Premium and Pointless: How the Cigar Industry Is Pricing Itself Out of Existence

By Jonathan Lipson | Founder & President | The Cigar Profit Consulting

Preface: Marketing to Ghosts

This article isn’t a reversal of the messaging found in “It’s Time for Cigar Enthusiasts to Look at This Industry a Different Way”. If anything, it reinforces it. The cigar experience still matters. It always will. But when the experience comes with a price tag, that price needs to make sense - not just sound expensive. Not just echo the noise.

Greed without restraint nurtures hubris.

I am a Capitalist, and this is a free market. As Gordon Gekko would say: “Greed is Good!” I don’t disagree with the sentiment, but there is a limit.                                                  Greed without restraint nurtures hubris.                                                          And for anyone familiar with the movie “Wall Street,” any work mirroring a Greek tragedy, or real-life examples like Enron… Oh boy do the mighty fall.

So let’s call a spade a spade: the world is marketing to the ultra-wealthy so aggressively, it’s not even aspirational anymore. It’s just noise. Detached. Tone-deaf. Blasted from every angle like the entire audience actually lives in a penthouse on Park Ave - or wants to.

Here’s what the data actually says:

• The United States has 902 billionaires. That’s less than one in every 400,000 people.

• There are 22 million millionaires. Sounds like a lot… until you realize that’s just 6.3% of the country.

• The average household income in 2025 is $61,984.

• The median personal income hovers around $40K.

• 37% of American couldn’t cover a $400 emergency expense with savings alone.

• The U.S. population? Roughly 347 million people - most of them nowhere near these marketing fantasies.

So why does every product, ad, influencer, and luxury brand push sound like it's made for that top 1%? It seems like brands forgot who their real customer is. It seems like we’ve replaced smart segmentation with blanket prestige. It seems like we’re all in the business of talking past the people who actually keep the lights on.

“How are we supposed to afford that?” “How is that sustainable?” “How does that scale?”

Good questions. No good answers. Just the same recycled talking points: “Tariffs. Labor. Premium materials. The market demands it.”

No - it doesn’t. Want a benchmark? Look no further than LVMH's 5-year stock chart or last few quarterly reports.

Here’s the truth: Most Americans aren't living like TikTok influencers or Wall Street tycoons. They're budgeting. They're balancing. They’re buying when it makes sense - not just when it glitters.

But marketers forgot how to speak to them. Worse, brands stopped trying.

Instead, we’ve got PR teams pushing $1,500 handbags made out of recycled plastic and “sustainable” shoes promoted by social media personalities who drive G-Wagons to pick up $8 matcha in paper cups while complaining about carbon footprints.

We’ve got real estate builders hawking plywood-and-drywall homes like they’re palaces - charging a premium for products that might not survive the mortgage term.

We’ve got entire industries - cigars included - using “premiumization” as a smoke screen for price hikes. Worse, they do it with a straight face… then act shocked when the average customer walks away.

But maybe it’s not the customers who’ve changed. Maybe it’s the brands. Maybe it’s the leadership. Maybe - just maybe - it’s the marketing itself.

There’s a gap in the market. A real one. Not just in product - but in tone. In strategy. In reality.

And the entrepreneurs who see it - the ones who understand volume over vanity, reach over rich lists, and relationships over press releases - they’re going to win. Not tomorrow. Not eventually. But fast.

Because while the rest of the industry is shouting at ghosts...The smart ones are quietly building businesses that talk to real people.

Cigar Makers: You Think You’re Winning, But You’re Not

Everyone in this industry wants to play luxury. Every brand wants to tell you they’re exclusive, handcrafted, ultra-premium. Many make the bands shinier, the boxes heavier, the stories thicker, or maybe they didn’t make changes at all!  But the price tags? Inflated beyond logic. But let’s be honest: this isn’t strategy. It’s theater. And a bad one at that.

Because what’s really going on isn’t innovation or growth. It’s cover.

Cover for bloated operations. Cover for poor supply chain decisions. Cover for failing to forecast basic economic shifts. Cover for not knowing how to negotiate.

And instead of owning that, what do they do? They slap a “Reserva” or “Anniversary” on the label and add five bucks. They scream “limited” while pushing thousands of boxes into distribution. They cry about tariffs, FET, logistics, or raw materials - as if they had no time to prepare for any type of market shift. But that’s the giveaway, isn’t it? They didn’t prepare. They’re reactive. Scrambling. Grasping at margin by pushing the burden onto the customer… and calling it luxury.

Here’s the ugly truth: the middle-class smoker - the one who buys consistently, loves the culture, and built this industry - is getting pushed out. Not because he can’t appreciate a great cigar, but because too many brands decided that chasing Habanos pricing without Habanos leverage was a smart play.

It’s not. It’s a suicide pact.

And the smart operators know it. They're watching the egos overplay their hands. They're staying lean. They’re building brands with real value and scalable models - brands that don’t need to slap a $30 sticker on a $9 experience to stay alive. And when this bubble pops - and it will - it’s those operators who are going to own what’s left.

You think you’re elevating. You’re just alienating.

You’re Not Habanos – and That’s Not a Bad Thing

Somewhere, someone decided that if Habanos could 3x or 10x their pricing overnight and still thrive, then every premium cigar company with a romantic backstory and a color-corrected farm photo could do the same.

That’s a fantasy. And it’s costing the industry real customers, real respect, and real staying power.

Habanos didn’t get there by putting out press releases and tweaking MSRPs. They got there by owning the sandbox. Cuban cigars are contraband luxury. Government-sanctioned scarcity. You don’t compete with that by playing dress-up in a free market where anyone with a few bucks, a supplier, and a credit card processor can launch a brand next month.

But somehow, the message got lost. And here we are - in the middle of a price hike arms race with no logic and no brakes.

Retailers are getting those emails: “Hey, your prices are going up 8% across the board." Then - two days later - “Here’s a Buy 8, Get 2 deal on the SKUs you haven’t been able to move in six months.”

You want to talk about insulting? That’s not premiumization. That’s desperation wearing a $40 price tag.

And guess who’s footing the bill? Not the brand. Not the factory. The retailer. The one who stuck with you. The one who carved out shelf space for your cigars. Who ran events. Who educated their staff and hand-sold your product while you were off “announcing new luxury initiatives” at sales meetings, trade shows, and media interviews.

And when the price hike hits and the box sales slow down, who’s holding the dead inventory? That same retailer.

All while your sales rep is too busy pushing the new brand-within-a-brand vanity project to explain why last year’s blend is suddenly “ultra-premium.”

Let’s be real: If your only justification for raising prices is that everyone else is doing it, you’re not premiumizing - you’re freeloading off an unsustainable trend and hoping nobody notices.

But they notice. Retailers notice. Distributors notice. Consumers especially notice.

And the truth is, when the facade cracks - and it will - the only thing separating the survivors from the write-offs will be who stayed grounded, who knew their lane, and who respected their customer at every tier.

You're not Habanos. You're something better - if you stop chasing their model and start owning yours.

You Burned the Consumer - And He’s Not Coming Back

The middle-income cigar smoker - the one who built this industry - is done playing your game.

He’s not confused. He’s insulted. He didn’t wake up one morning and forget how much his favorite cigar used to cost. He remembers when it was $8. Now it’s $14. Same blend, same band, different story. And none of it adds up.

You told him it’s the wrapper cost. Or the box. Or the tariffs. But he sees what’s really happening.

He watches you launch new “elevated” blends with sleek bands and bloviated stories - while quietly discontinuing his favorites or pricing them into extinction. He watches you create demand through scarcity, jack up MSRP, and then pat yourself on the back for “premiumizing the portfolio.”

He’s not just rolling his eyes - he’s walking out.

He’s tired of being treated like a stepping stone on your climb to 1%’er status. Tired of being told his loyalty isn’t valuable enough unless he plays along with inflated pricing and pretentious positioning. He built your brand when no one knew your name. He kept buying when others moved on. And now you treat him like a problem?

You didn’t give him a better experience. You gave him excuses. You didn't elevate your product - you isolated your base.

And it’s not just about price. It’s about respect. It’s about trust. You told him he’s not the customer you want anymore. So he’s telling you the same.

He’s canceling his exclusive insider membership on your fans page. He’s skipping your limited release. He’s lighting up something else - something real.

He’s not posting about it. He’s not ranting. He’s just done. And he’s not alone.

Thousands like him are quietly stepping off the ride - because they never asked for Cuban prices or contrived luxury. They asked for honest cigars, made by people who cared more about flavor than flash.

You lost him chasing a fantasy. And you’ll feel it when the hype fades and your reorder sheets start drying up.

This isn’t a warning. It’s the wake-up call you missed while you were busy raising prices and lowering trust.

Chasing Labels, Losing Loyalty – The Collapse of Brand Identity

You weren’t supposed to become another clone on the shelf. But in your race to “premiumize,” you traded in the one thing that actually made you matter: identity.

Your brand used to stand for something. Flavor. Consistency. Grit. Maybe even rebellion. You had advocates - not just customers. People who rode with you through bad crops, slow years, and shipping delays. Why? Because they believed you gave a damn.

Then one morning, they woke up and your core line was buried behind a shiny new sub-brand with a $19.99 price tag and a box that looked like it jumped off the page of a cologne ad.

You don’t stand out anymore. You blend in. Same fonts. Same marketing copy. Same “luxury” messaging about craftsmanship, passion, and legacy - served up with zero principle and a 40%-off closeout with one of the “Big Three” e-comm companies when the brand “doesn’t work.”

You thought premiumizing meant copying the gold-foiled elite. But copying isn’t premium - it’s pathetic. Real premium comes from conviction, not cosmetics.

You built your name on flavor, hustle, and a mission statement. Now you’re hiding behind made-up narratives, thinking “elevated storytelling” will mask the fact that your product hasn’t improved - only the markup has.

Your die-hard customers? They see it. Your retail partners? They can’t even tell your SKUs apart anymore. Your sales reps? They’re tired of pitching brands that sound like copy-paste luxury look-books.

You became forgettable trying to look important.

And here’s the truth you refuse to face: Premium doesn’t mean expensive. It means worth it. And you’re not worth it anymore - not to the people who made you.

Keep Your Press Release. Talk to Your Customers.

Let’s kill a lie once and for all: “Any PR is good PR.” No, it’s not. Especially when it’s broadcasting weakness.

If your grand strategy for managing a price increase is a quote on Halfwheel or a line in some puff-piece industry blog - congrats, you’ve just told your actual paying customers they come second.

Retailers don’t want to read about your price hikes in the press. Wholesalers don’t want to scroll past your excuses in their feed. And your reps sure as hell don’t want to explain why their accounts are learning about it in public.

That’s not strategy. That’s scrambling. That’s damage control disguised as communication.

If you're raising prices? You don’t need to tell the whole world. You need to tell the people who carry your product, move your cigars, and build your brand at street level. Directly. Personally. Proactively.

You want to talk “transparency”? Here’s what it looks like:

• You call the people who matter.

• You explain the why.

• You offer a solution, not just a headline.

  And you do it before the blog posts go live.

  
  

Because if they’re learning from the media instead of from you? They’re already halfway out the door.

Let your partners tell your story. Let your reputation be built in the field - not on a website begging for eyeballs.

But if you’ve burned your credibility so badly that a press release feels safer than a phone call? That’s not transparency. That’s you admitting you’ve already lost control.

The Flood Is Coming - And the Smart Ones Know Exactly Who They're Building For

The warnings are everywhere - on shelf space, on open-to-buy limits, in conversations you’re not being invited to anymore. A storm is coming. One you helped build.

You’re watching volume shrink. Watching accounts tighten. Watching consumers quietly - and sometimes not so quietly - walk away. And you still want to blame tariffs? Shipping costs? The economy?

Stop it.

This isn’t about macroeconomics. This is about you and the choices you made.

You saw an opportunity to raise prices, so you did. You saw “luxury” trending on Instagram, so you tried to fake it. You changed your packaging before you improved your product. You blamed everything and everyone - except your own leadership.

But guess what? The market doesn’t care about your excuses. It doesn’t care about your sob story press release about costs “no longer absorbable.” That’s not strategy. That’s panic PR.

The ones who win in business don’t hide behind price sheets. They design the model, not react to it. They forecast, adapt, build margin without betrayal. They find ways to negotiate better rates, smarter partnerships, scalable growth - and they never lose sight of their core.

And that’s what separates the survivors from the sobbers.

Because when this flood really hits - and it will - the shelves are going to clear. Not for the brands that screamed “premium” the loudest. But for the ones that quietly kept delivering value. The ones that said, “We know who we’re building for, and we’re not chasing noise.”

This shakeout won’t be slow. It will be sudden. And it will be unforgiving.

So if your whole brand strategy is built on blaming factors you don’t control, you’re not just behind - you’re already done.

But if you're the one who stayed true to the customer… who learned to negotiate smarter… who refused to join the price-fixing parade just to impress the luxury lifestyle echo chamber?

You’re not just going to survive. You’re going to own the market they abandoned.

For Those on the Sidelines - The Gap Is the Goldmine

If you’ve been waiting for the perfect time to enter this business - this is it.

While the old guard is chasing each other in circles trying to premiumize, rebrand, and explain away every misstep to a handful of media outlets or in the comments section of a social media post, they’ve taken their eyes off the one thing that actually keeps this business alive: value to the end customer.

They’re bloating prices, bottlenecking production, and misaligning with retailers - all in the name of looking expensive instead of building sustainable, respected businesses.

Which creates a vacuum. And that vacuum is your opportunity.

Because right now, there’s a growing segment of retailers begging for better product at a fair price. There’s a consumer base - especially in the middle-income bracket - who still loves cigars but doesn’t love being priced out of their own passion. There are wholesalers and distributors frustrated with inventory that doesn’t move.

They don’t need another “luxury story.” They need smart partners who show up with strategy, not ego. Partners who understand operations, margin control, and real growth - not vanity plays.

And that’s where you come in.

If you’ve got vision, if you’ve got the skill set, if you’ve got the work ethic - then step up. The moat around this industry isn’t as deep as it looks. And right now, it’s full of builders using toothpicks instead of bricks.

There is market share to take. There are partners looking for you. And there’s a hell of a lot more upside in serving the ignored than chasing the elite.

You just have to stop waiting for someone to give you permission.

Enter the market. Take the gap. Build your lane.

And when you’re ready to get serious? The Cigar Profit is here to make sure you do it right.

Wake Up or Get Wiped Out

Let’s stop coddling the industry.

You want the truth? The premium cigar industry has gotten lazy. Reactive. Bloated with ego and bad assumptions. People are pricing like they’re LVMH and planning like it’s still 2019. You’re not competing on quality anymore - you’re playing musical chairs with price tags, hoping someone buys before the music stops.

Spoiler: the music is about to stop.

This isn’t Habanos. This isn’t a monopoly. This is the most saturated premium cigar market in the world. And yet, brands are acting like basic fundamentals don’t apply. No SKU discipline. No supply chain foresight. No negotiation backbone. Just markup and pray.

Costs go up? Cry on Facebook. Sales slow down? Blame the reps. Product sits on shelves? Drop another limited edition with a shiny band and a made-up backstory.

You don’t need another sub-brand to help offset a loss. You need a business model.

The brands bitching the loudest about “not being able to eat the cost” are just telling on themselves. You didn’t forecast. You didn’t build in margin. You didn’t build anything. You just reacted. That’s not leadership. That’s amateur hour.

The real brands - the ones who are going to eat your lunch when the correction hits - they’re not making excuses. They’re making moves. They’re tightening ops. Locking in prices. Auditing vendors. Working their numbers until the math actually works.

They’re not lying to themselves about what the market can bear. They’re listening. They’re

adapting. And they’re staying profitable.

Meanwhile, too many of you are floating in a fantasy where “premium” means charging more while delivering less. Where every cigar needs to be $20+ to feel relevant. Where every bump in the road is someone else’s fault.

That’s how you get left behind.

Because the customer? They’re not confused. They’re calculating. They’re cutting back. They’re making smarter decisions than the people running some of these companies.

And when the next hit comes - and it will - it’s not just going to shake out the small guys. It’s going to expose the big ones who grew fast and dumb. The ones who chased image over infrastructure. The ones who thought hype was a moat.

It’s not.

The moat is planning. Margin. Strategy. Discipline. Negotiation.

So, if you’re sitting on overpriced inventory, still blaming FET and the price of packaging materials - look in the mirror. That’s the problem. You. Not the tariffs. Not the market. Not the Fed.

You didn’t negotiate. You didn’t plan. And now you’re losing.

Want to survive?

Then grow up. Get serious. Operate like a business, not a brand fantasy. Put your damn ego down and fix your numbers. Because if you’re not part of the solution - if you’re not raising the bar - you are the dead weight that’s dragging this industry down.

And we’re not going to lie to make you feel better about it.

This is The Cigar Profit Insights.

Now act like you want to be in the game.

Don’t Adjust - Lead.

If you’re reading this and feeling uncomfortable, good. That means you know this was about you.

But here’s the part no one else will tell you:

You can still fix it.

You can reverse course. You can stop following bad playbooks and start building your own. You can stop hiding behind tariffs, taxes, and “global uncertainty” and start renegotiating, re-strategizing, and recommitting to the people who built your business.

Or you can keep pretending a fancier band and a $5 price bump is a brand strategy. You can keep calling the media instead of calling your retailers. You can keep marketing to yourself while the middle-income customer - the one who built this industry - walks away.

Your choice.

But know this: The smart ones are already planning for your fallout. They’re watching. They’re waiting. And when the market corrects - and it will - they’ll be the ones still standing.

So here’s your final ask: Don’t tweak. Don’t excuse. Don’t adjust. Lead. Or move out of the way.

Because The Cigar Profit doesn’t just see what’s coming.We’re helping the ones who will survive it. Book your exploratory call today.