Tobacco Business

[ 60 ] TOBACCO BUSINESS [ SEPTEMBER / OCTOBER | 21 ] Tobacco Business : From a business perspective, what appealed to you and others involved with your business about the monthly subscription box model? Alexander Berezowski: I became captivated by the subscription model in 2012. I did a research paper on subscription models for a business associate degree class I was taking and started working on ideas around that time. I developed a model that wasn’t supported and brought it to life through cigars six years later down the road. Brian Desind: At one point, I had to move to Los Angeles. I went from living in a 6,000-square-foot home to one that was 750 square feet. I had no choice but to sell some of my cigar collection. Turns out that not a lot of people understood the ap- peal of limited-release cigars, and, furthermore, no one wanted to pay a lot for aged cigars. The idea for a subscription [box] came about be- cause I wanted to educate people on what made these limited and aged cigars so special. I made three-packs of three cigars. I wrote about them, paired them and did full reviews with tasting notes. No one joined. No one cared! That was in Novem- ber of 2017. Around early March of 2018 I got a call from Rob Gagner at Boveda. He asked if he could unbox my failing cigar subscription on his channel. I honestly thought he just wanted free cigars. Rob did his thing, and next thing you know I went from 15 to 50 members over- night. Then came Bryan Glynn of Cigar Obsession and Delicia Silivia of Cigar Vixen. If not for those three influencers and Instagram user @leemack912, Privada Cigar Club would not exist. Chris Doyle: Some of our favorite things to do are experiencing new things and collecting the things we love. We wanted a way to share this experience with more people, so naturally the subscrip- tion model made sense. We are able to explore ourselves and have those that are in our club explore with us. The challenge to excite our members every month over and over again, although extremely difficult, is one of the most rewarding things about what we do. Dave Imber: The monthly subscription model allows for some amazing experiences. For one, we have the ability to share amazing brands a consumer might not pick up at their local shop. We also have thousands of Excel [spreadsheet] rows filled with data on what our members are liking and what they are not liking. That allows us to select brands and cigars that they will enjoy, so it’s not just a ran- dom sampler of five cigars. We are a true curated experience. Some would argue that cigar subscription services are competing with traditional brick-and-mortar retailers. How do you feel about this? Imber: I disagree. At CigarClub, we know we are part of our cus- tomers’ cigar journey. Most of our members smoke more than three or five cigars a month. We take pride in introducing them to new brands, countries and blends. From there, many of them go to their shops to buy more of something that they had in our box. Doyle: We believe that without the brick-and-mortar backbone, the whole cigar industry as we know it would fail. While we offer another way for consumers to purchase ci- gars, we find that we do not replace a brick-and-mortar retailer. First off, everyone has a different prod- uct line that they offer. We know for certain that the modern consumer likes variety. Secondly, often our members receive a cigar they like [in their subscription box] and seek that cigar out in their local brick- and-mortar retailer. Within Luxury Cigar, we have created a program for brick-and-mortars called the Preferred Retailer Program or PRP. Through this program we offer ci- gars that are made exclusively for us to a network of brick-and-mortar stores. We created this program to help support brick-and-mortar sales by directing our members to them and to show how important it is to us that these brick-and- mortars maintain their success. Berezowski: Cigar subscription services have existed for many years, primarily found on the sites of big online retail companies that gradually influence their sales through their aggressive discounting practices. A select group of individuals have focused on competitive- ly transforming this niche into a truly disruptive one that specializes in different areas that provide merit and relevancy to the brands that brick-and-mortars sell. Data and general awareness demonstrate that the “cigar subscription” effect is positively impactful for these brick-and-mortars, as the featured products metamorphose into a higher demand for them, and these services are the ones develop- ing new platforms and strategies to satisfy their consumers’ needs through wholesale supplies and programs that provide them access to these products. Desind: Let me say this: Without brick-and-mortar shops, there is no cigar culture. Privada supports brick-and-mortar through our Lim- ited Cigar Association (LCA). Each month, we create, manufacture,