For the third year in a row, we are providing a full “Post-Game Report” assessing the IPCPR Convention and Trade Show. In this report, we talk more about the show itself and give our thoughts and impacts to the cigar industry.
This won’t put a close to the 2017 IPCPR coverage. We still have more of our product-centric coverage that will continue over the next few weeks.
From the Show Floor
If there was a theme of this year’s show it was packaging changes. Many companies chose the 2017 IPCPR Trade Show to introduce new packaging – whether it was bands or boxes.
There were two driving factors to this. The first dealt with warning label requirements that were due to the FDA on August 10th, 2017. In particular, box design changes were needed on many brands in order to comply with the regulation.
The second reason is a concern that packaging changes might need FDA approval in the future. When the Deeming Rules came out, it was assumed that no new packaging changes would be allowed. But about a year ago, a court ruled that labeling changes do not constitute a product change. However, some brand owners told me they are concerned that if this ends up back in court, the ruling could go against packaging changes being allowed. Therefore, there was a feeling that any planned packaging changes should be done sooner rather than later.
“The Story” – Plasencia
The biggest story at this year’s Trade Show was the arrival of the Plasencias as a brand exhibitor.
The Plasencias have 152 years experience in the cigar business and truly are one of the iconic families in the industry’s history. After many years being growers and producing cigars for others in the cigar business, the Plasencias launched their own brand. It’s not just a brand with their name on it. To bring this product to market, the Plasencias now have their own U.S. distribution company, Plasencia 1865, LLC. At the 2017 IPCPR, the Plasencias would be exhibitors for the first time – and they had a full-blown media event for the official launch of their brand.
Few cigar companies are big enough to do such a launch, but for those that are, Plasencia’s event could serve as a blueprint to how to launch a cigar brand at a trade show. The 2017 IPCPR Trade Show will be remembered as the first trade show the Plasencias exhibited at.
Not a Huge Year for Stealth Product
In case you missed it, here is our definition of Stealth Product:
A stealth product is a cigar that has had virtually no marketing and for the most part has been sight unseen before arriving at a retail cigar establishment. While this is not an entirely new concept to the cigar industry, stealth products showed up frequently in August 2016 – more than any time in the history of the U.S. premium cigar business. In most cases, the company who shipped the stealth product refuses to even acknowledge its existence.
There is one common thread about the recent swarm of these stealth products: they were sold, invoiced, and shipped to retailers all before August 8th, 2016 – the date when the Deeming Regulations took effect. Any cigar released from August 8th and beyond must get regulatory approval from the FDA.
We were told by a host of cigar companies that they released a large amount of SKUs prior to August 8th. Some, like La Palina and Rocky Patel, were up front about it. I’ve been critical of the many companies which have been clandestine about these releases.
I didn’t see as large of an amount of product previously released as stealth at the trade show as I was expecting. This surprised me because, at that time, the pre-market approval date to keep these products on the market was August 8, 2018. So I expected more products to be on display. I realize it takes time and money to bring a product to market – and many companies simply don’t have that kind of resources to bring everything to market. I also get the fact that companies would want to stagger these releases. On the other hand, I would think with a short window, we would have seen more previously “stealth” products showcased.
I believe that some companies rolled the dice, hoping the 2018 premarket approval date would be moved, and they would have more time to get products to market. This did occur, but it was on July 28, 2017 – after the IPCPR Trade Show closed. If that was their strategy, it was a gamble that paid off.
Less Product Innovation
While there still was enough new product to keep most attendees interested in the trade show, it was a bit flat from an innovation standpoint. This can be attributed to the ongoing implementation of FDA regulations on the premium cigar industry.
There were some highlights: including Espinosa Reggae and DREAD (Jamaican Tobacco), CAO Amazon Trilogy (rare Brazilian tobacco), Drew Estate Florida Sun Grown (although that had already been launched), and Davidoff’s barrel aging (again, that had already been launched). However, for the most part, the trade show highlighted more Ecuadorian Habano and San Andres wrapped blends than I cared for.
I will stick to my promise this time. There is no point in discussing attendance numbers given the fact that sales numbers will never be disclosed.
But I’d like to note that I heard several people make an assumption that the amount of traffic at a booth correlated to the amount of new product released. I don’t agree. There were companies such as RoMa Craft Tobac and JRE Tobacco Company, which did not release new product and were still among the busiest booths at the show. My feeling is the blueprint is there to have a successful IPCPR Trade Show without showcasing new product. It’s about connecting with your consumers 365 days a year – and both of these are examples of companies that are doing so.
The Impact of the TAA
I heard this from several manufacturers who do not go to the annual Tobacconists Association of America Convention (TAA) and Trade Show. These manufacturers all felt the TAA was putting the squeeze on doing business at the IPCPR Trade Show.
The TAA retailers represent a powerful segment of the buying power of the retailers. Each year at the TAA conference, there is an opportunity for these retailers to make large volume purchases at a substantial discount. Not every manufacturer or brand goes to the TAA. Those who do not go told me that they believe the large volume purchases are impacting the annual budgets of many of these retailers going into IPCPR. As a result, they feel it is impacting sales at the IPCPR Trade Show.
Without quantifiable sales numbers, it’s hard to validate this, but one thing I can say is this perception is out there.
Online media: Who Was There, Who Wasn’t
This year, several media brands were not at the Trade Show. We didn’t see Stogie Guys, Toasted Foot, Leaf Enthusiast, KMA Talk Radio, or even my old brand Stogie Geeks.
This year we saw Developing Palates, Smooth Draws Radio, Average Joe’s Cigar, Blind Man’s Puff, The Cigar Authority, Cigar Craig, Cigar Dojo, Cigar Federation, Cigar Vixen, Developing Palates, iRobusto, Halfwheel, and Stogie Review.
We commented on Cigar Dave’s absence last year. He was back this year, but gone was the elaborate ESPN style studio he had previously. His coverage seemed to be following the lead set by Stogie Review and Cigar Federation, but focused on the larger companies.
Coverage as a Whole
Overall, I give the media a solid grade on covering the trade show. There are three areas where I think improvement can be made.
- More Written Coverage: I still think there is something valuable in written coverage. There is still a lot of power in the written word. However, much of online media continues to move into the video realm.
- “Be the Lime Video Coverage”: Be the Lime is a book written by Fred Rewey of Nomad Cigar Company that talks about techniques which help to make your brand stand out. Over the years, Stogie Review and Cigar Federation have done video coverage and seem to do the best job in making their brands stand out in terms of video coverage. These brands have consistently captured the vibe of the show year after year. The two-minute infomercial video coverage hasn’t cut it for me – and I’m not sure about the return on investment. Video coverage is much more resource-intensive and costly – and I’d hate to see media brands not return next year because they think they must provide video which won’t give a good return on their investment. To make the two-minute video infomercial work, it needs to be tied to something unique or significant written content.
- More Larger Company Coverage: While General, Altadis, Drew Estate, and Davidoff had their share of media coverage, it seems that booths of other larger companies like Arturo Fuente, J.C. Newman, Perdomo, Oliva, My Father, and Padrón had very little coverage from many online media brands. While I think it’s fair to note that General, Altadis, and Davidoff have dedicated PR/media teams, I don’t think that should exclude some of the other brands. I’ve heard various reasons for this, but I’d encourage online media to keep knocking on the door. Even if companies don’t have new product, it could lead to the opportunity to build relationships.
Mayor Rudy Giuliani was perhaps the biggest name to attend IPCPR in a long time. I saw articles by Cigar Aficionado and Tobacco Business Magazine. Other than that, when it came to online cigar media, there was very little coverage other than a few social media posts.
While I get a lot of online media doesn’t cover legislation, I still was surprised not to see more mention of Giuliani by online media.
Assessing Our Coverage
Earlier this month, we highlighted our coverage on what worked and what didn’t. This was a challenging trade show for Cigar Coop to cover, and we have areas we need to address to better improve our quality of coverage.
Monday Morning Quarterback (MMQB)
I’ve said it before. Nobody takes a more unfair pounding than the IPCPR. When it comes to the Trade Show, I do feel IPCPR has done very good job. A switch in locations late in the game was not easy, and given the short window, the organization responded quite well. But this show has a problem – getting people energized about the Trade Show again.
I think, conceptually, IPCPR has the right idea that the convention needs to be thought of as more than a trade show. In addition, I think they have the right idea turning the convention into an “event”, but there probably is more work to be done.
Change in Venue
As for the Las Vegas Convention Center, I found it to be a good facility. The layout of the trade show floor was good. I also liked the fact that parking was quite close to the convention center – making it easy for those of us who had cars.
There were numerous complaints about the host hotel, the Westgate. I stayed at an off the Las Vegas Strip location, so it’s unfair for me to comment here. All I can say here is it’s probably something IPCPR needs to address.
While it will be back in the Las Vegas Convention Center for 2018, IPCPR has been surveying members to see where they would like future iterations of the trade show. The choices have been Las Vegas, Orlando, and New Orleans. While personally, I would prefer the show in Orlando, it needs to make good business sense as a location to host the show. No matter what, there will be people upset. I’ve noted smoking in Las Vegas is becoming more difficult. While it’s not at a critical point like New Orleans, it’s good that the IPCPR has other options to consider.
The Gala and Cigar Bash Worked
There was no doubt, the opening gala was a huge improvement. The event had plenty of food and drink available. General Cigar did a great job at making this more than a cocktail reception. I thought it was a stroke of brilliance to launch the new Macanudo Inspirado White and Macanudo Inspirado Black lines at the gala. Little things like a T-Shirt station made the opening gala a little more fun.
While I did not attend the Cigar Bash featuring a concert by 38 Special, all reports I heard from attendees was that this was an enjoyable event.
Whether you liked Giuliani’s speech or not, the IPCPR deserves a huge amount of credit for going out there and getting an “A” list name to be the keynote speaker. Other than some scheduling issues (see “Scheduling” below), IPCPR did a good job here (and I don’t even like breakfast).
In my opinion, Giuliani’s speech should have been recorded and made available to all IPCPR members in good standing (see “Make Keynotes and Educational Content Available”).
Self Produced Content
If you want to re-energize your base about coming back to the trade show, my recommendation here is to show the people at home what they are missing, and I believe this can be accomplished with a combination of live video and recorded content. As I mentioned, there has been an abundance of video content by cigar media. However, I think it’s more powerful when the trade association produces its own content. In the end, I think there need to be more reports from the trade show floor from the IPCPR rather than the independent cigar media.
Here are some good examples of content provided directly from the association sponsoring the trade show and convention.
- National Cattleman’s Beef Association Convention
- NATM (National Association of Trailer Manufacturers ) Convention & Trade Show
- Global Pet Expo 2016 Day 1
- NECA (National Electrical Contractors Association) 2008 Chicago Convention and Trade Show
- SEMA (Specialty Equipment Market Association) Trade Show
Make Keynotes and Educational Content Available
I would make all of the recorded content available to members, and in select cases, the public. The IPCPR has done a great job at improving its educational seminars. A member should not be excluded from the content just because they were not at the trade show.
In some cases, I think it makes sense to make content generally available. No matter what you thought of Rudy Giuliani’s speech, the video should be out there. It should be easy to find as well.
This was the schedule for this year’s IPCPR:
Day 1: 10:30 AM – 5:00 PM: Trade Show Opens with early 9:30 AM access to those who make PAC Donations
Day 2: 10:00AM – 5:00 PM
Day 3: 10:00AM – 5:00 PM
Day 4: 9:00AM – 1:00 PM
The subject of changing the schedule came up on the Developing Palates IPCPR Recap Show. The time has come to look at changing the schedule. I believe this can help with re-energizing the trade show.
First up, make the Trade Show a full 8-hour business day. I suggest opening the doors at 9am and going till 5pm. I’d even advocate for an 8am or 8:30am start time, but I do realize that would be hard on the exhibitors who have to set up and close down each day.
From a media standpoint, we need a lengthier business day. To have more complete coverage, we need more time. While we could invest in more resources, this comes at a cost. An extra hour or so each day would also help retailers who want an earlier start to the day, while at the same time allowing those who want to come later to do so.
The early PAC access to the show needs to change. The show used to open on Day 1 at 10am for everyone. Now, time is being taken away from those who don’t make a donation. At the same time, I feel there are better ways you can reward those who make a PAC donation. Maybe things such as expedited check in, premium seating at the keynote breakfast, or a VIP lunch area. For media, we have lost time on Day 1 unless we make a donation. Lost time means less coverage. While I realize the money is for a cause, media should not have to pay extra to have full access to cover IPCPR. In general, I think eliminating the early PAC fee will eliminate some of the “politics” that frustrate many IPCPR members.
Finally, the scheduling of Day 1 was a problem. This year, Mayor Rudy Giuliani’s keynote address overlapped with the 9:30am PAC access. Many who had paid $100 to get into the show early had to leave Giuliani’s speech before it concluded. I think in the future this should be fixed if another high-caliber speaker comes in.
The Predictions for Five Hottest Cigars
For the past five years, predictions for the five hottest cigars have been made. Here is where we look and see how things stacked up.
While I’m not sure the chatter about La Volcada led the pack during the trade show, my gut feeling tells me this cigar did very well in sales – and it’s probably going to be one of those cigars that gets a huge spike in buzz once it arrives in stores. La Flor Dominicana fans are some of the most passionate out there, and it’s hard for me not to see a big spike.
In hindsight, we got the brand right but the cigar wrong, for #2. Here the pick was Matt Booth and Robert Caldwell’s The Truth. In reality, it was Hit & Run that was the hotter cigar. This was a cigar that was ready in its packaging. Plus I think since The Truth needs to be renamed, that went against it. At the same time, I feel the Booth/Caldwell connection made a significant impact. Don’t get me wrong, the cigar formally known as The Truth will be a big hit once it hits stores.
Steve Saka’s Dunbarton Tobacco and Trust Todos Las Dias might have been the big winner here. The more I hear about it, the more I think this might be the most talked about cigar at the show. It’s hard to follow-up two big releases, but Saka seems to have succeeded in doing just that.
I do feel Espinosa Reggae DREAD and Undercrown Sun Grown got a fair amount of buzz.
Finally, it seems like each year we miss Nicholas Melillo and Foundation Cigar Company on this list. Foundation Cigar Company’s The Wise Man would have most likely been on this year’s list, but the announcement came past our deadline to make the list. In fact, the announcement was made the same day we published the predictions.
Who Emerged from the Trade Show?
New Companies: Plasencia Cigars and Jeremy Jack Cigars
Above, I mentioned Plasencia Cigars was the big winner, but I think there was another company that was a winner. The fact that the well-known Plasencias were now exhibitors, combined with a powerhouse media event and some excellent product made them stars at the show.
Jeremy Jack Cigars was a booth I’m sorry I personally could not find the time to visit. However, Prime Time Show host and Developing Palates co-founder Aaron Loomis did get there. From my discussions with him and others, Jeremy Jack Cigars seems to be the big winner. It’s a company started by Wyoming-based retailer Brady Hayek. They showcased a series of blends made at Casa Fernandez’s TABSA factory featuring Aganorsa tobacco. It’s a company I will pay much more attention to.
Existing Companies: JRE Tobacco and Southern Draw Cigars
It was actually the third show for the brands of JRE Tobacco (Aladino, Rancho Luna, and Tatascan). In 2015, the brands were introduced when they were a part of CLE Cigar Company. Last year, the brands moved to JRE, but were still exhibitors at the CLE booth. This year, JRE had their own booth. Even though it was not in a premium location (they were on the far-right in the back), this booth was as active a booth as I have seen.
Southern Draw Cigars was also a big winner. They were not at the show last year as owner Robert Holt decided to focus on production of some new projects. The move seemed a part of a bigger strategy that is paying off. This year Holt launched a new line (Jacobs Ladder), showcased a newly released line (Rose of Sharon), and gave his portfolio a packaging facelift. The result: this booth really shined and was quite a hub of activity throughout the week.
For Aaron Loomis’ thoughts on IPCPR, check out his editorial on Developing Palates.
Thanks to Developing Palates for making their photography available to Cigar Coop.
Special Thanks to De Los Reyes Cigars for sponsoring our 2017 IPCPR Trade Show Coverage!
Photo Credits: Cigar Coop, except where noted.