Zippo to expand brand into nonsmoking products and branded kiosks, specialty stores

By Subhan Toba On Saturday, April 9, 2011 · Leave a Comment

BRADFORD, Pa. – Zippo lighters have retained their retro cool even as the tiny northwestern
Pennsylvania company that makes them gets ready to celebrate its 80th anniversary and 500millionth
lighter next year.

But with pressure increasing on folks not to smoke, Zippo Manufacturing Co. is hoping to
capitalize on its brand by offering a wider variety of products, such as watches, leisure clothing
and cologne. These would be sold through kiosks and Zippo-

brand specialty stores designed to showcase the durable image reinforced by each distinctive lid
“click” of its brass-encased, lifetime-guaranteed lighters.

Realizing that producing 18million lighters a year in the mid-1990s was probably the company’s
high-water mark – Zippo’s 550 employees will produce about 12million lighters this year – the
company started marketing research before President and CEO Gregory Booth was hired 10years
ago.

The surveys asked consumers the question that Booth must answer today: “What kind of products
could we sell other than cigarette lighters that people would accept as Zippo products?”

The research shows the company could sell other products – if they fit Zippo’s image, which
Booth describes as “rugged, durable, made in America, iconic.”

“It has to be something that feels like Zippo,” Booth said of the travel bags, backpacks,
watches, sunglasses, jeans and leisure shirts, wallets, pens, liquor flasks, outdoor hand warmers,
playing cards and even a fragrance. Manufactured by Italian perfumer Mavive, it comes in a
lighter-shaped canister (and, yes, a lid that clicks).

Marketing experts said all that makes sense, provided that Zippo’s new products stay true to the
brand – and that the company learns quickly that selling jeans, or any other product, comes with a
menu of business complexities.

“A brand is just a story attached to a product. Like any narrative, it carries sensation.
Zippo’s story is ‘manly independence,’” said James Twitchell, a marketing expert whose book
Lead Us Into Temptation: The Triumph of American Materialism argues that Americans have
increasingly turned to brand names instead of religion for their identity.

“As long as this narrative is in place, it can be attached to any other product as long as the
product doesn’t contradict the story line,” Twitchell said, noting that Eddie Bauer-branded SUVs
stay true to the sportswear company’s image of “wanderlust.”

Another branding consultant who founded the self-named PaulJLucas.com in Washington, D.C., said
Zippo’s plans remind him of the success that Victorinox Swiss Army Brands Inc. has had selling
watches, luggage, clothing and fragrances.

“It’s all high-quality, and they did it right, and I buy their stuff,” said Lucas, noting that
Swiss Army luggage is as rugged as its trademarked multipurpose knives.

But not any brand – even American icons – can be used to sell just anything.

“Harley-Davidson once, believe it or not, tried to sell bottled water, and it just tanked,”
Lucas said.

His advice is to stick to products closer to a brand’s core. That’s why he likes Zippo’s
still-on-the-drawing board plans for patio gas grills but isn’t so crazy about the idea of Zippo
cologne, noting that lighter fluid is the only other liquid odor associated with Zippo.

Booth insists that Zippo’s plans are built on solid market research and, perhaps as important,
fueled by necessity.

“We recognize there’s a lot of pressure on smoking, and it’s only gotten worse in the last 10
years,” Booth said.

Zippo aggressively markets its lighters to collectors, aficionados and even nonsmokers, offering
more than a dozen models in hundreds of colors and unusual designs. Although the lighters are
generally plated with nickel chrome, some are covered with gold or platinum.

Booth thinks that those varieties can take the company only so far.

“We knew we were invested in an industry that was under pressure, and knew we could go the way
of the Hula Hoop and not do anything about it,” Booth said.

Instead, Zippo hired David Warfel as its director of global marketing three years ago, to
capitalize on his branding experience with Xerox, Kodak and Ray-Ban.

Zippo already sells its lighters in more than 160 countries – but it does so through wholesalers
and other distributors.

Warfel was hired to take control of the Zippo “brand” and expand it, at first abroad and then
gradually in the United States.

The newest wing of the company’s headquarters 130miles northeast of Pittsburgh is a showcase for
Zippo’s plans. It features a Zippo kiosk and what’s known as a “shop-in-shop” – a tiny Zippo store
meant to take up residence in a larger department store – and a prototype Zippo specialty store,
which the company plans to put in shopping districts abroad.

All three retail spaces feature custom-designed black-framed glass showcases that “fit together
like Legos” so retailers can create their own “Zippo area” in just about any size space, Warfel
said.

Zippo will push its expanded product line abroad, at first, because foreign consumers are
familiar with the brand’s durable image without it being “almost umbilically tied to cigarette
lighters,” Booth said.

U.S. consumers “are so tied to Zippo lighters that it’s tough for the customer to make the jump
to these other products,” he said.

Although Zippo plans to open a kiosk at Kennedy International Airport in New York City this
month, most Zippo outlets will arrive first in China, other parts of Asia or western Europe. It
doesn’t hurt that Asia remains a key smoking market, with China consuming one-third of the world’s
smoking tobacco, something that Booth calls a “monstrous opportunity” for Zippo to grow.

In 18 months or so, Zippo hopes to open more stateside retail outlets, in places such as Las
Vegas and Niagara Falls, N.Y., Warfel said.

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