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Cigar maven Peter Modeste and his wife Pamela..

Hello again faithful readers.  I’ve been a bit sparse in posting lately, as I’ve been traveling quite a bit for my day job.  The upshot is that I’ve been been on numerous flights where I’ve actually gotten to meet some interesting people.  It seems like most of the time that I fly that most people just want to keep to themselves and not be bothered to have a conversation (if there are any of you in my readership, could you please explain this to me in the comments?).

On one of my recent flights, I had the privilege of being entertained by the wit and wisdom of Peter Modeste, founder and cigar-smoker in chief for the recent startup Don Pedro Cigars.  In addition to our plane conversation, the Don was willing to answer some questions for the blog.

A former innovator and business success in the bio-tech industry, Don Pedro is one smart and savvy guy.  As you might gather from his responses, he’s incredibly passionate about what he does, which is the hallmark of any successful entrepreneur.  Like my earlier interview with Patrick Smith, I’ve asked Peter about the role of interactive and social technologies in his new business, and I think you’ll find his responses both insightful and entertaining.  And if you’re anything like me, there’s something fascinating about the “finer” things in life, and the connoisseurs of said things, as it seems that the more your know about what you’re experiencing, the better the experience.  So enjoy.

[Full disclosure: I do smoke the occasional cigar, but know little about how to truly enjoy it.  This page on Don Pedro's website really helped me out, and I look forward to feeling a little more like James Bond at the next Bachelor party I attend.  Also, I don't receive any kickbacks from these small businesses - I do this because I'm interested in what makes them tick and I love to provide some exposure to other industries that the readers may know little about.]

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Tell the readers a bit about your business. What do you sell?  How are you selling it? (please insert shameless plug here.)
We started Don Pedro Cigars as a way to perpetuate the lifestyle and heritage of fine cigar enjoyment. Our brand, a selection of hand-rolled cigars from Puerto Rico, is quite simply, among the best premium cigars available in the market today. The mixture of the famed filler tobaccos from Puerto Rico, which is grown at higher altitudes in rich soil that is devoid of chlorine (giving the tobacco an aromatic and free-burning quality), are custom blended with selected Cuban-seed tobaccos grown in other countries to produce a unique and exotic cigar with a perfect balance of flavor, subtle complexities, and richness.

Since we launched website in June of 2008, we have penetrated the market and establish our cigars as an exotic alternative to mainstream brands, and have grown to be the Internet’s #1 source for hand-made cigars from Puerto Rico. The geographic range of our customer base now spans from coast to coast in the United States, Iraq, Afghanistan, Japan, and the US Virgin Islands.

Currently our cigars are sold exclusively through our e-commerce website at www.donpedrocigars.com, and plans are underway to launch a very upscale “Brick and Mortar” social lounge facility in 2010.

What impact has the recent Big Tobacco legislation, lawsuits, etc., had on the cigar business?  What makes cigars different?
That’s a great question and a comprehensive answer might be a bit lengthy, but if you indulge me I’ll do my best to be brief. We recently discussed this topic in the last issue of our quarterly newsletter called “The Cigar Buzz”. Basically the new [from Andy:this link is to a PDF] Family Smoking Prevention and Tobacco Control Act, signed into law on Monday June 22, 2009 by President Barack Obama, gives the Food and Drug Administration oversight over tobacco products. So for enthusiasts and business owners alike, the potential impact is of great concern throughout the country.

Well, there appears to be some relief in the law for cigar smokers, since cigars appear not to have been included under the legislation’s umbrella. As such, preliminary indications from industry experts suggest they do not expect the law to have a direct impact on the cigar industry; at least not in the near-term.

Many people incorrectly try to group all tobacco products in the same category, which on its face is clearly absurd. The differences between cigars and cigarettes are as plain as night and day. They are manufactured, processed, and consumed differently. One is an addiction, the other is a hobby. Have you ever know anyone that needed to use a patch to quit smoking cigars? Treating cigars the same as other tobacco products simply because they are both made of tobacco makes about as much sense as treating a car and an airplane the same because they both have wheels and carry passengers.  Fortunately, our lawmakers had the intelligence and presence of mind to understand the distinctions, and as a result cigarettes are the focal point of the new legislation.

However, even though the focus is not cigars, the language and regulatory authority that it grants the FDA is somewhat ambiguous in places, which to me is a bit disconcerting. For example, SEC. 901. FDA AUTHORITY OVER TOBACCO PRODUCTS, states that it applies to “all cigarettes, cigarette tobacco, roll-your-own tobacco, and smokeless tobacco and to any other tobacco products…” It is the use of the phrases like “any other tobacco product” that I find most troublesome. Understand however, I’m not suggesting the legislation is disingenuous or unscrupulous with regard to its true intent, only that the vague terminology leaves room for the FDA to broaden its scope in the future, which could eventually impact cigars.

Forgive me for this, but when I think of cigars, I typically think of two things: old men playing cards and young men at bachelor parties.  And yet I hear that the number of women cigar smokers and up-and-coming socialites is on the rise.  Have you seen this trend?  Why?
Actually yes, I have seen this trend. You know what; there was a time when the old conservative gentleman was indeed the perception of cigars smokers, but really all that has changed now. When the “Cigar Boom” (the period from late 1992 to 1998, when cigar demand was much, much greater than cigar supply) swept the nation, it ushered in new generation of smokers. Today, the general feeling is that cigars have recaptured its traditional symbol of success, celebration, achievement and good fortune, they are appealing to a much more diverse and group – among this group are young professional adults and women.

There are various explanations for the market expansion of premium cigars, which undoubtedly include among other things, product placement in movies, of highly visible women smoking cigars, that fact that more women feel empowered and view cigars as a very public statement that they want to freely enjoy one of life’s great pleasures.

How important are social media channels to your developing business vs. more traditional marketing?  Why?
I think many businesses are beginning to understand that in today’s fast moving marketplace it is essential to integrate social media into their marketing plan and branding strategy. For Don Pedro Cigars, we plan to utilize technology better than any of our competitors, and social media is definitely vital component of our broader strategy.  The thing that we are currently working on is figuring out the best way to leverage the reach and power of social media channels while achieving balance with our traditional efforts.

Social media marketing has a lot of very attractive feature for a business owner. For instance, its relatively lower costs, its interactivity, and the ability of a well-executed campaign to reach and influence a very targeted audience are just a few. But since we view almost every strategic decision as problem solving and risk mitigation opportunity, we have taken a cautious, systematic, and methodical approach in assessing how we incorporate this important tool. Information, whether true or false, accurate or misleading, positive or negative, can propagate throughout the social web like a runaway train, and if negative it can be very harmful to our brand and counterproductive to our goals.

So while we consider social media channels to be a necessity, we also believe in pursuing a prudent, well-balanced marketing approach.

I know your expertise is in business, and not necessarily social media trends, but how do you see the social media market developing over the next few years, and how do you plan to engage it?
First, let me thank you for acknowledging that I am no “Rocket Scientist“ when it comes to my level of competency in the social media arena.  Having said that, I think that for anyone with a pulse, even a slight one, the rapid spread of the use of social media is no secret, and it is showing no signs of slowing down.

One key aspect of social media that I believe will be improving over the next few years is that we will see improvement toward more innovative measurement techniques. The old management adage that “You can’t manage what you don’t measure” is as relevant among social media channels as it has always been among traditional marketing. So I think that in the years to come we will see more accountability (i.e., calculating ROI) in marketing through social media.

If this develops as I expect, then it would allow us to make great strides in reducing the inherent risk in our overall marketing strategy. The improved measurements will guide our decisions by letting us know if a particular initiative is working or not, or if things are getting better or worse.

What are the things that social channels can’t help a small business with?
Really there is no substitute for quality products and outstanding service. And although a comprehensive marketing strategy is essential for a small business to survive, the core product/service offering, which is typically developed internally, is the foundation for building a successful organization.

Who should quit their day job and start their own business?
Ha ha! Let’s put it this way, running a business is not for the faint of heart. But seriously, not everyone is cut out to be a business owner. Notice that I said “business owner” and not “self employment”. There is a distinction between someone merely creating a job for themselves and someone building an organization that is organic and will grow with or without their daily presence.

With that said, I’ll leave out all of the obvious and perhaps generic stuff like finding something you enjoy, and having a plan, etc., and I’ll mention what I think are some of the more general things that is important for success. Anyone planning to enter into the world of entrepreneurship should do several things: 1) understand their personality and their appetite for risk, 2) be truthful with themselves about their level of business skill and acuity and know have a plan to fill any gaps, 3) evaluate their financial resources, 4) maintain a courageous problem-solving mind set, and 4) have patience.

Have you ever thought about lighting up a $50 bill instead of an expensive cigar?  Just kidding (sort of).  How do you see your business fairing in the Great Recession?
No I haven’t, but I doubt the experience of smoking cash would be as pleasurable as relaxing with one of our fine cigars your favorite beverage. As for the “Great Recession” the global economic downturn affected just about everyone. However in spite of the recession, Don Pedro Cigars has seen moderate growth. I guess in times like these, when people are measuring their success by who lost the least, any growth is a good thing. We are just grateful that our customers have responded so well to our exotic brand of cigars and are returning for more.

What is the best cigar smoking experience you’ve ever had?
I guess you saved the most difficult question for last, huh? Like most enthusiasts, I have many special cigar “moments”, and they are all special for a wide variety of reasons. At times it’s the camaraderie, at time it’s the quiet solitude or a host of other reasons. Anyway one special experience occurred about fifteen years ago. It was my first cigar smoking experience, but it left such an indelible impression in my mind, that I knew then and there I would never deprive myself the pleasure of partaking this affordable luxury.

I was going through the most difficult period in my life. I was distraught, overwhelmed, and my life was in shambles. That was when, as we walked through the streets of New York City, a lifelong friend and confidant suggested that we pick up some cigars at a local shop that hand-rolled their cigars right there on the spot. Going through the ritual of cutting and lighting the cigar seemed to take forever (there was no need to rush) and I instantly began to feel a soothing relaxation throughout my body and soul. Between the wonderfully fragrant aroma, the rich taste, and the utter euphoria, my mind became clear, more focused, and I was a peace. That single magical moment is special to me because it literally changed my life.

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I love the recurring theme of these interviews: there are no substitutes for product quality, passion, and excellent service.  I think as long as those principles remain the heart and soul of a business, rather than a brand’s identity being eroded by the need to answer to Wall Street, a true brand will always survive.

Toys ‘R Us: from kids’ playground to kids’ prison with a single promotion.

Saddening.  Sickening.  Soul-swallowing.

Three phrases that describe the end of summer, and the most dreaded of all phrases in a young person’s life: back to school.

This is a truth universal, as sure to come as the changing of the seasons.  It’s been embedded in our nation’s ethos since the industrial revolution and ensuing urbanization led to the closure of the one-room schoolhouses and the end to (most) home schooling.  And now, in a desperate play to gain market share in a weak economy, the place where kids “don’t want to grow up” suddenly transformed into another Target wanna-be (and not in a good way).  What’s next?  Despite it’s optimistically named signage, Toys ‘R Us’ “Back 2 Cool” program makes a paltry swipe at the lucrative back-to-school market and ultimately weakens the Toys ‘R Us brand.

I can just imagine the nightmarish scenario for thousands of kids across the country, their eyes sparkling with promise and wonder as they roll up into the Toys ‘R Us parking lot, anticipating the delights within.  When suddenly, the bottom of their world drops out and they realize what their Mommy or Daddy really brought them in for: pencil boxes, washable markers, and #2 pencils.

Toys ‘R Us selling school supplies is as ridiculous to me as the Mercedes-Benz minivan [full disclosure: I own a Honda Odyssey].  The best thing a brand can do is to become more narrow instead of broad (unless you happen to be a Wal-Mart), to further define a portfolio of products and services by who the company really is.  One thing about a company that has an imbalance favoring growth is that the brand gets ignored and trampled as top management seeks to drive up stock prices and profits.  Doing so for Toys ‘R Us means clearing out a huge area of floor space and adding school supplies to try to capture a few more dollars, instead of offering a consistently fun and unique shopping experience.  A place where kids “don’t want to grow up” should be filled with fun and toys that they simply can’t get anywhere else.   Calling a jumble of cardboard bins filled with cheap imported school supplies doesn’t exactly seem to fit the bill.  “Back 2 Cool” it most certainly is not.

It’s usually a lot of fun for me when a new client website launches. There is so much that goes into it, from the initial sales effort, to ongoing consulting, creative work, development, quality testing, etc., etc., that when it finally goes live one gets an incredible feeling of accomplishment (and sometimes a healthy amount of relief). For the past several months, I’ve had the pleasure of working on changehappensindegrees.org – a funky site that is the beginning of a campaign focused on saving energy and money for a lot of people. The site is targeted at homeowners, who can reduce the amount of money spent on annually on energy bills by up to $500 simply by using their ceiling fans and thermostats correctly.

Hunter Fan recently commissioned several independent studies that confirmed with facts what many assumed to be the case – you can raise your thermostat in the summer, and lower it in the winter, if you’re properly using a ceiling fan to keep yourself comfortable. This saves energy and money while you feel basically the same level of comfort in your home. These studies caught the attention of celebrity environmentalist and successful actor Ed Begley, Jr., who agreed several months ago to endorse the campaign and who has begun a media tour in support of Look Up. What Ed, and everyone else involved in this project, is excited about is that unlike installing expensive solar panels, or reinsulating your home, using a ceiling fan and thermostat is something that most people can do with little trouble. It’s a small step that most can take to positively impact the planet and to save themselves some money.

We will be adding several interactive modules, including a region-specific home energy savings calculator, throughout the year, so I’ll keep everyone posted.

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“Show me that smile…” I know that is the song that anyone born before 1980 undoubtedly had playing in their heads when they read the title of this post. Although I’d love to have some witty commentary on one of the legendary episodes from the early 80’s sitcom, I’m afraid that my title is alluding to something much less nostalgic (and notably lacking Kirk Cameron or Tracy Gold).

The agency I work for, now named n-tara Interactive, is growing by leaps and bounds. It’s very exciting to be working in an environment that is aggressively growing, because you always end up with something new to do, and limits are often tested. Our marketing department is working like crazy to crank out our new ID set and other materials, but the new logo and materials are just a small part of how our agency is growing. We’re adding more people, capabilities, and expertise, and running out of room in our building.

Where that affects me is that we’re obviously adding more clients with bigger budgets and more strategic objectives. It’s certainly kept me hopping and my blogging activity to a minimum, which in turn does not represent very well what I’m actually learning and experiencing on a daily basis. New trends in analytics, guided-selling, and the value of social media are all at the top of my mind, as well as the old favorites of agency project management and the proper way to manage client expectations (one in the same, to some degree). It’s become comical to me how much being a successful agency involves balancing bleeding-edge creative and technology with the basic principles of listening, managing expectations, doing your homework, and respecting those you work with.

Here’s an interesting thought for all of you career-minded folks out there: if you went back in time as your current self and was able to meet your self at 9 years old, what would your younger self think of your current self?

I recently read an article in this month’s Popular Photography that said a key to creativity is “unleashing your inner 9-year-old”. In other words, allowing your unrestricted creative side to take center stage, ignoring aspects of practicality and the limitations of your current camera technology.

It made me wonder, “Would my 9-year-old self think my current self is cool?” And also, “Is this even remotely important to the world of advertising and interactive media?”

I’ll address the latter first: business of any kind without creativity is dead. And I’m not just talking about artistic creativity here, but creativity with finances (within legal limits), HR, infrastructure, sales, project management, IT, etc., is all critical to a properly functioning business. As a former project manager, I can often let my obsession with proper details ruthlessly crush the big idea of a dreamer, simply because the idea at the time seems impractical. But I digress. Indeed, we need to be at least as creative as a 9-year-old in order to be successful.

Now, the former: would my 9-year-old self think my current self is cool? After much debate, I think little Andy sure would, at least for the most part. The reason I can be confident about this is that I’ve been blessed to do now what I’ve always thought I’d do: have a career in advertising and in sales. So on the job front I think I’d think I was pretty cool (follow that?). Sure, my job isn’t as cool as GI Joe’s, but I wasn’t really allowed to have many of those anyway (thanks Mom).

Plus, I’ve done quite a few things to keep my 9-year-old dreams alive. Through luck, I was able to marry a wonderful woman who grew up in Kenya, and thus in 2005 I was able to drive in the African bush in a Land Rover, one of my childhood fantasies. I’ve also purchased several large kites, and thus fulfilled my childhood dream of regularly being dragged across the ground by a giant kite. I have a son, some incredible friends, and I get to do crazy stuff like stand in a freezing waterfall in January with my best friends pointing and laughing. I feel like these things would be cool to my 9-year-old self, because although I’m constantly creating new goals and priorities, I still come back to wanting to do something crazy every now and then. I think the day that stops is the day I stop being creative.

That doesn’t mean that I’m never constrained by the harsh realities of life; far from it. But I think my 9-year-old self would understand that in order to buy a new bike, you have to mow the neighbor’s lawn to make some coin. I just want to keep some dreams alive and parts of life ridiculously fun.

What things do you do to keep your inner 9-year-old satisfied?

Debuting during the Super Bowl (and what a Super Bowl it was!), Coke’s new ads got my ad-sensibilities as tingly as Mitt Romney in a Utah primary. Gone were the ridiculous, “soft branding” tactics of bubbly music and roller-skating hotties, and in were a couple of ads that really get to the heart of who Coca-Cola undeniably represents worldwide today: America, and her uncanny ability to be the melting pot of the world.The spot with Democrat James Carville and former Senator Bill Frist is definitely my favorite. What other soft drink brand could make the claim to bring disparate people together and not be totally laughed at? Sure, Pepsi tastes better, but globally the world revolves around Coke. Overall, I was disappointed with the rest of the Super Bowl ads. Sure, it’s easy to be critical when my client’s $2.7 Million isn’t on the table, but I was pretty shocked at the overall mediocrity of the ads. Most disappointing to me (besides the horrific salesgenie.com ads) was the fact that several companies tried to bank on the success of a previous idea rather than coming up with something original. During the Bowl, I spotted the following:

• Audi R8 – parody of The Godfather “horse head” scene
• Budweiser – gratuitous use of the Rocky theme song
• Bud Light – “Breathing Fire” spot is a direct rip-off from the DQ and Taco Bell “breathing fire” commercials
• Diet Pepsi Max – ripoff of Saturday Night Live “Night at the Roxbury” sketch
• Life Water – ripoff of Thriller, with a dancing girl

I use the term “ripoff” and “parody” loosely, just to conserve words. What I’m talking about is using an existing, popular idea instead of a new idea in order to sell your product. Sure, it’s great to make your ad buck go the extra mile in today’s congested, information-laden airwaves, but using iconic, if not the classiest, entertainment parodies to promote your brand doesn’t seem that valuable to me. It was also unusual that only a couple of advertisers decided to push a website along with their ad (Tide and Doriotos).

Either way, even though USA Today would disagree with me, I think Coca-Cola won the day. And I’m pretty non-biased because I only drink a soft drink about once a month, and it’s usually a Pepsi product =).

Well. Wow. I’m still in a bit of shock. Philips launched the “Shave Everywhere” campaign last summer, and mercifully it looks like I missed out on it back then. It’s a site that unabashedly describes the benefits of, well, shaving everywhere. They’ve even coined a new phrase, which may be creeping into our everyday language as you read this: “Second Puberty”, or the process by which men begin growing hair in undesirable places as they age. A marketer’s dream.

Tasteful or distasteful? Appropriate or inappropriate? Bravo for broaching a taboo subject in mainstream media, or Shame-on-Philips for assuming men are so base and unintelligent? Everyone may draw their own conclusions, but in the end the site has definitely accomplished its goal: to gain brand awareness by being disruptive.

While I don’t personally find the campaign to be in good taste, I have to tip my hat to Philips for being willing to try something truly creative and potentially dangerous. I think I would echo a lot of creative people in agency jobs in saying, “Wow, I wish the clients I work for would be willing to do something that crazy…looks like fun”.

What could your company do if you weren’t constrained by traditional social mores or accepted advertising tactics? I guess the only way to find out would be to give more marketers and agencies permission to fail while trying out new ideas. Looks like fun.

Thanks to Steve (sort of) =) for the link.

In the world of marketing, you can score a double-play whenever you can create a promotion that is so noteworthy that more attention is drawn to your methods of promoting than to the promotion itself. A few months ago, the alternative music group (an overly simplistic label on my part) Radiohead released its first major album after parting with its record label. The album is available for download for whatever price its listeners are willing to pay, which was and is an amazing concept for artists and marketers everywhere. Check it out…it’s an interesting site and a great listen.

Of course, this model is only truly economically viable if you are fairly confident that you already have a strong, loyal audience that will carry the majority of the financial burden.

Steve Thorson, one of my friends and a co-worker from a previous life, is a designer for Paste Magazine’s website, and he let me know that Paste is using the same model to sell a year-long magazine subscription – you pay whatever you feel the magazine is worth to you. 11 issues, plus 11 full-length CD’s full of the latest and greatest music for progressive tastes. What’s great about this promotion, is that it’s also a gauge of the loyalty of its current subscribers, as Paste is allowing renewal subscribers to get the same deal. As an added incentive, Paste is highlighting those who pay more than the $19.95 for a standard subscription rate (although Steve tells me this experiment has yielded an unexpectedly high number of subscriptions at $19.96 by those who just want to be featured in the magazine).

This is a great deal for consumer, and a great deal for Paste, as they can expand their subscriber base to uber-frugal people like me that wouldn’t normally pony up the 20 bucks for a magazine about music (yes, guilty, I paid a dollar, but I know that Paste will make it up in ad revenues). Asking people to pay what they want is the next best thing to giving it away for free, and it offers the added benefit of giving you, the marketer, a very real picture of what your value is to your customers.

>>UPDATE: Steve just let me know that the slew of subscribers at $19.96 was inaccurate (and third-hand) information. So far, only one person has done that. On the upside of things, he said the highest price someone has paid so far is $70. So now, I can officially feel less guilty about only spending a dollar.

After a semi-long absence, I’ve decided to go a little Seth Godin on you and post a picture from my camera phone.

Sure, as a photographer this image makes me cringe, but my trusty Treo was all I had on hand. While on a client pitch in NYC earlier this week, I spent a few minutes in a lobby with a DHL drop-off box. I was inspired by the simplicity of the answer for a very important question that anyone about to drop a package in the box may have, “Have they picked up packages here yet, or not?”.

The large, block letters in all caps that indicate if a package has been picked up or not are not sexy, or even all that interesting, but they are 100% functional. I think that can be a hallmark of great design. DHL could have gone with a really slick system of lighted buttons, color-coded tabs, or whatever, but instead they chose the direct route. If I can walk up to the drop-off and see immediately that the packages for the day are “NOT PICKED UP”, I can drop my package with confidence and not have a second thought, which I would bet is exactly what the drop-off box designers were going for. Bravo DHL.