A smokin' insight into social media. From The NYT: Case Study - EPC Cigar, a Start-Up, Using Twitter to Build Buzz

EPC CIGAR COMPANY manufactures and distributes cigars that are hand-rolled in the Dominican Republic from Ecuadorean, Nicaraguan and Dominican tobacco. It has been in business since April, although the family that owns it previously ran a successful cigar company that was sold to Swedish Match in 1999.

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Chester Higgins Jr./The New York Times

Ernesto Perez-Carrillo III, one of three family members who run EPC Cigars, decided to use the Internet and social media for marketing the business.

Did EPC Cigar Pick the Right Marketing Campaign?

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THE CHALLENGE To develop a cost-effective and efficient marketing strategy to promote the company and its new brand, E. P. Carrillo, while building on the family%u2019s legacy.

THE BACKGROUND EPC Cigar, based in Miami, is owned and operated by the Perez-Carrillo family, whose Cuban-born patriarch, Ernesto Perez-Carrillo, established El Credito Cigars in 1968; its best-known brand was La Gloria Cubana. After Mr. Perez-Carrillo%u2019s death, his son, Ernesto Perez-Carrillo Jr., sold El Credito to Swedish Match in 1999, working there until March 2009. Mr. Perez-Carrillo Jr., 58, remains a big deal in the cigar world.

He was encouraged to start EPC Cigar by his daughter, Lissette, 36, a lawyer based in Miami, and his son, Ernesto Perez-Carrillo III, 28, a management consultant based in New York, both of whom had worked for El Credito while growing up. The three family members run the company, which employs 34 people in Miami and the Dominican Republic.

Its first product was a $13 limited-edition inaugural cigar released in December; it will be followed this spring by the core E. P. Carrillo line, which will be available in five sizes priced from $6 to $8.

Last year, Mr. Perez-Carrillo III, who oversees the company%u2019s marketing, hired an advertising agency, DeVito/Verdi, to develop a logo, labels, packaging and a marketing campaign to introduce the new company and its cigars. Mr. Perez-Carrillo III estimates that EPC Cigar will spend $300,000 on the campaign, which began in April 2009 and will run through December.

THE OPTIONS DeVito/Verdi suggested a range of traditional and new-media marketing strategies.

The traditional options included taxi-top advertising in New York City; commercials on cable channels like Comedy Central, Spike and VH1; radio ads in cities like New York, Los Angeles and Chicago; and print ads in publications like The Wall Street Journal, Forbes, Fortune, Yachting, Golf Digest, Wine Spectator and Cigar Aficionado. With the exception of Cigar Aficionado, these promotions would aim at casual cigar smokers and even nonsmokers willing to try the company%u2019s cigars.

The social media options included three Web site concepts: one involved a collage on the company Web site of live, online mentions of the company and Ernesto Perez-Carrillo Jr.; a second featured a world map (from Google Maps) on the Web site that showed the origin of real-time Twitter messages about cigars; and a third would use a Facebook page as the company%u2019s main online presence. In any case, the digital strategy would involve the use of Twitter, Facebook and Flickr.

THE DECISION Ultimately, Mr. Perez-Carrillo III decided to take DeVito/Verdi%u2019s advice and emphasize the Internet and social media initiatives. Ellis Verdi, president of the agency, calls social media %u201Ca natural place to go when you want to show something real,%u201D adding, %u201CIf you say it%u2019s real, people won%u2019t believe you, but the Internet lets you show it.%u201D

Mr. Perez-Carrillo III said his primary objection to traditional media outlets was the expense. %u201CFor the first go-around,%u201D he said, %u201Cwe put them off the table.%u201D The company, according to Mr. Perez-Carrillo III, will spend $40,000 on digital-media initiatives between 2009 and 2010, with the remaining $260,000 of its marketing budget going to trade shows, cigar-enthusiast events, point-of-sale material and some traditional media.

Social media allow the company to communicate directly with cigar buyers, retailers, tobacco growers and others with whom it does business, according to both EPC Cigar and its agency. This is particularly important as the popularity of once-fashionable cigar bars wanes and public smoking bans proliferate.

At the agency%u2019s recommendation, the Perez-Carrillos chose the Web concept based on Google Maps and Twitter. Thus, on the home page, Twitter messages about cigars %u2014 regardless of whether they are about EPC Cigar or raise health concerns about cigar smoking %u2014 appear on a world map that rotates to show where the messages originated.

The site%u2019s %u201CAbout Us%u201D section uses another world map to show places where EPC Cigar conducts business or has roots, thus honoring the family%u2019s history. The section also offers photographs and videos, including a vintage, black-and-white snapshot of Mr. Perez-Carrillo Jr. as a child in Cuba and modern videos of a Nicaraguan tobacco farm.

The site lists retailers that sell the company%u2019s cigars, with Google Maps indicating their locations, and more than 1,000 places to smoke, with recommendations contributed by visitors and by Cigar Places, a Web site for cigar enthusiasts. DeVito/Verdi is in the process of developing an iPhone application that will feature these cigar-friendly places.

The agency has encouraged Mr. Perez-Carrillo Jr. %u2014 and not his son %u2014 to use Twitter to build and communicate with the company%u2019s following. It is Mr. Perez-Carrillo Jr., said Tyler DeAngelo, interactive creative director of DeVito/Verdi, who is %u201Cthe face of the brand.%u201D

While Mr. Perez-Carrillo Jr. posts Twitter messages almost daily, Mr. Perez-Carrillo III maintains the company%u2019s Facebook page, where he posts articles and reviews and encourages fans to comment. There are also links on the page to the company%u2019s Twitter feed, YouTube videos and Flickr photos. Similarly, there is a box that pops up from the home page of its Web site that lets visitors %u201Cfollow Ernesto%u201D on all four social media channels.

THE RESULTS So far, only about 250 people are following EPC Cigar through Twitter and about 700 are Facebook fans. These numbers notwithstanding, the Perez-Carrillo family and DeVito/Verdi say they are satisfied with the campaign%u2019s impact.

%u201CTo have a lot of people talk about the limited-edition cigar after only a few months, in a market that%u2019s challenged, in an industry that%u2019s not really growing, is very exciting,%u201D Mr. Verdi said.

The campaign has %u201Cgenerated a lot of buzz so far,%u201D Mr. Perez-Carrillo III said. %u201CWhen we talk to retailers, to the end consumer, everyone pretty much knows Ernesto%u2019s gone on his own. They can%u2019t wait for him to come out with the core line.%u201D

One unexpected benefit is that Mr. Perez-Carrillo III has been using Google Analytics to track how many people visit the Web site and where they come from. He has discovered that almost one-third of the visitors do not live in the United States. %u201CI%u2019m talking to foreign distributors far more quickly than I expected I would,%u201D he said.

The 25,000 limited-edition cigars that EPC Cigar has been releasing monthly since December %u201Care selling extremely quickly,%u201D Mr. Perez-Carrillo III said. He projects sales of $1.5 million this year.

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