Since its inception, e-cigarette stores have flourished in the United States, the United Kingdom, Japan, and Southeast Asia.
Although e-commerce in these areas is growing, consumers are more accustomed to buying e-cigarettes from physical stores. Because e-cigarette is a highly experience-dependent product, physical store, can offer such convenience for customers to select.
However, the Chinese e-cigarette market is just the opposite.
Dying physical stores, impact of e-commerce
Although China is the world’s largest e-cigarette production base, 90% of the world’s e-cigarettes come from China. However, due to local shopping habits, most people heavily rely on e-commerce, which leads them to go to online stores to buy e-cigarettes more often rather than physical ones.
Perhaps for e-cigarette manufacturers and brands, regardless of the channel through which sales, the overall sales are still growing, so physical stores are less important. But in fact, the physical store will not only affect the promotion of e-cigarettes but even have a great influence on the consumer experience and people’s acceptance towards e-cigarettes.
Since late 2014, Susan and her friends had run 3 e-cigarette physical stores in Wuhan, China. During its peak, they work from the opening until closing time every day. However, because e-commerce has lower operating costs and complete platform promotion methods, and consumers are increasingly enjoying the convenience brought by e-commerce, She and her friends decided to close 2 physical stores and put their efforts on the last one and e-commerce platform.
Although turning to the e-commerce platform can alleviate a lot of pressure of constantly rising rent and labor cost, but Susan also expresses her regret of closing down the physical stores.
She says: “I found that when I first operated a physical store, the customers were loyal. Many old customers came to the store at least twice a month. Some of the customers became friends after a long time.”
“A lot of customers will tell us about their needs. We will also introduce the products accordingly. In the leisure time, customers and we will talk about work, private life, love affairs, etc. and we are emotionally attached to each other.”
However, when operating e-commerce, Susan and her friends found that consumers who came to e-commerce shopping have almost no loyalty. In addition to the very low product repurchase rate, they often being used as a price comparing tool. “A lot of customers are one-off buyers. As long as he buys it once and knows how to use it, the next time he will find a cheaper seller.”
“And even if the e-commerce platform comes with the function of chatting with the seller, but many consumers do not understand the product properly, for example, condensate problem, oil leakage, or charging problems, they will take these as a quality problem and ask for replacement or refund. Without face-to-face communication, it is difficult for us to understand consumer habits and needs.”
In fact, Susan is not the only e-cigarette seller that encounters such a situation. As long as there are e-cigarette sellers who operate e-commerce, the same problems abound.
The very nature of e-cigarette
The e-cigarette is experience-dependent. Whether the early big vape mods or the new interchangeable small portable vaping devices, it is a “new” thing for many smokers.
Despite the convenience and ease of use of the small portable vaping devices, the threshold for turning traditional smokers into e-cigarette users is much lower, and they can easily learn to vape. But as the situation faced by Susan, many smokers do not understand e-cigarettes, and are not familiar with some minor problems and how e-cigarette works to replace traditional cigarettes. Therefore, smokers who lack relevant knowledge are easy to give up vaping after they tasted e-cigarette for the first time.
On the other hand, a study from UK also shows that e-cigarette stores play an integral part in supporting traditional smokers to switch to safer and harm-reducing alternatives.
The title of this study is “I Felt Welcomed in Like They’re a Little Family in There, I Felt Like I Was Joining a Team or Something”. The study aims to understand the customer’s experience with “using e-cigarettes” and “shopping in physical stores” and the extent to which “harm reduction information” is obtained in these physical stores.
The researchers conducted a telephone interview with 22 physical store customers in the East Midlands area of the UK to discuss the participant’s history of cigarettes, the reasons for using e-cigarettes, how e-cigarette stores help users, and whether they had discussed smoke cessation in stores.
The aggregated data indicates that respondents believe that e-cigarettes are a smoking cessation tool and report a very positive experience. Participants found that e-cigarette stores were critical to their experience, “because they offer a variety of high-quality products, as well as reliable product information and advice.”
Customers generate loyalty in their consumption and work with other e-cigarette users to create a community that helps support e-cigarettes. Although e-cigarette stores are not considered by the general public to provide an environment for smoking cessation advice, they are considered to be potential sites for cessation support.
The study also concluded that physical stores play an important role in reducing tobacco hazards. If their service model can help traditional smokers to quit, the value of their harm to society will increase.
In general, e-cigarette stores are actually a very important part of the development of the e-cigarette industry, especially for consumers who are new to the e-cigarette. The advantage of a physical store is that it not only provides valuable harm reduction information for users but also solves problems for customers by understanding the needs.
However, in the Chinese e-cigarette market, physical stores are somehow a weak point
According to Baidu, the current number of e-cigarette stores in China is about 1,500, of which 212 are in Shandong Province and 179 in Jiangsu Province. Compared with more than 1,000 e-cigarette stores in Seoul, South Korea, the number of Chinese smokers is bigger, and such a quantity is far from enough.
Increasing needs for physical stores
Although in the context of Chinese consumers heavily relying on e-commerce shopping, plus the poor professional knowledge of the store owners and employees, it is very difficult to run e-cigarette stores. However, as more and more large enterprises enter the e-cigarette industry and information becomes more common and transparent, perhaps enterprises should actively support the development of physical stores and solve the problem of slow market growth.
Promoting e-cigarettes, in addition to increasing user adhesion, allowing more people to know what is e-cigarette, can also effectively solve consumer problems and enhance the awareness of harm reduction in local consumers. The consumer experience of a physical store is like a gear, driving the development of the electronic cigarette industry, and is a necessary link for the promotion of electronic cigarettes to consumers.
On the other hand, Chinese e-cigarette stores have experienced many ups and downs in recent years, and now they have new opportunities to flourish again: The rapid development of e-cigarette industry will need more physical offline distribution channels. Perhaps this year physical stores will be revitalized.
After all, physical stores are like an indicator of the e-cigarette market. If the number of e-cigarette stores continues to increase and profits increase, it will truly represent the expansion of the e-cigarette terminal market and the continued growth of users.