Cigar maker hopes to light up Japanese market

Altadis, the world’s leading cigar maker, is set to increase its share in the small but fast-growing Japanese market by primarily targeting fashion-conscious young professionals, according to the firm’s Asia-Pacific sales manager.

Eric Piras, vice president of Hong Kong-based Altadis Cigars Asia Pacific Ltd., said recently in Tokyo that the Asia-Pacific region, including Japan, is an emerging and developing market with rapid growth potential.

The Japanese cigar market is currently minuscule. In terms of sales volume, just 70 million cigars are sold a year, compared with more than 314 billion cigarettes, according to industry sources.

A Japan Tobacco Ltd. official said, however, the market for cigars is showing signs of growth, fueled in part by the successive opening of trendy cigar bars in busy urban areas and media publicity drives featuring celebrities as ardent stogie fans.

“A cigar-puffing culture is being fostered in this country,” the JT official said.

The tobacco monopoly apparently prefers, nevertheless, to concentrate on cigarettes, its mainstay business, leaving the cigar niche market free for cut-throat competition involving foreign imports.

Altadis is one such player set to penetrate the small yet burgeoning market.

Last summer, the French-Spanish amalgamate, which purchased the major U.S. cigar maker Consolidated Cigar in 1999, introduced four types of cigars in Japan under the brand name Flor de Copan.

Rolled by hand in Honduras, these stogies — Corona, Rothchild, Belicoso and Monarcas — are retailing at prices ranging between 500 yen and 800 yen apiece at 200 to 300 specialized outlets nationwide.

While Altadis holds a large share of the world’s major markets — close to 40 percent in the United States, 43 percent in Spain and 33 percent in France — it faces tough competition in Japan from rival foreign brands.

Piras appears optimistic, however.

He said fashion-conscious and brand-oriented young Japanese professionals will regard cigars as another pastime, although it is uncommon to see young businesswomen puffing away at post-5 p.m. cigar bars in Tokyo.

He said his company’s premier brands will seize a major market share in Japan, possibly raising the current 4 percent to 5 percent up to 20 percent in the foreseeable future.

To this end, Altadis this month will start selling the Don Diego Reserve No. 4, a premium stogie handmade in the Dominican Republic that will retail at 1,000 yen apiece. In May it will add new cigarillos and little cigars to its line of products in Japan.