Photo courtesy of Arango Cigar Company |
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FEATURE STORY
Here’s to the holidays
Give yourself the gift of more sales
By Melissa Niksic
Cohiba gift set with Xikar cutter.
Photo courtesy of Harold Levinson Associates, Inc. |
‘Tis the season for holiday shopping, and that signals the potential for a massive spike in sales for tobacco retailers. Many manufacturers are offering new products geared toward holiday shoppers and are hoping that retailers take advantage of every potential marketing opportunity.
According to Dennis Williams, national account manager at Harold Levinson Associates, Inc., premium cigars are just as popular as ever. Overall sales of standard cigar brands tend to increase during the holidays. Williams advises retailers to stock up on popular brands, such as Ashton and Romeo y Julieta, which tend to sell out quickly.
“If you know a brand is hard to find, it’s going to be even harder to get hold of around the holidays,” Williams says. “You really have to plan ahead.”
Many cigar manufacturers also offer limited edition cigar boxes during the holidays, which are popular among consumers.
“The premium pre-packaged cigars are the best sellers,” Williams says. “Usually the limited editions will be 10-packs, which makes them more affordable than the standard 25-packs. They also make a really nice gift.”
In recent years, cigar manufacturers have gotten more creative with holiday gift sets. Williams reports that one of the most popular products in 2005 was a Cohiba three-pack cigar gift set that came with a Xikar cutter.
Photo courtesy of Csonka Worldwide |
“We’re expecting that product to be a big seller again this year, especially because it’s been upgraded and now includes a better variety of cigars,” Williams says. The new Cohiba three-pack gift set will retail for $40.56.
Unique cigar products that are associated with a celebrity can usually be counted on to generate buzz during the holidays. Arango Cigar Company recently formed a relationship with Fittipaldi Cigars. Michael Gold, president of Arango, believes that Fittipaldi cigar gift sets will be popular holiday items this year. “Emerson Fittipaldi is a famous racecar driver who started his own premium cigar company,” Gold says. “The products are very cool to look at because they have a neat checkered flag logo.”
Cigar gift sets generally contain between three to 10 cigars and can range in price from $10 to $100.
In addition to cigars, tobacco accessories are also popular gift items during the holiday shopping season. Arango recently started offering the new Credo Synchro-Cutter, which Gold predicts will be a top-selling holiday item.
Hot Humidors |
Humidors and gift sets are hot holiday sellers and Altadis U.S.A. has a whole range of limited edition humidors available in limited numbers this fall. Each comes with a selection of its cigars. Choices include: the Trinidad Clock Humidor, the Montecristo Jefferson Memorial, Lincoln Memorial and Capital humidors, and the H. Upmann Tonsu Humidor. For more information, contact Janelle Rosenfeld at Altadis U.S.A.
Photos courtesy of Altadis U.S.A. |
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“What’s unique about this cigar cutter is that it has synchronized blades, which prevents a common problem among double-bladed cutters,” Gold says. “Most other cutters tend to pinch up against each other, crushing the cigar. This new product is an outstanding new piece of engineering.” The Credo Synchro-Cutter retails for about $60. Gold expects the item to be a hit with consumers who fall into a higher income bracket.
Other items that typically produce a spike in sales over the holidays are ashtrays, gift sets and humidors. Decorative ashtrays are extremely popular during the holiday season, as are larger ashtrays that are specially built to accommodate cigars rather than cigarettes, Gold says. Arango’s ashtrays retail from $10 to $50.
Gold says that Arango has always had a lot of success with humidor purchases around the holidays. He says that the key for retailers is to have a variety of humidors available.
“A lot of people already have humidors, so you need to give the shopper some variety,” Gold says. “One thing customers have been requesting a lot lately are travel humidors, so we’re offering one by Credo that’s been very popular.”
Travel humidors typically store six to eight cigars and are compact enough to slip into luggage or a briefcase. Arango’s selection ranges in price from $2 to $2,000.
“The $2,000 humidor is actually a large floor model ... basically a piece of furniture,” Gold says. A new limited edition of the luxury humidor is available each year, making each one an upscale collector’s item.
Personalized and logo-embossed gifts are also popular sellers during the holidays. Csonka Worldwide offers many customized products that are specifically designed to help retailers maximize their sales.
Michael Chunko, president and CEO of Csonka, says that the most popular personalized tobacco accessories are travel humidor cases, sport enthusiast lighters and air purifiers. For an additional fee that averages between $3 and $5, customers can have the products personally engraved.
“People want to be able to personalize,” Chunko says. “Buyers see that product in a whole new light when they realize it can be customized like that. It’s so different from a generic gift that you can rush out and get during your lunch hour. The laser engraving adds a much more personal touch.”
Csonka offers several different styles of each customizable product, which Chunko says is the key to retailers’ success.
“Buyers have a wide range of price needs and people that they’re shopping for,” he says. “The more a retailer can offer the consumers in a range of prices, the more the retailer will sell.”
Photo courtesy of Arango Cigar Company |
He notes that personalized gift items are also popular among businesses, a hot target for holiday marketing efforts. “There are some businesses that will literally spend thousands, sometimes hundreds of thousands of dollars on customized gifts,” Chunko says. “They are desperate for new ideas, which is why we offer so many different engravable products.”
Csonka’s products vary in cost, with the average retail price being between $20 and $100. However, the company also is known for its world-class products that are popular with upscale shoppers around the holidays.
“We offer an excellent digital humidification device, the CigarSpa Automatic Humidification System, which retails for about $400,” Csonka says. “That’s usually too expensive for most retailers to keep in stock, but they can always order it.”
So what steps can retailers take to maximize profits during the holidays?
“You have to have a visual approach,” Gold says. “Customers are very visual. Retailers should set up a special table at the front of the store, something that isn’t up during the rest of the year. The table should feature an assortment of new products ... maybe even a Christmas tree for decoration. It needs to draw people’s attention.”
Chunko believes that the key to a successful holiday season for retailers is offering innovative items and a diverse selection in terms of price and variety. “Holiday consumers are always looking to give what’s new: an innovative lighter, a neat travel humidor, etc.,” he says. “It has to be something that will take their spouse’s or friend’s love of cigars to the next level.”
Williams agrees. “Manufacturers have a broad range of stuff out there,” he says. “Retailers really need to jump on it.”
Photo courtesy of Csonka Worldwide |
The holiday shopping season provides retailers with plenty of additional marketing potential. Consumers are on the lookout for that “perfect gift,” and tobacco retailers need to capitalize on that opportunity.
Chunko thinks retailers need to approach the holiday shopping season from a fresh marketing perspective. He believes that retailers often focus too much on their current customers rather than thinking of ways to attract new shoppers.
“Retailers should inquire about other potential buyers,” Chunko says. “Everyone in your town or region is a possible customer, and retailers need to make an effort to reach out to that group.”
E-mails, signage and newspaper advertisements are all ways for retailers to connect with possible customers. Chunko advises using these marketing tools to promote new or relatively unknown aspects of tobacco stores.
“Only about 25 percent of people smoke cigars and cigarettes, and retailers should make an effort to promote products that nonsmokers, who make up 75 percent of the market, can use,” Chunko says. “If you’re a tobacco store, people know you sell tobacco products. But why not highlight other items, like air purifiers and odor eliminator products that will appeal to smokers and non-smokers alike?” Csonka, for instance, offers three different styles of engravable air purifiers which accommodate a variety of budgets. They retail for between $20 and $50.
Tobacco retailers should also make an effort to market and sell products that they don’t typically keep in inventory.
“Just because you don’t have an item in stock doesn’t mean you can’t order it quickly from manufacturers,” Chunko says. He advises keeping detailed product specifications and photos on hand so that they are easily accessible when customers start asking questions.
Perhaps the best advice for tobacco retailers is simply to plan ahead. Williams advises retailers to place their orders early and have all holiday items on display by Thanksgiving.
“If you put everything out sooner, it’ll give customers a few extra weeks to notice the product and think, ‘That would make a really nice gift!’” he says. “Plus, retailers can always sell out early and have the option of re-ordering if sales shoot through the roof. A lot of people tend to think of cigars as good last-minute gift items, so they’ll be flying off the shelves until the very end.” |
