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Smoking on the Strip

Las Vegas's cigar culture is booming, much to the delight of retailers and smokers
Michael Moretti
From the Print Edition:
Vegas, Mar/Apr 2006

(continued from page 1)

According to Arcella, casinos like The Venetian were not interested in standard cigar shops. Instead, they wanted established luxury tobacconists that would distinguish their properties from their competitors. Davidoff was the perfect fit. The company was world-renowned for its premium brand and had retail stores around the globe, including one on Madison Avenue in Manhattan.

The integration of cigars into Vegas culture is partly why it has avoided the smoking police. Cigars and Vegas have always gone hand in hand. Historical photos show cowboys chomping on cigars, gangsters puffing perfectos in front of Havana-inspired casinos, and tourists flocking to see stars of stage and screen. And people are still coming for the experience. While smoking has been banned in such major cities as New York, Boston, Los Angeles and Chicago, Las Vegas has nurtured the cigar scene. Cigar smoking is accepted almost everywhere, and tobacconists and kiosk humidors are mainstays on casino floors, perched beside art galleries, high-end shops and gourmet restaurants.

After selecting a Fuente Fuente OpusX from the Casa Fuente humidor, you can enjoy it with a libation at the full bar.
"I didn't foresee the scope of the antismoking legislation," says Frey, "but I knew Vegas was always going to be a place for cigars because it would be the last place on earth where they would outlaw smoking."

 

"It's a numbers game," admits Arcella. "Las Vegas gets the people here, and the more people the more cigars we sell." The numbers game is something that both Frey and Arcella have bet on and won with what they describe to be very generous odds. "Seventy to 80 percent of the customers have an average stay in Vegas of two and a half days," says Frey. "Every two and a half days you have a couple hundred thousand people changing over." On weekends, the Forum Shops alone have tracked anywhere from 100,000 to 200,000 people.

"There are 40 million visitors a year here," adds Arcella. "We have 50,000 people walk by the store a day. You may have that in our sister stores in New York, but it's the same 50,000 people. Here it turns over every two and a half days. "Every year since we've been in business we've grown on a same-store basis by double digits. There is a direct correlation between the success of Las Vegas and the success of the properties we're in. We're going to capture a certain percentage."

That the majority of customers are tourists is, of course, the main factor in the market's landscape. Most tobacconists around the country cultivate relationships with repeat customers. Casino stores, on the other hand, get two-day Vegas visitors in for five minutes and may never see them again. Frey and Arcella describe the overwhelming majority of their customers as "impulse buyers." "They say, 'Oh, I need two or three sticks,'" notes Frey. "My customer is going to the craps table and out to dinner grabbing cigars from kiosk stores or stand-alone humidors."

Capturing the attention of conventioneers, sports fans and bachelor partiers is vital for Vegas tobacconists, which is why cigar stores like Casa Fuente and Davidoff situate themselves in prime real estate to capitalize on the impulse dollar. "Location is everything," says Arcella. "We always want to make sure that we are in a prominent location in a reputable casino. We had opportunities to open stores in middle-of-the-road properties, but that's not the direction we want to move with Davidoff."

The cost of doing business in Las Vegas, however, is not cheap. "I probably pay a month in rent what other retailers pay in a year," says Frey about Casa Fuente. There's also a 30 percent tobacco tax in Nevada, so a lot of sticks have to be sold to cover expenses.

To get these cigars to be snapped up by the impulse dollar, cover the overhead and still make a profit, inventory is key. If a cigar isn't selling, it's wasting space and money and must be replaced with a brand that will sell. With as little as 60 facings and 200 to 300 square feet in which to put them in, the space in some shops is very competitive. Frey carries General, Fuente and Altadis cigars in nearly all his stores, as well as some smaller brands such as Ashton, La Flor Dominicana and Padrón. "What we carry are the people who advertise because people know it," says Frey. "They'll come in and say, Give me one of those 'Maóconódos,' because they can't say 'Macanudo.' People know the big brands, so that's what I'm forced to carry."


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