silent revolution happened during the past years that changed markets forever. For the first time in history, consumers have a voice, and they have been actively using it since to reshape whole industries with their feedback. Until recently, businesses had to spend billions in consumer research, building complex and expensive methodologies to learn about their clients' likes and dislikes. E-commerce growth (further boosted by the COVID-19 crisis) and the critical role of consumer reviews changed this situation forever. Companies today can count on billions of spontaneous consumer reviews about real-life product experiences, a treasure trove of actionable business insights of unprecedented quality that influence billions of consumers worldwide. This opportunity is particularly disruptive for the cigar industry. The very nature of cigars retail — heavily founded on e-commerce and small tobacco shops — has prevented the category from accessing Nielsen-grade Retail Measurement datasets. E-commerce market data are now offering the cigars industry a unique opportunity to access Market Performance Data of the same quality provided for years to FMCG companies.

Cigar smokers are connoisseurs, and their reviews reflect that.

E-Commerce merchants know that consumer reviews drive sales, and the cigar industry is no exception. Since 2015, the top cigars online merchants in the US have promoted consumer reviews, bringing them to a whopping 300,000 (as of Q1–20). JR Cigars and Cigars International have massively contributed to reviews' growth, with the latter aggressively promoting them among their users in 2018.

Cigar Reviews Volume Trend
MASSIVE — Cigars Reviews Volume Trend by Merchants — US market

This recent push brought Cigars International very close to JR cigars at a 34% share but lowered its RQR (Reviews Quality Ratio) to a respectable 82%. The RQR metric indicates how many "good" reviews exist, i.e., feedback that is meaningful, information-dense, and rich in opinions; it's no surprise then that the two professional review sources, Halfwheel and Cigar Aficionado, get a 100% RQR. All the reviews that are very short or too generic (e.g., "I liked this cigar") do not bear any insight and are also good fake reviews candidates. But fake reviews are a sporadic occurrence in the cigars industry; as a matter of fact, 8 out of 10 cigar reviewers put great effort into writing very accurate reviews; just to put things into perspective, a lot of FMCG categories show a 50% RQR on average.

MASSIVE - Cigars Merchants Reviews Quality Ratio
MASSIVE — Cigar Merchants RQR

Cigars, very much like wine and meditation spirits, is a category that requires connoisseurship. Cigar smokers are discerning consumers; the storytelling and detailed smoking experience are a fundamental part of a cigar's allure, just like a good bottle of wine.

"Fake reviews are a very rare occurrence in the cigars industry; as a matter of fact, 8 out of 10 cigar reviewers put great effort in writing very accurate reviews. This is a category of connoisseurs."

For the same reason, cigar smokers feel almost obligated to share their experiences with others; they do it with more detail than other categories because accuracy means expertise. Thanks to this exceptional quality,consumer reviews in this industry are as influential as professional ones (if not more)and play a vital role in cigarette purchases.

Consumer reviews are the compass to navigate a very turbulent market.

At the time of this article, more than 700 cigar Brands are currently sold in the US, accounting for almost 3,000 different lines, counting up to tens of thousands of SKUs. Not exactly an easy market to navigate, and consumer reviews are the compass to navigate these unknown waters..

"Cigars is not exactly an easy market to navigate in, and consumer reviews are the compass to navigate these unknown waters."

The Conviction phase plays a vital role in the consumer journey; smokers do not want to buy a 30-cigars box only to discover that they don't like the product. For this reason, reading consumer reviews is the most critical activity for consumers'Preferencein this market.

MASSIVE - Cigar Brands Positioning
MASSIVE — Cigars is a very crowded market with more than 700 Brands

The chart above maps cigar Brands according to their Average Rating and Net Opinion Score (NOS), a proprietary measure that calculates the polarity of the opinions expressed by the consumers in their reviews. At an average rating of 4,28 (on a scale from 1 to 5), reviews in this category are almost enthusiastic. Brands must keep high standards to be preferred, and any Brand below 4.0 is significantly underperforming. The top right quadrant shows the exceptionally loved brands, with the infusedTabak Especial from Drew Estateleading the way. On the other hand, the top left quadrant shows highly-coveted Brands that are also very segmenting. The highly praised Aging Room Brand, Camacho, and many other Davidoff Brands belong to this peculiar segment.

MASSIVE — Cigar Brands Content Risk Map
MASSIVE — Cigar Brands Content Risk Map

Consumer reviews are a low-perishable kind of content; this is fantastic for Brands that can count on many positive reviews, but it is a terrible curse for those with an excess of negative ones. Brands like H. Upmann need to act carefully because they have significant negative reviews that will be visible for a long time. In this scenario, a company must know precisely how their Brands map out on merchants' websites.

What do cigar smokers really care for?

Reading and understanding 300K consumer reviews in one breath is no easy feat, and this is where Artificial Intelligence comes to help. We asked our AI to identify the critical performance topics of the category, as consumers' random words define them.

MASSIVE — Cigars Key Performance Drivers
MASSIVE — Cigars Key Performance Drivers

Twelve Key Performance Drivers (KPD) - from Aroma to Texture - are expressed here. Not surprisingly, aromatic descriptions account for one-third of the total mentions. But still, we know nothing about what topics really drive consumers' decisions. Category professionals considerstrengthandintensity to be essential aspects of a good cigar, yet their mentions account only for a mere 4,2% of the total. Does it mean these performance drivers do not matter? Not necessarily. Further analysis will help us discover the most influential drivers, i.e., those that move the final rating the most.

MASSIVE — Cigars Key Performance Drivers Map

We can find the answer in the Key Performance Drivers map shown above, where we identify three key areas:

  • POINTS OF PARITY: this area includes the KPDs consumers mention when they are happy. There's no significant room for improvement here, but a Brand must perform at least on par with its competitors;
  • POINTS OF DIFFERENCE: The mention of drivers in this area significantly decreases the rating— people are usually unhappy with these aspects. Brands have an opportunity to up their game in these areas to win over the competition;
  • IRRELEVANT: these two areas include performance drivers that have no significant impact on the rating.

The two critical performance drivers smokers are very unhappy with are:

  • BUILD, i.e., the tobacco quality and the assembly of a cigar, and
  • DRAW & BURN, i.e., the ability of the cigar to stay consistently lit and burn at an even pace to allow a pleasant smoke.

INTENSITY might sometimes lead to reviews, but it doesn't significantly move the needle. A Brand wanting to lead the market must know these general dynamics and understand its weaknesses and strengths in consumers' eyes. Relying only on a fancy concept to win the market is not enough; it might stimulate trial, but the only road towards success (and profits) is to carefully profile your Brands against the competition on the most influential performance drivers and improve performance accordingly.

MASSIVE - Cigars, Draw & Burn Top Performers
MASSIVE - Draw & Burn Top Performers

DRAW & BURN is an opportunity area for category players. As shown in the chart above, very few Brands offer a positive Net Opinion Score in this area. All the other Brands have at least some occasional issue on this KPD that often overturns an otherwise positive aromatic performance.

Learn to speak your consumers’ language

Today Artificial Intelligence can help you discover powerful insights from a massive cloud of indistinct Big Data in ways that were impossible before. Behind every Key Performance Driver listed here, there's a list of keywords automatically identified by our next-gen geometric AI that analyzes reviews as a complex matrix of geometrical connections. Thanks to its unparalleled accuracy, our AI teaches us the specific category's vocabulary - consumers use more than 1,000 aroma descriptors for cigars! This approach provides x100 less selection bias than a normal NLP (Natural Language Processing) technology, so every valuable opinion is included in the analysis.

MASSIVE - Cigars Aroma Word Cloud
MASSIVE - Cigars Aroma Word Cloud

The word cloud above includes all the keywords representing an aromatic trait. It is interesting to notice how smokers use the noun "flavor" to describe a pleasant aroma, while "taste" is used for negative ones. Knowing these language nuances is essential to communicate effectively to consumers, as the wrong word would subliminally convey negative emotions to their unconscious. Similarly, when referring to the piquant notes of some cigars, smokers use the adjective "peppery" as a negative connotation. In contrast, the same concept is expressed positively by using the term "spice" and all its variations/derivatives. Multiply this phenomenon for every key performance driver, and it will be clear how imperative it is for Brands to learn their consumers' language.

A world of opportunities unravels as Artificial Intelligence and Big Data merge to create robust datasets of unprecedented width and depth, unleashing the power of real-life consumer insights. Today companies can see their market with remarkable clarity; the time of blindness is eventually over, and the cigar category is no exception.

April 14, 2020
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