My club went partially non-smoking 10 years ago and fully non-smoking as soon as we realised that even one smoker in the room even under the extractor fan stunk the whole club out.
We have gained audience and singers steadily ever since. Smokers can stand in the bar or lobby and puff away to their hearts content and don't need to miss much of the show to do so.
We have had some people who couldn't stand the loss of nicotine and stopped coming but very few.
I used to go out for a ciggy but got fed up missing bits of every club night, one of the reasons I gave up.
Go non-smoking if it won't cut the audience too drastically. Alternatively, set up a smokers area next to an open window or fan for a few months and then declare it non-smoking once people are partly resigned to the inevitability of it happening.
Good luck