Optimizing chain store
June 2020
Zealand Academy
Intern at Ecigz and AP Student
Solutional suggestions for vape store
During my AP programme, I interned at Ecigz, a chain of shops selling vaping products and accessories. I had some experience in this niche field beforehand. I find vaping products interesting since they require extensive product knowledge, searching for errors, and knowing a bit of Ohm's law. The same goes for the community of eccentric misfits, meaning that the work culture is informal and consists of a flat organisation. It was an eight-month internship, during which I chose to write my final report for my AP degree in Commerce Management. ​​​​
Case
I analysed the external aspect and received customers‘ opinions on Ecigz and other potential target groups’ views on what a good vape shop should possess. When a company employs you, it is fairly easy to observe areas of focus or optimisation internally. Still, it isn't easy to see from the customers' perspective what can be corrected if this is needed. Many Ecigz stores opened the last two years beforehand. Denmark's largest vape shop chain (in terms of number of stores consisting of 28 at that time), Smoke-It (now named Gejser), expanded its number again by opening one more store in the Fields shopping centre. This means that Ecigz stores competed both internally within its own chain and externally. I wanted to investigate what attracts customers to a specific vape store and why they choose one store over another.
The questionnaire aimed at Ecigz customers
The physical quantitative questionnaire was divided into two columns so all 18 questions could fit on one printed A4 page. This made it more manageable for the customers, as they didn't have to fill in several pages, and the same goes for me when I had to do the data sorting afterwards. It was not qualitative because the customer may be too busy to have a long and personal conversation, and I would have to remember to audio record simultaneously. Imagine this while another customer is waiting for service. In addition, verbal conversations are often associated with standing closer to each other, and neither a customer nor a salesperson would be comfortable with this at that time due to the Coronavirus. Therefore, I printed out the questionnaire and placed it on the counter for the customer to fill out while I packed the products. I chose to use a font called Calibri as it's familiar to people who write in Word, and the font size is 12 to increase readability. Most of the questions were closed-ended because I wanted concrete data from the answers and because they were quick to answer, while few were more open for the customer to express their opinion. I have included examples of answers below to minimise doubts about my wording.
Online questionnaire aimed at vapers on Facebook
The second questionnaire, consisting of only 7 questions, was created via Google Analyze and publicised and available on Facebook. This questionnaire was aimed at vapers who, of course, have a Facebook profile. Most of the questions asked were similar to those for Ecigz customers to see if vapers who shop elsewhere or live too far away from any of Ecigz's 19 stores have any correlation with customers.
Who is Ecigz's target audience?
Primary
The primary target group consists of respondents from the questionnaire who shop in Herlev and Albertslund. The primary target group also consists of most respondents, 39 out of 51. In addition to the questionnaire as data, I have utilised the website conzoom.dk, which shows statistics on lifestyle, education level and much more, to find out further who this target group is.
Demographic
Geographic
Socioeconomic
Psychographic
Behavioural
Primarily men
Early twenties
Single
Vestegnen
Greater CPH
Trade school
Blue collar jobs
Violet
Family oriented
Shop locally
Thrifty motive
Secondary
18 respondents are in their early 30s and are still primarily male. Here I focused on the responses from customers who shop in the store on Sølvgade in the centre of Copenhagen and Helsingør in North Zealand. Although the two cities are far from each other geographically, they have similarities in socioeconomic, psychographic and behavioural segmentation criteria.
Demographic
Geographic
Socioeconomic
Psychographic
Behavioural
Primarily men
Thirties
Childless
Central CPH
Northern Zealand
University degree
White collar jobs
Green
Cultured
Shop ecological
Snob motive
Facebook survey
337 respondents answered my 7 questions.
​
247 consisted of men.
67 of them were between 18-25.
47 of them lived in Greater Copenhagen.
56 of them have been vaping for 4 years.
75 shopped at Smoke-it.
85 chose the store based on customer service.
141 picked "expertise" when asked what they
value the most (see the pie chart on the right).
Red: price, green: variant and yellow: brand.
Proposed solutions
The reasoning behind my suggestions for the chain store is based on the results of questions addressed to their local and regular customers, as well as my theoretical knowledge.
​1. Standardisation of store layout
Some stores could reconsider using wooden crates on the floor as they are only about 60 centimetres tall. When items are placed so low to the eye, the customer doesn't pay as much attention to the products. The items in the glass cases, typically consisting of entire vape kits comprised of battery, tank and additional accessories such as coils, replacement glass and USB charger, should be filled out on the shelves with some spacing. Some of the stores I worked at either had too few kits on the shelves, which can give a wrong first impression to the customer who thinks that we don't have many items to offer or the opposite, with too many kits standing next to each other which becomes stressful and confusing to the eye. Each store has about four glass cases that can be utilised concerning product categories. I recommend one of them consists of simple and small kits for beginners, another with larger kits for those who are familiar with vaping equipment, and a third with products called rebuildable deck atomisers or ‘drippers’ for the very few customers who want to build their own coil and the fourth for accessories such as external chargers. Some of my colleagues tend to place different products in the same glass case next to each other, which doesn't appeal to the same types of customers. Eight Ecigz stores where I had shifts lacked price tags on the merchandise, whether larger and more expensive items or cheap items at the counter. Customers do not like to ask the price, so adding tags would be ideal.
2. Expansion or change of products
By using the inventory system, managers and store clerks can look at which products they have sold a lot in a couple of months and, based on this, consider what to order for next month. To get an overview of which products are trending right now and which are being phased out, my colleagues can divide the products into four phases: introduction, growth, maturity and decline. This makes it easier to assess which products they should try to sell out of the fastest possible and which ones they should invest more in, and this also applies to the placement of the products in the store inventory. The model can assess which products should have an A, B, and C placement, where A is the most visible, and C is, for example, on the lowest shelf. As an example, I have made an overview of which products can be placed in the PLC model combined with the A, B and C spaces to inspire the employees.
Introduction
Growth
Maturity
Decline
C
B
A
A
3. Improved delivery of online orders
Customers could not tell whether a product was in stock, as this was not made visible on the website. The only store that handled packing and shipping online orders lacked a modern and digital POS and inventory system compared to the other stores. The warehouse consisted of a basement with several rooms where some items were placed on shelves without labelling or in boxes to make it easier to find and sort through them. To make it even more organised, investing in a few more cheap bookcases from a thrift store and storage boxes from Jysk can do a lot. It's still financially cheaper than proposing an actual warehouse, which could increase delivery service in logistical efficiency but expensive in storage costs. Ecigz did not need to invest in warehouses but was required to make administrative changes to keep track of the number of products. They had some older vaping products that were not necessarily bad because they were popular a few years back. Still, they are not placed on the shelves in the store itself because there needs to be room for the newer and more popular products. This is where their website could be the perfect sales channel, and there is a bigger target group to capture with online websites.
Quote
"Since the internship was connected to her AP degree, she would analyze the company, make surveys, and write assignments about the company with recommendations
within improvements."
​
- Alex V. - Executive Sales Director at Ecigz ApS