STMA’s “Internet Plus” Terminal Marketing Efforts
By TobaccoChina Online
There are more than five million tobacco retail terminals in China, divided into grocery stores, convenience stores, and tobacco and alcohol stores. In terms of sales, the revenue and gross profit of individual stores in conventional business form still account for a large proportion.
In this internet era featuring big data, cloud computing, and AI, the construction of modern cigarette retail terminals has long involved more than image transformation and store upgrading in the traditional sense like signage, floor cabinets, light boxes, advertisements, and strip lights. Rather, applying new technology architecture and big data to better control and improve the serviceability of cigarette retail terminals, how to improve the control over and serviceability of cigarette retail terminals has been a main focus for the Chinese tobacco industry.
In recent years, some units in the industry have explored channel brand construction, gradually accelerating the transformation of retail terminals from traditional stores to digital stores and branded stores. The Dalian, Zhejiang, and Guangdong branches of the State Tobacco Monopoly Administration (STMA) are such examples, having made positive attempts to create channel brands at the provincial level.
Dalian branch’s Spring convenience store
Since 2016, STMA’s Dalian branch has been actively exploring new cigarette retail development directions, aiming to reform its cigarette marketing. The Dalian branch has created a new chain of cigarette retail terminals with a beautiful image as well as modern and standardized operations. At a 2017 construction site conference, Dalian showed that more than 200 cigarette retail stores became Spring convenience store franchise terminals; over 2,300 retail customers installed New Business Link, a retail terminal management platform integrating online and offline; more than 120,500 consumers became members of Spring service, a consumer marketing platform; and nearly 87,100 people followed the platform, accumulating 13.37 million points.
Starting in 2019, the Dalian branch has adopted terminal construction as a systematic, strategic, and long-term program for the development of the enterprise, making all efforts to promote terminal construction and upgrading.
High-standard construction of franchise terminals: Publicity, retailer selection, transformation, incubation, and other links are connected to form a system and normalize the operation; publicity is carried out through all channels both online and offline to tell the Spring convenience stores story; standardized transformation of franchise terminals are benchmarked against famous international convenience store chains such as Lawson and 7-Eleven.
Specialized operation of franchise terminals. A series of effective methods were implemented including Spring convenient direct sales benchmarking stores being built; a legal risk prevention and control system was established and improved; a strict terminal operation and assessment mechanism was developed; supervision and inspection of the franchise terminal and special management were achieved.
Full-service franchise terminals. The Dalian branch focuses on strengthening terminal training, promoting the transformation of retail customers and tobacco from “data docking” to “idea docking”; integrating enterprise resources, developing in-depth cooperation with COFCO group, as well as carrying-out crossover marketing activities of cigarettes and red wine. A series of innovation measures enrich the service content and means, bridging communication and the last mile of consumer-oriented marketing.
It is expected that by the end of 2020, they will build 500 Spring convenience franchise terminals, truly forming the brand scale effect of chain convenience stores in the Dalian area.
Guangdong branch’s 20 cigarettes
On June 21, 2019, STMA’s Guangdong branch held a construction site conference, debuting 20 Cigarettes, its new retail brand direct sales stores. If you ask about the difference between Guangdong branch’s 20 Cigarettes stores and traditional cigarette retail stores, the “black tech” behind it must be mentioned.
Different from the traditional store where goods are separated from customers by counters, new styles of cigarettes and hot-selling cigarettes are placed in a glass cabinet in the center of the 20 Cigarettes stores. Customers can choose freely as long as they keep turning around. The open space enables customers to achieve close contact with the commodities.
Beside each style of cigarette, an electronic price tag replaces paper price tag. By scanning the QR code, customers can check detailed information of the cigarettes and place an order through their mobile phone, then they can go to the cashier to pick up the goods or enjoy the home delivery service.
In addition to the change of purchase mode, 20 Cigarettes also provides customers with a better consumption experience.
First, it’s buying through the 20 flash sales app. Customers choose to make an appointment and then pick-up at the nearest store or pay upon delivery.
Second is buying through the vending machine in the store. The payment is easily completed. The customer only needs to put the barcode of the product at the scanning port of the machine, scan the face for authentication, and then input the mobile phone number bound with WeChat.
Third is buying through Cloud Shelf, where all the products in the store are put, and customers can place orders independently by scanning the QR code with their mobile phones. Its application enables 20 Cigarettes offline stores to minimize inventory. Given the consumption habits of older customers, 20 Cigarettes still retains the traditional cash register mode. The huge database of 20 Cigarettes is behind these convenient and cool black tech. By analyzing the behaviors of each customer when they are connected with the brands and commodities, the tobacco company builds a complete big data system, which enables the stores to realize online and offline integrated operation, and further promotes the efficient operation of the entire consumption chain.
Zhejiang branch’s Sunny Retail
STMA’s Zhejiang branch has made great efforts to build the terminal brand of Sunny Retail through upgrading and transforming many well-perceived and well-operated retail stores. They unify brand identity and carefully create beautiful, trusted, professional, and intelligent terminal brand images, while many retail customers recommend consumers to be members of Sunny Retail. This will not only bring benefits and convenience to members but also help retail customers to understand consumers’ consumption habits. The Zhejiang branch has realized one-stop ordering, digital operation, and mobile service for retail customers, benefiting more than 300,000 retail customers in Zhejiang province.
In addition, the channel brands have launched non-tobacco new retail exploration with an online layout, a move that has achieved initial results, but still has a certain gap from the benchmark outside the industry.
Affected by the Covid-19 epidemic, people’s consumption habits are changing and community businesses closer to consumers embrace this as a good opportunity to develop. These modern cigarette retail terminals with local cigarette channel brand logos have become the “online celebrity shop” in the community with their intimate service and advanced business mode.
During the epidemic prevention and control period, the tobacco marketing channel brand terminals featuring 20 Cigarettes, Sunny Retail, and Spring convenience stores maintain a high business rate by integrating online and offline resources and fully guaranteeing market supply.