Knowing Your Market
A couple of years ago, Scottsdale, AZ-based Premium Cigars International Ltd. latched onto a pretty nifty idea: With cigars already fast becoming a yuppie status symbol, why not push them into the mass market by placing them in convenience stores and other small shops?
The plan worked. Premium Cigars now markets its stogies to about 10,000 retail outlets in the United States and Canada.
This year, the company has debuted another nifty idea. It has put up a Web site to directly sell, both to its customers and other consumers, many of the impulse-buy items often found in convenience stores.
With ProductExpress.com (www.productexpress.com), Premium Cigars is capitalizing on its order processing, tracking and distribution system that serves thousands of stores.
“We can have an order ready to ship in 20 minutes,” boasts Heather Schneider, e-commerce project manager. “We believed that we could leverage the company’s great core competency into an e-commerce site.”
Along with its fulfillment expertise, Premium Cigars is counting on its knowledge of the convenience store market to make ProductExpress.com-launched March 29-a success. The company services convenience store independents and chains like 7-Eleven, Circle K and Mobil, in addition to grocery, drug and other mass market stores.
Premium Cigars sells hand-rolled cigars in countertop and freestanding humidors. Brands offered include Macanudo, Bering, H. Upman and Partagas, priced from $1 to $10.
The company, whose corporate site is at www.pcig.com, delivers the smokes through distributors and uses its own customer service staff to make calls and ensure the stores are satisfied.
But for the new offerings-and for some select cigar products-it’s going direct.
“There are about 100,000 convenience stores, and most are not part of a chain. The distributors have so many products, it’s hard to keep the service side really great,” Schneider explains. The password-protected wholesale side of the site offers 72-hour delivery via FedEx on items in stock.
Other merchandise includes Fresch Breath Mints, Wally Balls (car antenna/pencil toppers), Dr. Pump (a pocket-size air pump), Shock-a-Lots (chocolate-covered coffee beans) and Deziner knock- offs of designer sunglasses. ProductExpress.com, of course, markets cigars and accessories, including samplers, gift packs and humidors, and will be adding new items.
Eventually, ProductExpress.com intends to offer marketing and sales data to retailers, including information on sales techniques, merchandising suggestions and consumer demographics.
“It will give [retailers] a lot of information they don’t normally get from a distributor,” Schneider says. The site also plans to have chat sessions and forums, especially for the independents, to discuss strategy.
Many items are sold to consumers on non-intranet Web pages at the ProductExpress.com site.
“We decided to sell other products on the B-to-B side, and then because we have this distribution center that can also quickly deliver to residents, we thought why not go to the end-consumer side as well,” says Schneider.
Premium Cigars is a relatively new company. It launched in December 1996 and has since acquired a Canadian subsidiary in the same cigar-supply business, Can-Am International Investments Inc. Together they have about 50 employees.
