Three years ago, Oettinger Davidoff made a bold statement about its ambitions to widen its global presence in the cigar market with the global re-launch of Zino – a brand inspired and named after cigar pioneer Zino Davidoff.
The aim was to complement Davidoff, the group’s powerhouse and one true global luxury cigar brand, with a second leg that would carry international appeal across regions – and importantly introduce a new, younger adult audience to premium cigar culture.
Today, the Zino trajectory is ahead of expectations: sales of 1 million cigars in year one reached 3 million in year three across all formats.
Click on the video for more on the spirit of Zino
As SVP Chief Commercial Officer Luc Hyvernat put it at a meeting of partner retailers and distributors in Zurich and Gstaad last month – attended by The Moodie Davitt Report as sole media – “for a new cigar brand that is some performance”.
Innovation comes in the form of Fresh Packs, allowing ‘grab & go’ by the consumer and the flexibility to place long-filler handmade cigars outside of traditional cigar environments – an important factor in boosting visibility and accessibility in travel retail.
There is product innovation too, with the Zino Nicaragua Half Corona in a pre-cut format, meaning there is no need to carry a cutter, and with packaging in an eye-catching protective tin.
Travel retail is at the heart of the distribution strategy and is a core focus of the drive to build awareness of Zino, says Head Partner Markets & Duty Free EMEA and Americas Jean-Christophe Hollay.
“Travel retail is leading the way. We have done a lot already to develop Zino in travel retail, with successful traction at major airports such as Istanbul – already a big volume contributor. Placing the Fresh Packs outside the humidors improves access and positions the brand in front of a new generation travelling. It also encourages cross-category purchase, which every retailer is interested in.”
He adds: “We are also showing with Zino that you can build a brand through duty free. It is not usual and there was scepticism internally about this, but there is something in Zino that is unique and appealing. It’s still early – we are only entering year four and had COVID in between – but the signals are converging to show it’s a success.”
Zino is positioned as a new cigar proposition for a new generation – which means that while the emphasis on handmade quality remains, everything from the branding to the packaging has been redefined.
“Zino’s purpose is to become an everyday cigar for a new generation of smokers, by breaking down the rigid monochrome of the traditional cigar world,” said Senior Vice President Head Global Marketing Edward Simon at the partner meeting.
This is why the company chose a vibrant yellow for its branding – it breaks away from the rather monochrome brown associated with the world of cigars. This is complemented by the tag line ‘Live life A to Zino’ – introduced and repeated by a video avatar throughout our immersion into the brand, first in Zurich, then in the ski resort of Gstaad recently (see panel below).
Zino also offers Oettinger Davidoff a competitive edge in the hard-fought mid-price premium cigar segment, without cannibalising its other brands, Davidoff in particular.
Simon says: “With Davidoff we cover most needs and occasions and preferences but one barrier to user penetration lies in the price proposition. In domestic markets you only find Davidoff in 10-35% of tobacconists at the premium end. We aim to fill that gap.
“Zino also helps underline how we are a house of brands, not just one. And among our portfolio the target is to have clear brands for clear target consumers, and not to cannibalise ourselves like others do.”
In addition, the flavour profile built around Nicaraguan tobacco is one increasingly preferred by a new generation of cigar smoker, says the company.
Zino’s emergence also chimes with the rise of cigars as part of people’s lifestyles through and since COVID-19.
The target audience is mainly adults between 25 and 35 years old, setting out on their professional career. They have disposable income, are ambitious, enjoy flexible work arrangements and prioritise experiences in their spare time, says the company in its characterisation.
Crucially, while they enjoy quality, want to reward themselves and are well informed via digital media, they are not rooted in cigar culture.
Simon says: “We want to bring out the lust for life, we want to shy away from the traditions that make the cigar sector a bit dusty, and engage that consumer who is just looking to be surprised.
“Zino resonates with Millennials and Gen Z who will be driving the growth in the business. This is why the packaging principles are important: Zino has stand-out on shelf, is colourful and easily identifiable. Like wine, the cigar category is not easy to navigate so you need help to achieve this.”
Hollay says: “With Zino we aim to bring new codes into the category, generating interest among a new generation.
“Zino is a plug and play cigar. You don’t need experience in cutting a cigar or any great knowledge. The pre-cut format means it’s good to go and is easy for weekend travel when you’re buying your bottle of wine or spirits. The combination of the offer at high quality and a good price is compelling.”
The branding is translated to duty free in various ways. Mirroring the pack colour, yellow walls and corners break up the traditional cues of the cigar world within the store.
Hollay adds: “Zino’s success will be built on distribution and is about increasing the occasions for making it a quick, accessible purchase. Here the Fresh Pack of four is helpful as you don’t need a humidor for display. We are simplifying the ceremony in creative ways.”
On ambitions for the brand, Hollay says: “We can easily double the Zino business without cannibalising Davidoff at all. We also had early success with the fresh packs at airports where now we are seeing repeat purchase but now for boxes of 25 instead of four-packs.
“The growth curve is interesting and a signal that we are generating loyalty too. It also shows that quality is being recognised alongside value for money. We can do more – we are still growing distribution – including for example inflight. We sell the fresh packs on the plane – it’s now easier for the airlines as they don’t have to worry about keeping the cigars in humidors. The same applies to ferries or cruiselines. Tobacco is important in these channels and we add a new dimension.”
Click on the video for highlights from a memorable two days in Zurich and Gstaad
Zino and travel retail more widely will also play a part in the updated group strategy for growth, under the title ‘Aspire 727’. This outlines the plan to sustainably grow sales and profits by 2027 and builds on record results in 2023. Figures will be released by the company in June but include a healthy rise in sales on the 2022 turnover of CHF494 million (US$545 million). Within this, partner markets and duty free grew well ahead of the average, buoyed by double-digit growth from Davidoff and Zino.
Hollay says: “Davidoff has always been into duty free and we know the channel well. We are booming since COVID and we in travel retail contributed more than average growth so we are among the drivers, plus we are willing to drive that further.
“We are showing that our shopper-centric strategy works and that is changing the conversations we are having with retailers. We are discussing placement of cigars outside the humidor, about where the humidor is positioned in-store and we are talking cross-category plans, which did not happen often before.
“The cross-category sell can be about spirits, but cosmetics can cross over too – it’s about enjoyment and self-treat.
“It’s a long-term game – we will continue to add our data and insights to show the value of the cigar consumer and their impact on growing basket sizes. It can do a lot for their overall business.
“Post-COVID this category has been among the fastest to recover – retailers recognise this and are seeing the opportunity. I am convinced we are moving in the right direction.” ✈
Seizing on the ‘power of the room’Oettinger Davidoff hosted a hugely memorable two-day event in early March to outline its ambitions for Zino and to immerse retail and distribution partners in the world of this disruptive new global brand.  An introduction to the brand was followed by a cigar dinner in the city of Zurich, and the next day the 90 or so guests made their way to the swish ski resort of Gstaad and then by cable car to a mountain-top chalet for drinks, dinner and a sampling of Zino across its many formats.    
“We have shown that it is successful, that it is credible and that is has a place in the segment. And through some nice event experiences we are also connecting our world of partners, retailers and distributors, in one room, while recognising what so many of them have done for us over many years.” He says that interaction and shared learning between guests was as important as the messaging from the brand owner. “People are all here because of the trust and relationships we have built – and because we all serve the cigar shopper. “Having everyone under one roof to tell the story is important. People can engage with each other. Every partner has their own magic they bring to this business. They are advocates, they witness each other’s stories, and it builds relationships and reinforces the importance of the brand. “What we can do together is about personality and partnership and it speaks to the ‘power of the room’.” |
Head Partner Markets & Duty Free EMEA and Americas Jean-Christophe Hollay says: “The purpose of the two days was to ensure people understand that we are serious about Zino as the second global brand next to Davidoff.
