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Lounges of Distinction

Smoking lounges sponsored by cigar brands are opening virtually everywhere
Gregory Mottola
From the Print Edition:
Jim Nantz, May/June 2011

(continued from page 1)

The entrance to Club Macanudo in New York City, the original branded cigar lounge.
The entrance to Club Macanudo in New York City, the original branded cigar lounge.
Walls and walls of cigar lockers are occupied by celebrities and international clientele. Their engraved name plates are, in and of themselves, a form of endorsement, but General has also acknowledged the value of retrofitting and has branded a few small cigar shops as well. Nice Ash Cigars of Depew, New York, (a suburb of Buffalo) was the first "red dot" Cohiba branded lounge and Monte's Pueblo Pipe of Albuquerque, New Mexico, was christened the first Club La Gloria Cubana in 2009.

Swiss company Davidoff of Geneva, with its branded flagship stores and lounges in New York City, has a different retail history and unique relationship with its patrons. New York's general store manager Michael Herklots explains: "The Davidoff store in its origin was the finest tobacco shop of its time that sold only the finest products available in the most professional and helpful way. But it didn't sell Davidoff brand products because there weren't any. Buying the product was the experience."

As time went on, Davidoff cigars and accoutrements came to the market and are now an internationally recognized commodity sold in branded stores and to appointed merchants. Not all Davidoff stores have dedicated lounges. Some shops have only a seat or two while others are smoke free. The Davidoff shop in Manhattan's Columbus Circle has a lounge. [At the time of this writing, the Madison Avenue shop, which no longer allowed smoking, was moving to another location on Madison Avenue, which is slated to have a smoking lounge.]

Herklots calls such lounges a "win-win" for customers, but warns that a branded lounge can also create conflict with other brands. "Some companies might not want to host an event in another brand's lounge," he says. "It could get confusing, but that is up to the brand and the shop owner." Ultimately, Herklots maintains that a branded lounge, advertises the cigar "over and over," further driving home the impact, awareness and familiarity of the brand's name.

Like all business models, branded cigar lounges don't always work. Club Macanudos have been shut down in Chicago, Miami and Washington, DC; smoking bans forced a Montecristo lounge out of PNC Park in Pittsburgh; Bethesda's La Flor Dominicana Lounge is no more; and both Camacho and Gurkha had to pull support from two separate shops in Long Island.

Deloungings aside, the concept is thriving, especially as anti-smoking regulations leave cigar shops as one of few oases for cigar lovers. Retailers are benefiting from the relationship.

"As far as I can see, there's no downside for a retailer to open up a branded lounge," says Borysiewicz. "It's just a question of the right cigar companies partnering with the right cigar shops."

Florida tobacconist Abe Dababneh agrees. Half of his six Smoke Inn retail shops are branded Montecristo or Romeo y Julieta, including a 24-hour lounge. "It's been a very good relationship," he says. "There are certain obligations of our contract—we have to have certain facings and we can't have other branded paraphernalia—but they've been very good with their support. Having a branded lounge creates a clean, cohesive atmosphere and a nicer environment to smoke in."

Dababneh has no restrictions on how many cigar brands he can carry, but says a branded cigar lounge can sometimes influence purchases.

"In some of my shops, my customers are very savvy smokers and they know what they want," he says, "but in others, like our Montecristo lounge at the PGA National Resort, you get more transient smokers who aren't as sure, so naturally, they go right for Montecristo."

Perhaps that is an example of what marketing analysts call "buying the brand over the product." Of course, many cigar smokers like to think that they are purely quality-based consumers and therefore more immune to marketing. So, at the same time, it is also the job of the cigar brand to reinforce the discriminating smoker's perception of himself.

If there is in fact equity in a branded lounge, it isn't just through brand exposure alone, but through the association of experience. The customer has had an enjoyable, relaxing cigar, a communal smoke and a positive connection. Over time, he could conceivably come to associate the experience with the lounge's logo.Starbuck's chief executive officer Howard Schultz built his coffee empire on this very concept, and adopted the following mantra from his former advertising executive Scott Bedbury:

"A great brand raises the bar. It adds a greater sense of purpose to the experience, whether it's the challenge to do your best in sports and fitness, or the affirmation that the cup of coffee you're drinking really matters."

Or the cigar you're smoking.


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