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Mr. Blanco Goes to China-Chinese Cigar Market
José Blanco is one of the few people in the cigar business who needs no introduction. Not only is he one of the most respected figures in the cigar industry, he’s also a treasure trove of knowledge including everything from growing tobacco, to blending cigars and marketing them.
After a long and illustrious career at Miami Cigar & Co., Señor Blanco spent the last several years in Estelí, Nicaragua working with Dr. Alejandro Martinez Cuenca at Joya De Nicaragua cigars; a meeting of two great minds that resulted in producing the critically-acclaimed CyB (form. Cuenca y Blanco) cigars. When José completed his contract with JDN this past summer, he decided to take some time off for himself and his family.
During this hiatus, José visited Hong Kong and Shanghai as a consultant to several businessmen who sought his counsel on the viability of building a premium cigar business in these two major international cities. Mr. Blanco comments on the current state of the Chinese cigar market. Since a number of Central American manufacturers have recently been seeking new markets for their cigars in Europe and Asia, I asked José about his experience in China. – G.K.
Cigar Advisor: Why did you decide to visit China, and with whom did you travel?
José Blanco: Actually, I was invited to China by some people who are thinking of entering the industry who wanted my input on the viability of the Chinese cigar market. My role was to help them evaluate the prospects of a premium cigar business in Hong Kong and Shanghai. I accepted since, whether or not the prospects were viable, I was sure it would be a most interesting trip. Another factor that encouraged me to go was, I have some contacts there, so I thought this would be a good opportunity to meet them, have some great smokes, and present my blending seminar for some private guests of a friend, which I also did for my friends Lily Wang and Edward Jin at their store, Cigar Ambassador. It was a great travel-opportunity as far as general interest goes, and it did, indeed, turn out extremely interesting.
CA: What did you expect to find in Hong Kong and Shanghai?
José Blanco: Lots of people! [Laughs] But seriously, I simply went with an open mind and no specific expectations. When you don’t know a market, it’s better to enter it objectively and accept everything you can learn.
That said, what I saw impressed me! Cigar smokers know a good smoke, and the variety of age and style of the smokers was huge; just like in the U.S., all types of people can meet and enjoy cigars together all with that same common interest.
CA: How did the Chinese treat you?
José Blanco: Funny question. The Chinese people generally seem very polite and respectful, and we already know that they are very well educated. So, I felt very welcome there, both in Hong Kong and in Shanghai, and by my friends and the new people I just met.
CA: What was the most interesting place you visited?
José Blanco: There were many! First of all Hong Kong is a fantastic city! Very dynamic and multi-cultural. Shanghai felt even more exotic and from all I saw my favorite visit was to the Jing’an Temple. Plus, I have to add that I’ve always loved Chinese food, but it has been nothing near as delicious as the true, native Chinese food!
CA: What are the smoking laws like over there, and where can you smoke?
José Blanco: The majority of bars and restaurants, in fact, all horecas (businesses that serve food & beverages) have smoking and non-smoking sections, but they are not hard and imposing about this, so the smoking-laws there are still very liberal. In Hong Kong they have stricter rules, but that’s about it.
CA: How do cigar prices compare to those in the U.S. and other countries you’ve visited?
José Blanco: Shanghai’s cigar prices are higher than Hong Kong, but overall, cigar prices are much more expensive than in the U.S.; let’s say, more comparable to the European prices, which I don’t compare anyway since cost of living is so different between those two continents. All I can say is that they are much higher than the prices we’re used to paying.
CA: What is the Cuban cigars ratio in Hong Kong and Shanghai compared to Dominicans, Hondurans, and Nicaraguans?
José Blanco: They have many more Cuban cigars than any other countries; percentage-wise, maybe 85% Cuban to 15% other countries. This market is still developing within the cigar-industry, so the Chinese are still very unaware of the great qualities we know to be true about non-Cuban cigars. There are some Dominicans and Nicaraguans, very few Hondurans, and yet, these cigars are very well accepted by those who actually get the chance to discover them.
CA: Do the Chinese have their own domestically-made cigar brands? If so, did you smoke them, and what did you think?
José Blanco: Yes, they have many brands, but to be honest they were not my cup of tea because they lacked sweetness and depth, and some were very one-dimensional in my opinion. That being said, I smoked a new project with a new Chinese wrapper, which in time could be worthwhile for the Chinese market, this one had good spice and more flavor than the other ones I had the chance to smoke there.
CA: What are the cigar-bars/lounges like there?
José Blanco: They are great, and very similar to those in the U.S.; comfortable and classy, with a good selection of smokes. I’d also add that the cigar lounges in China have a better selections of drinks!
CA: How do the cigar smokers in China compare to other countries as far as passion and lifestyle?
José Blanco: First of all, many countries already have very different lifestyle and passions from one another, so I would not compare them in such a way. Cigar smokers around the world enjoy their cigars in accordance with their specific culture. The Chinese culture is very strong and distinct. They have a very fulfilled culture, but as far as cigars are concerned, they still lack knowledge. So, basically, they smoke at the bars and lounges and at home, etc., like many of us.
One thing that is comparable to other developing cigar-markets: the most popular brand is the Cuban Cohiba. What’s interesting is, that both in China and other developing cigar-markets, Cohiba is the most famous brand and the most seen, but not necessarily the best-seller! That is a bit of a mystery, but also not surprising due to its tremendous world-wide brand-awareness.
CA: What surprised you most about your trip?
José Blanco: There is a lot to say about this trip, so to keep it short: Even though I knew that Hong Kong was internationally mixed and very highly developed, it was even more so! So, even more than being surprised, I was impressed! The same goes for Shanghai; it is extremely well-developed, which I expected, since it is a major world city, so here again, I was very impressed. There is so much more to say about these cities. The culture, the food, the feel, the people, the education, so I will leave it at that except to add that there is so much more to learn about this fascinating market!
With regard to cigars, what surprised me the most was the amount of enthusiastic YOUNG smokers! I saw them in shops, the lounges, even at my Blending Seminars, and they seemed especially interested. So, the potential for developing this market is very high.
CA: What’s happening over there in terms of Social Media?
José Blanco: As you know, Social Media in the U.S. and in many other countries is extremely important to our industry. However, in China it’s different. They don’t have Facebook and Twitter, and many more sites as we know (except in Hong Kong, and I think Macau, too, where they have internet access). Basically, within China, they have their own Social Media sites.
CA: Would you visit China again? If so, how soon?
José Blanco: Absolutely! I want to bring my wife and son there, plus, my wife’ parents live in Thailand, so hopefully we can combine a trip some time in the not-too-distant future.
With regard to cigars, I would also go back, for sure! China has a “China Dragon Cigar Festival.” Organized in 2012 by Lily Wang (a.k.a. the “queen of cigars in China”) of Cigar Ambassador, the annual Festival takes place in October-November in both Shanghai and Beijing. It didn’t fit into my plans this year, but hopefully I’ll get to the Festival next year.