Heather Phillips is the angelic founder and driving force behind Heavenly Cigar Co., a hot contender in the expanding premium flavored cigar market.

By Dale Scott

German immigrant Louis Sievert arrived in Toronto in 1856 and opened a tobacco shop. He remained active in the trade, until his death 62 years later, and the Toronto newspaper reported, "Sievert was probably Toronto's oldest tobacconist." Considered one of America's expert judges of tobacco, the government often sought his advice in its efforts to enlarge and stimulate the industry's growth.

Today, his great-great granddaughter, Heather L. Phillips, has rekindled the family's dedication to fine tobacco. Phillips, at age 32, is the founder and c.e.o. of Heavenly Cigar Company, the Naples, Fla., maker of top-quality premium flavored cigars. Anyone familiar with Heavenly knows Phillips' personality is key to understanding the company's success " even more impressive, considering she entered the business during the challenging days of 1999.

"In 1996, I was working as a cocktail waitress at a posh cigar bar and retail store in Naples," says Heather Phillips. "The more I learned about fine cigars, the more they fascinated me." First, her interest landed her in the humidor, selling cigars. Then, her managerial skills and drive for excellence earned her a position as assistant to the general manager, where she trained the other employees about premium cigars and the business.

With the demise of the bar in 1999, Phillips was out of a job. "Things looked pretty bad," she admits, "but I saw an opportunity, and decided to start my own cigar company. I'm an all-or-nothing person, and I had become passionate about premium cigars and tobacco." Phillips, a classic Leo, has a full mane of flaming, red hair and an outgoing, delightfully open and honest demeanor " excellent traits for a self-made entrepreneur. "People think I'm a big-city business woman," she laughs, "but I'm just a farm girl from Canada, who learned it all the hard way. In the beginning, it was really tough, with only some meager savings and a cheap telephone in my spare room.

What Phillips may have lacked in resources, she more than made up for in her focused vision. "My experience and intuition told me the market craved high-quality flavored cigars," she explains, "so, I decided to build the Heavenly Cigar Company's flavored cigars into a nationally accepted brand, and chose the name for its promotional theme.

Initially, Phillips split her time between calling hundreds of tobacconists on that "cheap phone," and spending time perfecting the product at the factory in Santiago, Dominican Republic. "Heavenly's factory was a morally rewarding experience in itself," recalls Phillips. "At that time, it was threatened with closure, with the workers' families facing the loss of their primary incomes. I fulfilled my commitment to them " at a high financial risk " to bring them solid business so they could remain in operation."

Heavenly eschewed any temptation to cut corners. "I insisted on nothing but the finest tobaccos, the most expert rollers, and tobacco at prices that took advantage of the stockpiles of choice leaf," says Phillips. "All these needed to mesh, because I was determined to produce the finest flavored cigars anywhere on earth ... direct from Heaven!" For months, she and the factory personnel experimented and collaborated, until they had perfected an exclusive five-point flavor process. This resulted in cigars that met her criterion, tasting and smelling exactly like the advertised flavor, all the way to the stub. She is understandably secretive about its details.

Phillips " single, attractive, and new to the industry " ran headlong into the male-dominated arena with the determination and innovation of a woman ready to succeed, even if it meant taking big risks, both financially and creatively. Dealing with the factory's tabaqueros was especially a challenge. "I'd tell them, 'No, no, let's try it this way,' and they'd shake their heads at this gringa loca, with all her strange ideas," she laughs. "But, when the product hit the market, I knew my persistence had paid off. Our cigars were an instant hit, and not only with men... women comprise more than half our market."

First Launch a Success
Months of painstaking experimentation with blends and flavoring processes rewarded Phillips with her first market success, Heavenly Vanilla, in Petite (5 x 30) and Corona (5 1/2 x 46). Plowing every penny of profit into the business, she declined a paycheck for several months. By the end of 2000, Phillips saw the first signs that flavored cigars were a hot new trend, and her sales were up 40% over the first year. Without advertising for the first two years, Phillips built the business on the solid foundation of excellent product, competitive pricing, reliable shipping and customer service, and a 100% product guarantee " fundamentals many fast-track entrepreneurs overlook. "Above all," she states, "I believe in honest business dealings and product claims, because they earn you a reputation that will see you through the long-term ups and downs."

Something changed noticeably in 2001. "Retailers started coming from referrals from other retailers, and even from other established manufacturers," explains Phillips. "Sales grew even faster, up 52% over the figures from 2000. The high quality of the product and the emerging customer demand were the driving forces, but I also believe our credibility was equally important."

With the continued success of Heavenly Vanilla, by the end of the year, Phillips had expanded her flavor collection to include Cupid's Cherry Cream, Angel's Spice (Cinnamon), Raging Rum, and Chocolate Thunder. This year saw the introduction of Heather's Honey Nut, which she says, "Balances the sweetness and low acidity of the finest honey, with the delectable hint of roasted almonds and hazelnuts." The market responded positively, and Phillips reports sales for the first eight months of 2002 are up 60% over the entire previous year. At RTDA 2002, Heavenly Cigar introduced their "seventh Heaven," Aphrodite's Amaretto, as well as the Cherub, a 3 1/2 x 26 Heavenly Vanilla, mini cigar. Like all of the company's cigars, it is hand-rolled, with 100% Dominican tobacco. Box presentation for all of Heavenly's cigars is first-rate, balancing classic lithography-inspired box art with a youthful look. The company recently introduced cigar gift packs, and offers bundled Heaven cigars.

Today, Phillips supports retailers with consistent advertising, including spots on Matt Alan's syndicated "Lighten Up!" cigar-oriented radio show. She also capitalizes on her past experience as a member of a semi-professional dance team, by enlisting many of her friends as "Heaven's Angels." In their gowns and fluffy white angel wings, they're tastefully seductive, and enhance the fun, playful image Phillips has infused into the company. She has trained them all in the product, so they're effective with customers. Because they're all friends, she says she can trust what they'll say and how they'll behave. Understandably, they're hits at shows, and Phillips brings them with her to dealer and other events. They just returned from the recent Michael Jordan Celebrity Invitational Tournament, in Nassau, Bahamas. "We sat and shared Heaven cigars and champagne with some of the biggest names in sports and entertainment," she says. "I thought, 'This is all too cool!'"

Heavenly's web site (www.heavencigar.com) has solved the biggest problem with e-commerce: getting repeat visitors. "It has a calendar with a different Angel pin-up each month," says Phillips. It also features a raffle, with participants receiving free boxes of Heaven cigars every month. "Our Web host says our site is in the top 3% of all their clients' traffic," she adds, "with almost 2,000 hits a day, 20% of whom are repeat visitors." The company also offers monthly discount incentives for retailers. The site, which is informational only, does not sell direct to consumers and will undergo an extensive upgrade next Spring. A free, professionally photographed Angels wall calendar will also be available for retailers and consumers.

"From one flavor and a small client base in 1999, we came to RTDA this year with nine Angels, seven flavors, four Heavenly sizes, exciting, new packaging for all flavors, and even Kona coffee," says Phillips. "The factory has now tripled its production capabilities, including a staff of expert rollers. Our office and distribution facility employs a staff dedicated to the excellence, values, and personal service upon which I founded this company." Heavenly will be exploring new flavors for 2003. But, with the introduction of this year's new products, packaging, and more promotional events, Phillips " who strives for perfection " wants to further develop what she has now.

"With show sales up three-fold over last year, RTDA 2002 was Heavenly Cigars' best show, and gave us our company's best month to date," notes Phillips.

Great-great grandfather would have been proud at how far Phillips has come.

Heavenly Cigar Company, 3760 Arnold Ave., Naples, FL 34104, Tel: (888) 547-1604, Fax: (941) 262-0141, Web: www.heavencigar.com.

SMOKESHOP - Oct/Nov 2002