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TOBACCO BUSINESS INTERNATIONAL
MARCH/APRIL 2015
trench marketing
His Cut Rate Tobacco stores are
more or less operating on autopilot
in the sense that his customer base
is well-established, and the stores
have performed well year-to-year by
traditionally keeping prices low on the
products he carries (a diversified list
of big name and off-brand cigarettes
plus dip, chew, some premium cigars,
and accessories like candles, incense,
lighters and snacks) to encourage
high volume. Kathman doesn’t do any
advertising whatsoever for those stores
because the same customers keep
coming back to them.
Like Cut Rate Tobacco, Kathman
wants the Cincy Vapors stores to carry
something for everyone—from the
vapor novice to experienced vapers. He
carries a wide array of e-cigs, eGo style
batteries, unregulated (mechanical)
mods, and juices in each store. “I try
to appeal to everyone—from the guy
who asks, ‘What the hell is this?’ to the
guy who actually educates
me
,” he
says. “But I do not make my own juice.
Obviously I’m envious of those stores
that make their own juice because the
margins are [incredible],” he states, “but
that’s not my expertise, so I only resell
other manufacturers’ juices. I’m in retail,
not manufacturing or chemical facilities.
Also, I think when regulations hit—and
they most definitely
will
hit—that’s
what’s going to get hit first.”
Social Media Edge
What has helped make the Cincy
Vapors and Cincy Vapors Express stores
so successful is active management
of the chain’s brand core values on its
website, as well as through its presence
on Facebook, Twitter and Instagram.
Kathman is also an active participant in
vaping forums and regularly responds to
customer email inquiries himself. “I still
don’t understand all of the technology,”
he says, admitting that he had to ask his
20-something daughters to explain it all
to him one day while sitting around the
kitchen table. “Facebook friends and all
that… it’s not for my generation, but what
I do know is [that] it’s very important to
the generation that is supporting vaping;
it’s a major part of their lifestyle.
“I believe social media has been a big
part of our success,” he says. “It has made
us grow, has made us rethink a lot of
strategies, [and has] given us better ideas
about what products to have. It makes
our stores and the experience we offer
personal, and that’s good for customers.”
But above all, he says, the most important
thing he and his employees do happens in
the store. “I emphasize concentrating on
listening to customers,” he explains. “You
can gather a lot of information by listening
tocustomers talk toeachother. I eavesdrop,
then weasel into their conversation and ask
them what they like about this [particular
product]. Then I go home and research
what I hear them talk about.”
And staying ahead of the curve with
vaping is what Kathman believes will
keep his head above water as tobacco
consumption continues to decline. “In
Ohio they’re planning to add more taxes
to cigarettes, and the federal government
is too, so we have the potential to see a
$20 increase per carton,” he says. “That
means there’s no potential for cigarette
sales, but lots of people will be driven to
vaping.” And when they do, Kathman will
be there, ready and waiting.
TBI
“I believe social media has been a big
part of our success. It has made us grow,
has made us rethink a lot of strategies,
[and has] given us better ideas about
what products to have.”