sales of both premium and machine-made flavored cigars appear to

CATEGORYUPDATE
Among the seven different
versions of premium flavored
cigars offeled by General Gigar's
CAOare these thlee: Caramelo
Joe, Earth Nectar and Moontrance.
AND MACHINE-MADE
SALESOF BOTHPREMIUM
APPEARTO BE ROBUST
FLAVORED
CIGARS
By Mike Smith
ost of the cigars I write about are the regular rvith both premium and machine-madeversions.Many new
tobacco ones I cover in my column in this offerings areout there to replacethe vacuum left by the flavored
magazine.Every couple of years,I check in on the cigaretteban. Lots ofthe offeringsarearound cigarettesizeand
favored side of things. The banning of flavored cigarettes some evencome in a flip-top box. Note that unlike cigarettes,
toward the end of 2009 had many people worried thar it
theseproducts do not have 200 or so chemicalsin addition
might be the fate of flavored cigarsaswell, even though thev to the tobacco. They contain natural tobacco, with flavorings,
are a quite different animal.
with the sometimesexception of the wrapper which can be a
The FDA ban stipulated that these regulations n-right
homogenized tobacco and paper blend to facilitate
products
machine manufacturing.
also afrect flavored tobacco
other than cisarettes.
Many different companies are in the
According to their web site at fda.gov, "FDA is also
favored cigar businessthese days. On the
examining options for regulating both menthol
cigarettes and flavored tobacco products
premium side, there are CAO, Heavenly
other than cigarettes."So far, that hasn't
Cigar, the Miami Cigar Croup, Drew
g Estate,Torano, and Oliveros, to name a
happened and it's really converting
few of the more well known. Some are
part of that dead market into growth
For the flavored cisar market. To date,
more boutique or limited production like
there is every reasonto keep offering the
Gd's Cigars, Havana Honeys, Cojimar,
products, particularlv rvith its growth. If
Lars Tetens, and Bucanero. By far, the
you are cautious,stock for a shorter amount
largest number of selections and high
White
from
Swediah
Owl,
of time than you miehr ordinarily. Maybe
sales volumes are with the mass market,
Match, has found Elood
machine-made
varieties produced by such
you buy flavored products for a month's
suocess with its four
supply rather than a vear.
companiesasSwisherInternational, General
key fiavors as well as its
Sweets products.
Salesfor flavored ciears appear to be strong,
Cigar Company, Swedish Match, Altadis
CATEGORYUPDATE
The flavored cigars in CheYenne's
Body Shots and Derringierlines will
continue to be a Palt of the overall
$owth in the ciElarindustrY, the
company says.
and the Alria Company. The companies interviewed for this
article have indicated different levels ofpositive feedback for
the segment, ranging from stable to growing very strongly'
FlavoredGigiarBusiness "Strongl"
CAO was one of the first manufacturers to seriously
getting into premium, favored cigars.Their list of flavorsnow
i.r.lnd., Caramelo Joe, Cherrybomb, Moontrance, Eileenk
Dream, Gold Honey, Earth Nectar and Bella Vanilla. Dan
Carr President of General Cigar, tells us, "\7e are enjoying
increased demand acrossour entire flavored cigar franchise'
Our favored cigar businesscontinues to increaseprimarily
becausewe have the most unique and comprehensive favor
taste reducesthe barriers to entry for a given product, making
it more appealingto a wider rangeof consumers."
fu far as marketing their Havana Honeys line, Dan says,
"Regarding Havana Honeys, to capitalize on the social nature
of flavored cigars, we're taking Havana Honeys out of store,
to events acrossthe country. This includes music and wine
festivals,BBQ/grilling eventsand golf tournaments which we
often participate in, in cooperation with our retailers.This
allows us to bring the favored cigar experience to the casual
smoker and helps to drive consumersto retail."
As for the future of the segment, Dan tells us, "\fhile it's
difficult to speculate,the demand for flavored cigars is strong
and we anticipatethat this will continue.Justasthe traditional
the
premium cigar category faces regulatory challenges,
'We
as
favored cigarwill continue to sharesimilar challenges.
right
our
protect
to
continuing
to
are
committed
a company
to enjoy all premium cigars,through our support of industry
organizationssuch as the IPCPR and CRA, and through our
dedicatedteam of lobbyists."
New Flavors, New Packa$in$
Terryn Kinnev oi Heavenly Cigars tells us they now have
a lineuo of 10 flavors in 4 sizes,with 2 additional rotating
,."ron"l flavors.Ther-have iust revampedthe packagingand
brought out a brand nes' size.Shorry (4 x 40), in all flavors'
Their packagingchaneehasbeen*'ell receivedby the retailer,
as the box ii no..' a verrical lavout. saving shelf space'Their
favor nameshavechangedro refiectthe possibilin'thatFDA
will get their r,r'avon requirine name chanqesto eliminate
food names (like their tbrmer Heavenlr'\ anilla - norv called
Blu Thboo).
range in the industry."
After having exponential gros-th tor severalyears,Terry
He adds, "\fhen General Cigar took over CAO earlier
"Our business is steadv and consistent'
this year, we recognized that there is a unique segment of the says that now,
tbr smokersof all ages."fu
market that demands flavored cigars and we wanted to help Flavoredcigarsare nos' a market
goes
on to sa\''"Branding is key for
retailers to be successfulin this niche. \7e therefore opted to far as their Larketing. she
s'ell-known brand image to
take a price decreaseacrossour favored cigar portfollo. Ou1 us the HeavenlyAngels bring a
is key. Our colors allow
produ.t, are now competitively priced within the favored the consumers'minds. bur packaging
all other cigars,aswell as our
premium cigar segment and we attribute the recent growth of us to stand out in the cros'd of
beautiful new black boxes. Obviously, having a great cigar,
CAO Flavours to this initiative."
true to its favor descriprion is our ultimate mission!" fu to
favored
V4ren asked how the marketing was different for
-\bu
will now find that evencigar
cigars,he said,"Generallyspeaking,the favored cigarconsumer the olaceof favored cigars.
tanilla
from time to time. Flavored
a
llght
ur!
will
afi.i,o.t"dos
,h. favored cigar smoking occasion is different from
".rd
what you'll find traditionally within the premium
cigar category. As such, flavored cigars require a
unique approach to marketing, Demographically,
enjoyment of flavored cigars is more of a social
pleasurewhich appealsto a wide variety of adult
consumers. Through unique flavors and aromas,
flavored cigars offer a welcome change of pace to
the casual cigar smoker. To draw on a common
parallel between the premium cigar category and
ihe premium spirits industry, flavored cigarsmake
just asthe InteFcontinental Trading Go. recently introduced its line of oHM filtered
the tasteof the product more accessible'
same holds true for spirits like vodka. Accessible cigars in five llavors to the market.
CATEGORYUPDATE
Theseofferingsfrom HeavenlyCigals,includingRumand Gherry
Gherubsand a 20-countbox of BeeStinEls,are a small part of th6
successfuldiversilicationof tho industry,the companysays
cigarsare an important part of diversifyingin this market."
Tatiana has been making excellent favored premium cigars
for years. La Aurora in the Dominican Republic produces
them. In addition to the more complex Thtiana Mocha,
theret also a Thtiana favored cigar named \Waking Dream.
That one provides a different mist by using oak-barrel-aged
Dominican tobaccosinfused with herbs and flavorsof vanilla
cream, hazelnuts and single malt whisky. They definitely have
a place as a premium flavored cigar in many tobacco shops.
Drew Estate(JonathanDrew) hasa unique brand of cigars
perhaps best known by his Acid cigars.Theseare unlike any
others in that the different versions of the sticks are made
(secret sauce) with herbs and who knows what infusions.
They produce the very successful
Java cigar, infused mocha, cocoa
and java, for Rocky Patel. These
are in a class all their own and
continue to be very successfulas
high-end premiums.
Demand Should Keep
Growing
Shargio Patel, President of
Inter-Continental Tlading, told
us, "The future is looking bright
for flavored cigars. The demand
will always be there. Like I said
before, if the costs of cigarettes
keep rising, which I'm sure rhey
will, then the higher demand
for flavored cigars will grow that
much more. I am sure there will
be plenry more regulatory changes,
but the demand for flavored cigars
will never disappear."
He seesdemand increasins for
a d e f i n i t er e a s o n ", l n m y o p i i i o n ,
I believe the filtered cigar market is growing at a rapid rate.
Due to the high costsof cigarettes,a lot of people are turning
to filtered cigars as an alternative to savebundles of money. I
believe that the higher the costsofcigarettes are, rhe larger the
filtered cigar market will grow." ICT has recent new offerings
in this market. "\7e recently introduced our OHM Filtered
Cigars to the market. They are made in the USA. OHM
Filtered Cigars are made in five different favors (Red, BIue,
Menthol, Vanilla, and Cherry). Our cigarscome in hard fiptop boxes."
CEO of Cheyenne International, Bill Greiwe, says,
"Cheyenne is a leading manufacturer of cigars in America.
Our products include a full line of Cheyenne brand cigars as
well asDerringer and Bodyshot cigars. The flavored selections
are distinctive and formulated to meet the expanding desire
for choicesamong adult Americans in all products."
His thoughts on the future for flavored cigars are, "OTP
(Other Tobacco Products) in general will continue ro grow
and cigars as a whole will continue to be a meaningful part
of that and the favored cigar segment will be a part of that
growth. It is hard to predict regulation however the cigar
segment has been around a long time and I believe it will
continue to be with us for a long time." As to differences
in marketing for flavored cigars, "Effectively marketing cigar
products to your adult consumers is not that different than
other products, it requireseducating your salesforce so that
they can inform your customersabout the options available
to them."
Future Regulations Are Key
From more of a retail side of the house,Smoker Friendlyt
Mary Szarmach says, "The demand for flavored cigars
continues to increase,especiallysince the flavored cigarette
categoryis gone. I definitely think the
regulatory focus will be on flavored
cigars. The future growth of this
category hinges on future regulations."
She believes that, "Flavored cigars fill
the need of the American consumer. If
you look at soda,waters,tea and coffee,
liquor, candy, etc., the core lines have
exploded with flavors."
Brenda Fisher, National Sales
Manager for Lil Brown Smoke Shack
tells us, "I still seenew favored cigars
being introduced into the market
everyyearso the industry is increasing.
At our company, it is stable for the
moment, but we are stafting to see
an increase in demand for flavored
cigars." She describesher product as,
"Sweet Air is a lighdy favored vanilla
A&T Tobacco features extensive flavor selections
that
makesthe tastesmooth and mild."
in several ciglar lines such as Dark Horse, Hats Off
and Double Diamond,
On the marketing side of things, she
CATEGORYUPDATE
says, "I think flavored cigars give vendors more
opportunities to be creativewith visual marketing
tools." In addition to their SweetAir product, they
also sell a variety of other manufacturers' cigars
including Swisher,lffhite Owl & Game, Black &
Mild, Prime Time, SF Private Label, Al Capone,
Phillies, Dutch Master, Diarum and Dream.
One of the larger players is SwedishMatch' Brian
Love, the Marketing Director Mass Market Cigars,
for SwedishMatch, describestheir favored products,
"Our \7hite Owl brand which participates in the
Homogenized Tobacco Leaf (HTL) segment' focuseson four
lX/hite
key favors (Strawberry,Peach,Grape & \White Grape).
Grape is one of the fastestgrowing favors in the market and
features a distinguished green wrapper' \Vhite Owl also has
two Sweetproducts including the-White Owl Sweetsand new
popular'ffhite Owl Green Sweets. fu well, the brand has an
unfavored line of products. Two of the biggest frontmarks
are'White Owl Invincible & New Yorker. The Game brand
by Garcia yYegacompetes in the Natural Leaf segment and
has four flavors (Peach,\fine, \Vhite Grape & new Grape)
along with two unfavored products Game Green & Game
Palma. Our Garcia y Vega brand primarily concentrates on
the unfavored natural leaf segment."
Flavoredcigalillos,like these from White Owl' havebeenvery
successfulin the marketplace.
He also has a different view to the question of if the market
for favored cigars was growing, "The biggest definer to what
is growing or not growing is the size of the cigar rather than
favored or unflavored. Cigarillos style cigars in both Natural
Leaf and HTL are growing while larger cigars like Blunts and
Palmasare generally decreasing."
Theyhave abit ofadifference in theirmarketingaccordingly.
Brian says, "'W'e market our products to legal tobacco age
(LTA) consumers based on the individual brand strategy
'flavored' 'unfavored'
basis. Our \Vhite Owl
or
rather than on
brand contains both favored, sweet and unfavored products
within the line. LfA consumert affinity differs greatly from
Lil BrownSnoke Shackbline of VisionHunterflavoredfiltered
cigarsincludesEarthrWater'File and gweet Air.
geography to geography and thus we market our products to
meet LTA consumert demand for different product profile
(i.e. size, flavor/sweet/unflavored, NL/HTL) in each areaof
the country."
Enhancingthe Smokin$ ExPorlonee
The Swedish Match way of determining a new product
is also different, "New favors that are introduced to the
market need to sadsfr a real LTA consumer need rather than
'ne#
just be
or a novelry. They must enhance the smoking
'Sfhen
we pioneered \Vhite Grape back in 2007,
experience.
many industry panicipans thought that it was just another
'grape'
cigar. Vith our slow burning green wrapper and
complimentary white grape favor, the importance of this
flavor to both our company and rhe industry has continued
to gain sffength year over year."
Altadis (Imperial Tobacco) has dso been introducing new
flavored cigars over the last couple of years. The company's
Havana Sweets'range boasts honey and Irish cream favors.
Their Miami Suites line includes Amaretto, Honey, Honey
Berry, Irish Cream, and Rum. Their Dutch Masters Cigarillos
and Coronas lines have almost a dozen different favors. The
Phillies Blunts and Mini-blunc boast of half a dozen favors.
The cigarillos sizeofFerseven more. Theseare all in their massmarket division.
Swisher International is one of the largest producers of
machine-made flavored cigars, with their Swisher Sweets
brand including such favors as grape, wine, strawberry and
peach in cigarillo and mini-cigarillo sizes. They also offer
flavors in their Santa Fe, Optimo, Goodies, Blacftstone and
King Edward brands. Swisher'sJacksonville, Florida facility is
still the worldt largest cigar factory, producing more than 14
million cigars per day.
As always, as long as regulations dont prohibit it, the
customers will drive the markets. If youre not stocking a
selectionofflavored cigars,you arelikely missing a significantly
growing segment of the tobacco products business.If youre
watching the trends, you want to make sure your selections
lean toward the smaller sizesas that portion is also growing
for natural tobacco flavors as well as others. Listen to your
customers as any great retailer always does. TR