibly with adult consumers seeking a true alternative to traditional tobacco products.”

A True Ritual

Black Buffalo first ventured into traditional retail in late 2021, and since then the company’s sales growth has skyrocketed. So much so that the company is currently building a 50,000-square-foot manufacturing and fulfillment facility in North Carolina.

“The facility will have effectively unlimited capacity for the foreseeable future to meet what has become overwhelming demand,” said Hanson. “It’s another example of how Black Buffalo is making thoughtful investments at the right time in the right place to continue to support sales at retail.”

Hanson believes the opening of the facility symbolizes Black Buffalo’s future longevity and staying power in the OTP category. It also shows how Black Buffalo is deeply rooted in the history of tobacco in America, as many tobacco farms, curing barns and processing facilities are traditionally located in North Carolina. Even though Black Buffalo doesn’t contain tobacco leaf or stem, its products are meant to emulate the best of what that plant offers, but in a modern oral nicotine product, says Hanson.

“The vision for Black Buffalo has always been to be the tobacco alternative of choice,” he said. “I think we’ve already proven that we are no longer considered an alternative, we’re now just part of the consideration set for adult consumers. In doing so, we’ve overwhelmingly demonstrated that there’s very much room for Black Buffalo as a brand of choice in the back bar.”

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