Tobacco Business

[ 94 ] TOBACCO BUSINESS [ MAY / JUNE | 21 ] I In today’s market, there’s always an ebb and flow action taking place, where popular products may see a decline for a period of time only to be revived and made popular once again. This has also been true for the gaming industry, with old franchises given new life as consoles improve; in fashion, with “retro” clothing coming back in style; and in music, with the resurgence of vinyl records and cassette tapes. This is also true for the tobacco industry, with pipes and pipe tobacco. “What is old today will become new again,” says Jorge Armenteros, founder of Tobacconist University (TU). “There is always a market for pipes and pipe tobaccos, so those that commit to the market will profit from it. I actually think that the rarity of the market makes it a valuable niche worth serving.” Tobacconists who are looking to add to their store’s bottom lines and are in search of the next best thing should consider looking into the past and reconsider the place pipes and pipe tobaccos have in their stores. A pipe is a very personal item that a smoker will spend many hours using, interacting and connecting with. Pipe smokers will spend much of their time holding their pipes, smoking their pipes, admiring each pipe’s unique aesthetic and function, and all of this makes the experience of smoking a pipe completely different from that of smoking a cigar or any other combustible tobacco product. Pipes can also be an expensive investment, offering additional margins for retailers but also calling for additional considerations in order to encourage a store’s customer base to make a transaction. In the interview that follows, Armenteros delves into the ins and outs of pipes and pipe tobacco, giving tobacconists some insights into this niche but highly profitable segment of the premium tobacco industry and offering tips for how you can maximize the potential of pipes in your community. Tobacco Business: Many tobacconists today are exclusively selling cigars. Why are pipes and pipe tobaccos important and relevant to the 21st century tobacconist? Jorge Armenteros: Well, from a business perspective, every sale and customer is important, so more is better. We estimate that pipes and tobaccos comprise approximately 5 percent of the luxury tobacco market, meaning many stores are failing to enter that market segment. On the upside, those that do sell pipes and tobaccos gain a larger share of the market since there are fewer competitors. Furthermore, at TU we take pride in the word “tobacconist,” defining it as an expert dealer in tobacco and the related accoutrements; this necessarily includes pipes and tobaccos. How do pipe tobacco customers typically differ from cigar customers? Pipes and pipe tobaccos and cigars are totally different forms of tobacco, grown differently, processed differently and consumed differently, so the customers—you guessed it—are very different. But there are similarities, such as a passion for tobacco, relaxation, and a love of the tastes and aromas provided by luxury tobacco. Pipes are an accoutrement, so they must be maintained and cared for. Also, there are many varieties of pipes suitable for different occasions and preferences. Similarly, pipe tobaccos run the gamut from smooth and sweet to robust, leathery and rustic. One of the most interesting differences between cigar and pipe customers is that pipe customers must invest in a pipe, and a great pipe can last a lifetime. So, pipe customers tend to spend a lot of time scrutinizing pipes before they purchase. It is not uncommon for customers to spend over an hour looking at pipes, analyzing them, feeling them, and then either buying them or deciding not to. Pipe customers need time and space to shop. Tobacconists can add profit to their bottom line by carrying pipes and pipe tobacco, a product category with a loyal and dedicated consumer following.