If you opened up the latest JR Cigar catalog, you probably noticed something is different.
If you went on jrcigars.com, you probably noticed something is different.
If you work for JR Cigar, you definitely notice—something is different.
Earlier this year, Rob Norris, the former national sales and trade director for Altadis USA—which owns the cigar retailer—was appointed ceo of JR Cigar. It was a move made to shake things up at the New Jersey-based retailer. Now, 10 months in, you almost wonder what Norris possibly has left to change.
JR Cigar is unique. It’s a division of Imperial Tobacco Group—the parent company of Altadis USA, the company responsible for producing and selling lines like Montecristo and Romeo y Julieta in the U.S.—which in turned is owned by the tobacco conglomerate Imperial Tobacco.
In 1971, Lew Rothman opened up a small cigar store in Manhattan. As the story goes, it had a sign that read “World’s Largest Cigar Store.” Back then, Rothman may have very easily been one of the smaller cigar stores on his own street, today, JR Cigar can at least lay claim in one way or another to that slogan being accurate. If there are legends in cigar retailing, Rothman probably stands above all else—Zino Davidoff, Nat Sherman included. He is responsible for a plethora of cigar retailing innovations,1 the birth and death of countless brands and the underpinnings of some of the most ambitious business deals the cigar industry has ever seen.
The empire would grow from that small store in New York City to include larger stores in New York City (now closed), New Jersey, North Carolina, Michigan and Washington D.C. A physical catalog business would also follow and JR would become an early player in the cigar corner of the internet. Cigar retailing is not all JR specializes in, there’s a wholesale distribution company known as Santa Clara and the company sells household items in its North Carolina superstores. Eventually, 800-JR Cigar, Inc. would be taken public before Altadis purchased a controlling stake in the early 2000s. Rothman remained a part of JR for a while after the sales, but today, he’s no longer involved in any official capacity.
Norris was tasked with leading JR into the next era. For him, that started internally.
“I didn’t expect the level of the depth of the people that were (at JR)—the knowledge and the innovation,” said Norris in interview with halfwheel. “They needed that shackles taking off.”
For many years, JR has overtly focused on older brands like El Rey del Mundo,2 the aforementioned Montecristo and Romeo y Julieta, as well as bundle brands it owns. It has not been a place where people would think to purchase more modern brands like Tatuaje or Crowned Heads. High-end labels like Padrón were present, but Davidoff was nowhere to be found—likely deemed too pricy for JR’s efforts which oftentimes focused on blockbuster levels of savings.
In March, Norris changed that. JR announced that it was now a Davidoff appointed merchant, a move that riled feathers amongst brick and mortar retailers, but the plan at JR was not to treat Davidoff like another close out brand.
“My feeling was that we needed a wider selection. We needed to offer consumers a wider selection. JR does a good job of doing what it does. It sells excellent value, consistent products. We needed to open the doors up to what all consumers are looking for at the moment.”
Changing the product was just one part of the Norris overhaul plan. It recently began shipping a new catalog, featuring an updated red and white color scheme. Inside are many brands that would have once been laughable to think of as things JR would carry, let alone feature. But it’s all part of the plan to modernize JR.
For many years, smaller cigar manufacturers were hesitant to do business with JR for fear of discounting. Most consider JR to be the second largest handmade retailer in the world by volume, a position that Rothman and others historically used to pressure manufacturers into better prices and more lenient discounting. JR and its competitors—Cigars International, Thompson Cigar Co. and Holt’s—oftentimes have shown little respected for the “suggested” portion of manufacturer’s suggested retail price (MSRP).
“Some of the conversations that I was having early on, I heard a lot of great stories about some companies might have got burned on a deal.”
Norris admits that strategy would probably do more harm than good in 2014. His version of JR honors the minimum advertised price restrictions that many cigar manufacturers require retailers to adhere to, while offering consumers a better buying experience, including when a customer is buying from his couch.
“It was a trust thing from their side and our side. We are not obsessed around price. We want to make it easy to buy products. We want to make it a good fun experience, even in the retail side.”
There’s a new website. It’s designed to be clearer and easier to navigate. Norris aid the old website was “too loud” and oftentimes, downright challenging to purchase from. But even before, the new site launched late last month, arguably the largest change was already front and center. A random glance at the JR website revealed featured products from E.P. Carrillo, My Father and Tatuaje; a far cry from the spotlight on Don Diego and JR Alternative to Montecristo, something many customers had become accustomed to seeing.
For Norris and his team, the website is the smaller of the new e-commerce strategy. It’s the “easy” he mentioned, not the “fun” he repeatedly brought up in our hour-long interview. There’s a poker game coming.
“We’ve got to have some fun with cigars. We have to bring some of the lounge aspect (to the online stores.)”
It’s called Beat The Dealer, a poker app for mobile phones. Predictably, users will try to beat the dealer with 10 winning a grand prize daily—usually a box of cigars—as well as 20 consolation prizes. Everyone will earn virtual chips, which eventually can be redeemed for cigar items. To increase the widespread use of the game and the interaction with JR, chips will be given out for those who invite their friends, use social media to promote the game, as well as review products on JR’s website.
Much of JR’s focus on Beat The Dealer is about the manufacturers. The company is partnering with cigarmakers to spotlight certain products. Its pitch is that the app serves as a highly-effective billboard for manufacturers to promote their products. In addition to acquiring a box by winning or accumulating chips, consumers will also have the option to purchase the product through the game, likely it a discounted price.
Both Norris and Michael Ackerman, director of commerce at Mc Management, Inc.—a part of the JR family of companies—were coy about what style of card game it will be but, Ackerman hinted it would be relatively familiar.
Beat The Dealer is scheduled to launch before the holiday season, meaning likely sometime in the next few weeks, but the next chapter in the Rob Norris book of overhaul is already being written.
In December, JR will close down its Statesville, N.C. store, allegedly laying off 77 workers. The lease is expiring and not being renewed, as the owner of the property wants a remodel of the aging property. JR has said that it will open a store in Mooresville, keeping its North Carolina store count at three. That store is likely to be cigar-focused, as opposed to its current North Carolina businesses which allow consumers to buy candles, dolls, linens and Macanudos; all under one gigantic roof.
Sales in the physical retail locations account for roughly 25 percent of JR’s business according to Norris, a staggering amount considering the size of its catalog and internet business. The company has two stores in New Jersey, which is where its corporate offices are located, both will begin a six-month remodel in January. Those locations are traditional cigar shops, albeit, with a uniquely expanded selection. They will get what Norris describes as “the next level of retailing stores,” a focus that will include making it easier to shop, more comfortable to smoke in and a place to educate consumers.
But a remodel is not all that’s coming to New Jersey.
JR will play play host to two different cigar festivals next year. One will be Smokin’ In the Carolinas, an event the retailer has put over the last few years at its North Carolina location, next year, there will be smoking on the Hudson.
“We’ve commandeered a ship that will allow us to smoke everywhere,” said Norris. “I’m really focused on offering manufacturers something.”
The plan is to host consumers and manufacturers on the Hudson River, something that is likely music to the ears of many. New York City plays home to one other notable multi-vendor cigar festival, Cigar Aficionado’s Big Smoke, but it hardly carries the same reputation as its Las Vegas counterpart.
Like everything else, Norris wants to make it easier and more fun.
Update (June 6, 2015) — Added clarification regarding the relationship between Altadis USA, Imperial Tobacco Group and JR Cigar.