NEW YORK (AdAge.com) -- Paragon of Rust Belt manufacturing and an icon since World War II, Zippo wears its American-ness on its sleeve. So does its VP-sales and marketing, Mark Paup, who has spent his entire 15-year career at Zippo and now leads all sales, marketing, design and product development for the Bradford, Pa.-based company. A smoker who rides a Soft Tail Nightrain Harley, you could say Mr. Paup, 44, fits the psychographic of the Zippo consumer.
Mr. Paup started out in the Zippo Manufacturing Co.'s licensing department, where he cut deals with the likes of Harley Davidson, Nascar and Jim Beam. He later spent time building Zippo's overseas business in Europe, where it is a luxury brand and appears on bags, jewelry, pens and apparel.
Now reporting directly to CEO Gregory Booth and overseeing the closely held company's $6 million to $10 million marketing budget, he's charged with finding new markets for the brand while weaving it tightly into subcultures beyond smoking, such as music and motorsports.
Social media is the focal point of Mr. Paup's marketing strategy right now. Proof positive of Zippo's continued brand relevance is its ubiquitous iPhone app, created by Moderati, which has been downloaded 5 million times. Zippo is actively participating in social networks under the handle ZippoDude1932, and it has launched a Facebook page, which is getting an app with a Twitter feed created by Buffalo-based indie agency 15 Fingers. But by far the most popular Zippo-themed Facebook page has nothing to do with the company. (Memo to Facebook user "Zippo:" The guys in Bradford would like to speak to you.)
But the question remains as to whether Zippo can participate in the conversation with its core audience of 18- to 34-year-old males and whether that will translate to a needed sales boost. It's weathered the anti-tobacco movement, airline regulations that for years after 9-11 kept lighters off planes and floods of knockoffs from China, but the 67-year-old company's U.S. sales are down 7% so far in 2009, after remaining flat in 2008. The company, which produces 10 to 12 million lighters a year, laid off 117 employees in the past year.
Still, Zippo expects to sell its 475 millionth lighter this year. It continues to diversify its offerings, broadening its base in the United States beyond its core of smokers with "multi-purpose" lighters sold in places like Bed Bath and Beyond. It even has a line of outdoor products planned, to be sold in outlets such as Dicks, REI and True Value.
In an interview with Ad Age, Mr. Paup discussed Zippo's new markets and how it's capitalizing on brand affinity on Facebook and Twitter.
Ad Age: Zippo is synonymous with lighters; can the brand be something more?
Mr. Paup: Flame is our core competency, but we've already proven we can move into other flame-related products. Our biggest success has been with the female audience in accounts like Kohl's, Target, Yankee Candle and Bed Bath & Beyond. These would be establishments that would not be selling Zippo pocket lighters. We've done a lot of research that tells us we can extend into the outdoor market in various categories in flame, such as heat- and safety-related gear, barbecuing on the patio, and possibly grills.
Ad Age: How do you increase lighter sales when smoking is in steady decline, or is that no longer the goal?
Mr. Paup: Lighter sales are what feed us every day. We know it is a declining market, but it is still a large market. Our objective is to continue to drive and increase our share in a declining market. If we can do that there is still a healthy, viable business for us.
Ad Age: How is the effort to have 50% of your revenue come from non-smoking products by 2010 going?
Mr. Paup: We were sidetracked a bit. We're moving into camping; we bought Zippo Fashion Italia and W.R. Case & Sons Cutlery Factory. There was also a major development in our core lighter business, the Zippo Blue Butane Lighter. We wanted to make that in the United States, but it took us longer to develop than we anticipated. This is a much higher-end refillable butane product that appeals to a cigar smoker. But it wasn't a great time to introduce new products in the market. We could have gone to Asia and easily sourced this product, but we wanted to make sure we could stand by it with our lifetime guarantee and say it was made in the USA.
Ad Age: Who is the Zippo buyer and how do you reach that person?
Mr. Paup: We call him "Sean," an 18- to 34-year-old high school grad with maybe some college. He loves music, doesn't go anywhere without his iPod. That is the universal lifestyle we look at and what ties it all together. It is a place in which we can stay relevant, engaged and in support their lifestyle, and they will support our brand. [To cultivate that target,] we started several years ago with the concept for the Zippo Hot Tour. With it, we were supporting bands and they could upload music to our website and they could vote on it. We sponsored the rock stage for several years. This year we tied in with Live Nation in 10 markets for 200 shows. ZippoEncore.com, a partnership with Rolling Stone and Shinedown, further ties Zippo to music. We're also giving away a Harley and the company is offering two exclusive Harley Davidson lighters on the site.
Ad Age: Your iPhone app was released last September and has become one of the Apple Store's most popular. Does it have staying power?
Mr. Paup: We do see people continue to use it and recommend others to get it as well, which is encouraging. There is a novelty factor, and there may be a short period when they actually use it. We are looking to release an update before year-end with a concert mode, a left-handed version, and perhaps trying to monetize it -- by upselling some designs that aren't available on the free version that we license with artists or brands or other properties.
Ad Age: Your official Facebook page is dwarfed by one set up by Zippo fans. Have you tried to work with your fans on Facebook, and perhaps partnering with them, as Coca-Cola did earlier this year?
Mr. Paup: We are discussing that and contemplating that right now. We haven't been able to contact him, but we're checking with Facebook to see if we can reach out to that individual who started that. You want to be amicable with the person that started that page because they have an audience of 25,000 Zippo fans and could speak poorly of Zippo if you make the wrong step. However, Zippo is our brand and our trademark, and we want to be careful with how people use it.
Ad Age: Zippo has a huge profile on YouTube. Have you thought about how it can leverage video on the web?
Mr. Paup: Some guy started zippotricks.com; we engaged with that person, who was from Norway, in 2003. He created a platform where you could upload and vote on videos. But in the end we became concerned that the age group was getting to the point where we didn't want to be promoting playing with fire. We backed off and turned it back over to him and it became lightertricks.com. We didn't want to put our thumbprint on it.
Ad Age: Is there any evidence that your social-media presence has affected sales?
Mr. Paup: It is challenging to measure the return because in most cases we are selling through wholesalers and retailers and a lot of those retailers we don't know. It's hard to measure sales as a result of the coolness of the iPhone app. We do see some nice increases this year in our online sales, which are up more than 20%.