Tobacco Business

[ 58 ] TOBACCO BUSINESS [ SEPTEMBER / OCTOBER | 21 ] The COVID-19 pandemic, which shut down many brick-and-mortar stores and left consumers scrambling to find new ways of making pur- chases, gave rise to the subscription box craze. For a monthly or quarterly fee, consumers can subscribe to receive a special curated box of their preferred products that is delivered directly to their homes. There’s a sub- scription box for virtually every niche or hobby ranging from self-care and clothing to meats and even cigars. If you believe the subscription box industry is just a passing fad, you may want to take a look at the following statistics. The world we’re living in is changing—and so is how we’re making our purchases. According to reporting from CNBC last year, almost 12 percent of U.S. sales in April 2020 were from non-store purchases. Also in 2020, nearly 70 percent of consumers in the U.S. signed up for multiple subscription boxes. That is an increase from a figure provided by a 2019 USA Today report that stated just over 24 percent of consumers subscribed to a subscription box service. In 2018, the subscription box industry grew by 890 percent compared to the 10 percent it grew in 2017, according to CMSWire. Why are consumers flocking toward subscription boxes? Many people prefer being able to try a product in a sampler box format before fully committing to it, according to Emarketer. This would apply to cigar con- sumers who often find value in subscription box services that allow them to sample several cigars each month for a low price rather than having to buy an entire box of a particular release without knowing whether or not they would really want to smoke an entire box of a particular blend. For the cigar industry, subscription boxes can set brands up for future growth and opportunity. Consumers can be sent a cigar from a brand they would not normally purchase if they were shopping in a traditional brick-and-mortar store’s humidor. Creating that new customer and get- ting a cigar in their hands is a struggle that many brands often have. The cost associated with acquiring these new customers can also be lower for the manufacturers taking part in these subscription boxes. There’s no need to advertise, to host a cut-and-light event, to travel or to do anything other than to get one of their products included in one of these companies’ subscription boxes. These services are giving rise to a new generation of tobacconists—the ones that are just as passionate and invested in the category as those who have physical stores and who can help grow the industry by bringing in new customers that, for whatever reason, may not feel comfortable walking into a physical store and making a purchase on their own. For many, there’s a lot of mystery surrounding this new segment of tobacco retail despite its popularity and benefits. How does it work, how does it benefit the industry on a grand scale and how long will it last? To tackle some of these questions, Tobacco Business assembled a panel of tobacconists who are leading the charge of taking the subscription box business model and adapting it to a very traditional industry like the cigar industry. Panelists included Dave Imber, vice president of CigarClub; Chris Doyle and Ben Rotem, founders of Luxury Cigar Club; Alexander Berezowski, owner of My Cigar Pack; and Brian Desind, founder of Privada Cigar Club. These professionals share their insights into this emerging market and explain why their businesses are bringing new energy and customers to brick-and-mortar tobacconists everywhere. DAVE IMBER Vice President of CigarClub CHRIS DOYLE AND BEN ROTEM Founders of Luxury Cigar Club ALEXANDER BEREZOWSKI Owner of My Cigar Pack BRIAN DESIND Founder of Privada Cigar Club Meet Our Panel