Luxury Cigar Market

• A rise in luxury hotel establishments that comprise premium cigar lounges is driving the market growth

Over the course of the projection period, a surge in high-end hotel facilities with premium cigar lounges is anticipated to positively affect market expansion. Furthermore, it is projected that millennials' rising cigarette use will accelerate market expansion. The tobacco business has suffered as a result of the COVID-19 pandemic. Global sales dropped by 20%–30% from March to April 2020 as a result of factories and stores closing as a result of severe lockdown regulations. Businesses have been favourably responding to the situation by providing upscale cigars online, since consumers preferred online purchase over offline due to security concerns.

The demand for luxury cigars is rising, particularly among millennials and high-end smokers. According to a USDA study, cigar sales in the United States brought in USD 28.48 per person in 2019 and USD 30 in 2020. The emergence of numerous high-end cigar lounges throughout the world in recent years has increased demand for luxury cigars, which are mostly smoked at high-end lounges.

According to a study by Cigar Journal, there were more than 4,553 cigar lounges open in the United States as of 2020, and this number is anticipated to grow in the years to come due primarily to a rise in the social acceptance of smoking and a rise in consumer preference for cigars with a smoother taste. Furthermore, cigarette consumption has increased significantly year after year all throughout the world. According to a World Health Organisation report, the number of men who smoke increased to over 40 million from 1.05 billion in 2000 to 1.09 billion in 2018.

The study also showed that despite the global goal of more than 32 countries to reduce tobacco consumption by 30% by 2025, based on current efforts, only a reduction of 23% could be accomplished, highlighting the sharp increase in cigarette usage. Thus, one of the key reasons influencing the demand for premium cigars is the increase in tobacco usage.

Future market expansion for luxury cigars is anticipated to be driven by millennials' rising tobacco consumption. The chemical nicotine, which makes individuals feel good while diverting their attention from bad thoughts, is to blame for the surge in tobacco consumption among younger wealthy adults, which in turn raises the market for high-end cigars. For instance, wholesalers and retail chains sold 203.7 billion cigarettes overall in 2020, up from 202.9 billion in 2019, according to the Federal Trade Commission 2021, a US federal body. The market for luxury cigars is therefore driven by millennials' rising tobacco use.

In the market for luxury cigars, technological developments have become a prominent trend that is growing in popularity. To strengthen their position, major businesses in the luxury cigar industry are concentrating on creating new technological solutions. Thus, driving the Luxury Cigar market revenue.

The Global Luxury Cigar Market Industry is projected to experience substantial growth, with estimates suggesting a market size of 27.6 USD Billion by 2035. This growth trajectory indicates a robust demand for luxury cigars, driven by various factors such as increasing consumer affluence and evolving preferences. The anticipated CAGR of 7.46% from 2025 to 2035 further underscores the market's potential for expansion. As brands innovate and adapt to consumer trends, the market is likely to attract a diverse range of consumers, enhancing its overall appeal. This growth projection serves as a testament to the enduring allure of luxury cigars in the global marketplace.

The Global Luxury Cigar Market Industry is witnessing a shift in consumer preferences, with a growing inclination towards artisanal and handcrafted cigars. Consumers are increasingly seeking unique flavors and experiences, leading to a demand for limited-edition releases and boutique brands. This evolution reflects a broader trend towards personalization in luxury goods, where consumers desire products that resonate with their individual tastes. As a result, manufacturers are adapting their offerings to cater to these preferences, potentially driving market growth. The anticipated CAGR of 7.46% from 2025 to 2035 indicates that this trend may significantly influence the market dynamics in the coming years.

Cigar lounges have emerged as a significant trend within the Global Luxury Cigar Market Industry, providing consumers with exclusive environments to enjoy premium cigars. These lounges often offer a curated selection of high-end cigars, paired with fine spirits, creating an elevated experience for enthusiasts. The rise of such establishments contributes to the overall growth of the market, as they attract both seasoned aficionados and newcomers alike. The increasing number of cigar lounges worldwide suggests a shift in social culture, where luxury cigars are not merely products but part of a lifestyle. This trend is likely to bolster the market's expansion, enhancing its appeal.

The Global Luxury Cigar Market Industry experiences a notable increase in demand driven by rising affluence and disposable income among consumers. As individuals attain higher income levels, they are more inclined to indulge in luxury products, including premium cigars. This trend is particularly evident in emerging markets where a burgeoning middle class seeks to elevate their lifestyle. For instance, the market is projected to reach 12.5 USD Billion in 2024, reflecting a growing consumer base willing to invest in high-quality cigars. This shift in consumer behavior indicates a robust potential for growth in the Global Luxury Cigar Market Industry.

The Global Luxury Cigar Market Industry is significantly affected by the regulatory environment and trade policies governing tobacco products. Various countries impose strict regulations on the sale and marketing of cigars, which can impact market dynamics. However, favorable trade agreements and policies can facilitate market access and growth opportunities for luxury cigar brands. For instance, regions with less stringent regulations may experience a surge in demand, allowing brands to expand their reach. Understanding these regulatory frameworks is crucial for stakeholders aiming to navigate the complexities of the Global Luxury Cigar Market Industry and capitalize on emerging opportunities.

Social media and influencer marketing play a pivotal role in shaping the Global Luxury Cigar Market Industry. Platforms such as Instagram and YouTube have become essential tools for brands to showcase their products and engage with consumers. Influencers within the cigar community often share their experiences, creating a sense of exclusivity and desirability around luxury cigars. This digital presence not only enhances brand visibility but also fosters a community of enthusiasts who share their passion for cigars. As the market continues to evolve, the influence of social media is likely to remain a critical driver, attracting new consumers and expanding the market further.

By region, the study provides the market insights into North America, Europe, Asia-Pacific and Rest of the World. The North America Luxury Cigar Market dominated this market in 2022 (45.80%). Customers in North American nations like the U.S. and Canada are prepared to spend a lot of money on unusual premium cigars. Another element that is anticipated to support demand is the existence of reputable luxury cigar producers in North America, such as Rocky Patel Davidoff of Geneva and Altadis USA. Further, the U.S.

Luxury Cigar market held the largest market share, and the Canada Luxury Cigar market was the fastest growing market in the North America region.

Further, the major countries studied in the market report are The US, Canada, German, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 2: LUXURY CIGAR MARKET SHARE BY REGION 2022 (USD Billion)

Source: Secondary Research, Primary Research, Market Research Future Database and Analyst Review

Europe Luxury Cigar market accounted for the healthy market share in 2022. It is anticipated that the expansion of the tobacco sector in Germany and the United Kingdom, both of which enjoy legislative support, will guarantee ongoing production of luxury cigars and, as a result, be a favourable factor for the market growth in the Asia Pacific over the forecast period. Further, the German Luxury Cigar market held the largest market share, and the U.K Luxury Cigar market was the fastest growing market in the European region

The Asia Pacific Luxury Cigar market is expected to register significant growth from 2023 to 2032. The majority of smokers worldwide are concentrated in Asia and the Pacific. According to a World Health Organisation report, Chinese smokers made up more than 25.0% of the world's smokers as of 2020. Moreover, China’s Luxury Cigar market held the largest market share, and the Indian Luxury Cigar market was the fastest growing market in the Asia-Pacific region.

Leading market players are investing heavily in research and development in order to expand their product lines, which will help the Luxury Cigar market, grow even more. Market participants are also undertaking a variety of strategic activities to expand their global footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, Luxury Cigar industry must offer cost-effective items.

Manufacturing locally to minimize operational costs is one of the key business tactics used by manufacturers in the global Luxury Cigar industry to benefit clients and increase the market sector. In recent years, the Luxury Cigar industry has offered some of the most significant advantages to medicine. Major players in the Luxury Cigar market, including Fuente Marketing Ltd., General Cigar, Regius Cigars Ltd., Gurkha Cigar Group, Gran Habano Cigars, Mayan Import, The Villiger Group, Altadis, Rocky Patel Premium Cigars, and Swisher, are attempting to increase market demand by investing in research and development operations.

A company called HumidifGroup specialises in creating packaging and accessories for the cigar industry. Our group has developed what we consider a specialised diversification after more than 30 years in the market. The variety of products and materials available to us allows us to create a wide range of customised articles for our customers. ensuring that all of client requirements are met, thereby producing a unique product that is especially tailored for them.

A US-based firm called HumidifGroup USA, which specialises in the creation and design of packaging and accessories for the cigar industry, introduced Ferio Tego Cigar Co. in September 2021 using smart packaging technology. Smart packaging immerses the end-user in knowledge, stylish films, and education with only a swipe of the phone.

The Scandinavian Tobacco Group A/S (STG) manufactures traditional pipe tobacco and cigars. It sells pipe tobacco, handmade cigars, cigars created by machines, fine-cut tobacco, CMA cigars, fire accessories, tubes, and paper. Under the names Cao, Captain Black, Cohiba, Erinmore, Escort, Hajenius, Henri Wintermans, La Gloria Cubana, LA Paz, M BY Colts, Panter, Partagas, Petit, Signature, and Tiedemanns, the company sells tobacco goods. Tobacco products are distributed by STG to wholesalers and distributors via sales offices. Operating regions for the company include the Americas, Oceania, Asia-Pacific, Europe, and Africa. Denmark's Gentofte serves as the home base for STG.

Moderno Orifice del Sigaro Italiano (MOSI) was acquired by Scandinavian Tobacco Group A/S, a manufacturer of cigars and traditional pipe tobacco with headquarters in Denmark, in November 2021 for an unknown sum. With this acquisition, the business increases its market share in the machine-rolled cigar market in Italy and strengthens its position as the industry leader in Europe. Machine-rolled cigars are created by the Italian company Moderno Orifice del Sigaro Italiano (MOSI).