This past week, a firestorm emerged in the cigar industry following information that came out of the International Premium Cigar and Pipe Retailers (IPCPR) Association’s plans to rebrand itself as the Premium Cigar Association (PCA) and subsequent plans to add a consumer component to the Trade Show reportedly called CigarCon. The issue of a consumer component to IPCPR has been one of the most controversial ones Cigar Coop has seen over the past ten years of covering the IPCPR Trade Show. Unfortunately the plans for communicating this news to the industry went awry when the story leaked out.
The idea of a consumer event piggybacked (not mixed) with the IPCPR Trade Show was proposed in 2013. When it was announced, the IPCPR solicited feedback and got an overwhelming “No” in terms of the response. The idea was tabled, but has been a polarizing topic even since then.
Six years later things have changed in the cigar industry. It’s an industry that is in a fight for survival against the U.S. Food and Drug Administration (FDA). It’s an industry that has now had to transform to playing in the world of digital media. In addition, the IPCPR’s signature event, the IPCPR Trade Show has suffered. Some have argued attendance has gone down, and while it’s difficult to quantify that statement, the perception is there. Based on this, one can make the argument that the status quo is not the answer and IPCPR needs to undergo an organizational change.
An initial hint of a change coming to the IPCPR occurred last October with the implementation of CigarAction.org. This was intended to serve as a resource to get information on public policy issues relating to premium cigars and spearhead calls to action. What was different about this is it was the first major initiative by IPCPR not geared solely for retailers, but the broader public – including consumers. Back then I questioned the overlap with the Cigar Rights of America (CRA), and suspected this was the beginning of something more, and this appears to be the case. In my mind, there is little doubt that CigarCon is a component in that strategy. Whether that strategy is the answer remains to be seen.
From my observations on where things are now, I offer seven points that I think the IPCPR/PCA needs if they are going to go forward with a Consumer Event piggybacked with the Trade Show. While Halfwheel.com uncovered details on some of the mechanics and plans of a proposed CigarCon event, these seven points are not based on those specifics. Instead these points assume that there is going to be a concept of Consumer Day and outline points that should be considered if a fundamental change like this comes to the week of the Trade Show.
1. Focus the 6/28 Major Announcement on the Future Vision
Originally plans were to make a “Major Announcement” on June 28th in Las Vegas on the eve of the Trade Show. The “Announcement” would unveil the new name and new mission of the organization (and potentially consumer day). To build some excitement, IPCPR decided to do a Facebook video “teasing” the announcement. This ultimately led to the leaked information of IPCPR’s plans.
Despite some of the criticism of the teaser IPCPR put out on June 19th, there was an important point that was made. “We want to become the premium cigar and pipe industry’s center of excellence…not only are we going to expand what we do, but who we do it for,” commented IPCPR Executive Director Scott Pearce.
While the statement sets the tone going forward, it’s going to be more important to expound why this transformation needs to be done and what they are envisioning. Before the leaks came out, I do believe this is what was on the agenda for the major announcement.
There is still more that needs to be done. The vision is going to have to be sold to the members, especially the retailers (see below). A detailed roadmap should be developed and shared with the membership base – including timelines. This would be more than ideas being thrown out, but shows the plan of action going forward on how that vision is going to be delivered.
It’s no secret the cigar industry is one that is divided on many issues. Look no further than the battle the industry is having with the FDA. To a lesser extent, Tobacco 21 is another dividing point to some. A consumer element at the annual trade show is not something the industry is in agreement with. Making a major change that further divides the industry is not going to help this industry – and a Consumer Day is certainly a divisive issue. It’s going to be important to have a strong vision to bring everyone on board with this idea.
2. Hit the Reset Button on CigarCon – for Now
This is probably something the IPCPR and soon-to-be christened PCA is not going to want to hear.
The way the information leaked out about a proposed CigarCon event was nothing short of a disaster. However, even if the information hadn’t leaked out, the major announcement would have just delayed the firestorm that happened. Selling the idea of CigarCon won’t work unless there is buy-in to the PCA’s vision and a confidence level they can deliver on the vision. Until that happens, I recommend putting a temporary brake on CigarCon or any proposed consumer event joined to the Trade Show.
At a minimum, I would postpone plans for a 2020 event and perhaps target 2021 on the roadmap.
While it is totally impossible to have every PCA/IPCPR member be a part of the decision-making process, I do think opinions need to be opened up to a wider group than has already been brought into the fold. I’m not the biggest fan of surveys, but as an initial first step, it would take a more accurate temperature in terms of what needs to be done to make a CigarCon work. From that point, it could be gauged how or if it makes sense to move forward.
Bottom line, crawl before you walk.
3. Articulate the Business Case
While we can argue until the cows come home on the logistics of a Consumer Event piggybacked to the Trade Show, ultimately the cigar industry wants to make money. They certainly do not want to eat into their profit margins.
I don’t know if the business case has been developed as of yet, but from feedback I’ve heard, there are a lot of questions from the manufacturers who ultimately need to support a Trade Show and Consumer event. These questions are around the financials of such an event. Many are worried less selling time will mean less revenue from trade show sales. Having a booth up for consumer day is more costly than a trade show day because there are no sales that will occur on the consumer day. In addition, a consumer day would require extra staffing, travel, swag, and cigar costs.
Personally, I think if a convincing business case for a Consumer Event is made – namely one that demonstrates ROI, profitability, and how this can better promote the industry, it will mitigate the controversy of doing a CigarCon adjacent to the Trade Show.
One concern I have seen from manufacturers is the perception of giving out cigars in a “trick-or-treat” fashion. Earlier this year, I filled in for Matt Booth at the Room 101 “booth” at The Great Smoke. I got to experience first hand how difficult it can be. At the same time, it wasn’t my cigars being handed out, so certainly it wasn’t at my expense. However, there are valid concerns for manufacturers here. Many of the consumer events are tied to a retailer. Some have cost recovery and some have an upside. With this event being run by the PCA, there are going to be more questions here on costs. This ties back to the financial model, and the framework for a Consumer Event piggybacked to the Trade Show needs to incorporate this factor in. In the end, I think it’s a bad idea to create another event at the industry’s signature event where consumers just get cigars (I factor more interactive seminars and education mixedi in). At the same time, if you bring consumers into the event, they are going to want to walk away with cigars.
The bottom line here is if this can be shown as a profitable event, people will be more accommodating to the logistical challenges of supporting a consumer event attached to the trade show.
4. Strengthen the Base of the Retailer Members
For the past 87 years, the RTDA (Retail Tobacco Dealers of America) and more recently IPCPR have been an organization to serve the retailers. Unfortunately, the information out there has the retailers worried that their needs will no longer be the focus of the new PCA model. The name change alone raised this concerns.
I’ve covered this trade show for many years and I’ve seen the challenges many of the retailers have gone through. Now is the time to articulate how the new PCA will better serve the retailers despite the expanded focus. The money that is being spent at the Trade Show comes from the retailer community. It’s important to keep that segment of the new PCA organization energized.
While there are times I have felt like a second banana as an IPCPR member, I can tell you the one thing I always understood is that this was still a retailers organization first and foremost. I’ve never had a problem paying a membership fee to be a part of it. In the end, I’m still given credentials to cover the industry and that’s not a right, it’s a privilege – and one I have to respect.
5. Show the Manufacturer Support
In addition to supporting the retailers, my question is what about the manufacturers? Many of them are going to be asked to support the new world order of a proposed Consumer Event adjacent to the Trade Show. From my conversations with many leading brands, despite the leaks, few manufacturers were in the know of this decision-making process.
I’m not sure how far the CigarCon that Halfwheel described is along. My hope is that the focus is on the vision statement but if there have been further plans involving details, including logistics and financial models that the PCA will bring on board some manufacturers that have bought into the concept. As mentioned, many concerns, particularly the financial viability of a CigarCon have been raised by the manufacturing community. If there are manufacturers who bought into the concept, it would be advantageous for the PCA to deliver the messaging in conjunction with these manufacturers. In the end, it would strengthen the messaging.
6. Don’t Forget About the Media
While there are concerns about how the retailers, manufacturers, and consumers will all co-exist in a new world order with CigarCon, it seems like the media is being forgotten about – even by the media itself.
My personal experience is that it is very difficult for media to cover a cigar festival. Cigar events tend to be a chaotic at times. The same holds true for the Trade Show. Most media brands work the show floor the full 3 1/2 days. There is no such thing as a “slow day” on the final day for media. In fact, it’s quite the opposite – it tends to be a crunch.
Prior to the emergence of online media outlets, it was print media that covered the trade show. In many cases, you had to cross your fingers and hope your products made it into the next issue. In recent years, Cigar Aficionado had decreased its IPCPR recaps to a short blurb in its Cigar Insider publication. Now with online media, expanded coverage is available. It provides more channels for manufacturers, particularly the smaller ones, to cover the trade show.
Will media have less time on the trade show floor? Will media have to fight with consumers for time at the trade show? If the number of days of selling are reduced, does that make it more difficult to cover the booth? Will any changes affect cigar media’s ROI?
Most online media outlets have seemingly been radio silent on what it means for them. That is quite concerning to me.
7. Plug the Leaks
The bottom line is I don’t fault Cigar Authority for publishing the trademark information for the PCA, and Halfwheel for breaking the details of the PCA, CigarCon and a proposed Cigar Rights of America and IPCPR merger. At the same time, these leaks were happening. There were too many people who were brought into the fold talking.
Non-Disclosure Agreements (NDA)s exist for many reasons. Either it’s time to use them – or start better enforcing them if they have already been put in place. While I favor a more open approach in terms of the roadmap, there are things that must be kept confidential and a bad job has been done thus far on that.
The bottom line everyone deserved to hear about this change directly from IPCPR’s lips.