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TOBACCO BUSINESS INTERNATIONAL
MARCH/APRIL 2015
new customers, so we incorporated
vaping into our tobacco stores,” Kathman
explains.
All four of his Cut Rate Tobacco stores
now sell wicks, starter kits and juice
brands using the store-within-a-store
concept he learned from his mentor.
“We call it Cincy Vapors Express,” he
says. “In our Cincy Vapors stores, we tell
customers we’ve got other stores around
town, and our business card has ‘Cincy
Vapors’ on the front and ‘Cincy Vapors
Express’ on the back. Some customers
don’t know [the Express stores are]
actually inside tobacco stores; they
never put two and two together.”
However, many customers do make
the connection, and some are offended
by the idea of going into a tobacco store
to buy vaping products, says Kathman.
“We have customers who will only come
into our Cincy Vapors stores because
they’ve kicked the habit and don’t want to
be reintroduced to tobacco,” he explains.
“Stopping smoking and moving to
vaping might have been a hard transition
for them,” he adds, “and they don’t want
to be tempted. I get it, and I try to smooth
it out with those customers. But vaping
is the future…that’s why I’m doing
this. I’ve seen people—my Cut Rate
Tobacco customers—use pills, patches,
gum, fake cigarettes and step-down
cigarettes, and every one of them comes
back to tobacco,” he says. “Vaping and
e-cigs give people the hand-to-mouth
experience that resembles cigarette
smoking, and it works for people who
have cessation goals in mind.
“Vaping is like the cell-phone
business of tobacco because you can
sell accessories,” he reveals. “In my
tobacco stores I sell plenty [of] packs
of Marlboros, but the customer doesn’t
want much more except maybe a lighter
every three weeks, or a cigar when they
have a baby—there aren’t add-on sales
there. In our Cincy Vapors stores, you get
upgrading, you get extra sales and there
are just more potential reasons to sell
products to customers. The bottom line
is profit margins. With cigarettes that’s
8 to 10 percent, but with vaping the sky
is the limit.”
Some customers understand, he says,
but others think it’s wrong, so Kathman
religiously works behind the counter
in his Cincy Vapors stores everyday
to check the pulse of what’s going on.
“I know what’s happening with new
products, I hear what the complaints and
gripes are, but this conflict, as people see
it, is huge, and when I say
huge
, that’s an
understatement.” Kathman unabashedly
acknowledges that he wants to capitalize
on the sales opportunity that vaping
represents to him as a retailer, but he also
wants to do the right thing for customers
who are confused by his dual interests.
“The business side of me says, ‘Grab
anything you can.’ So that means with
some people I have to appeal to their
heart with another part of the truth,” he
says. “Having the Cincy Vapors Express
stores inside Cut Rate Tobacco stores is a
way for me to sell more product, and that
means my people keep having jobs,” he
opines.
trench marketing
“I know what’s
happening with
new products,
I hear what the
complaints and
gripes are, but
this conflict, as
people see it, is
huge, and when I
say
huge
, that’s an
understatement.”