Next time you go to your smoke shop, pretend you’re walking in for the first time. What catches your eye?
Is it clear where to go next, or is everything cluttered and hard to navigate?
Tobacco merchandising might make you think of inventory management, but it’s far more than that. It’s about strategically displaying products in ways that shape how customers feel, where they go, and what they ultimately decide to buy.
By the end of this article, you’ll have all the tools you need to optimize your shop’s floor plan, motivate sales, and maximize profitability.
Visual merchandising is the strategy of arranging your smoke shop’s layout, product displays, and storefront to attract foot traffic, engage customers, and drive sales. It includes:
Equal parts art and science, the right approach to tobacco merchandising depends on the nature of your shop. Customer demographics, retail space, and product types all impact your effectiveness.
Our goal is to help you understand the principles of visual merchandising, so you can make the right decisions for your store.
Last year, poor visual merchandising cost U.S. retailers over $125 billion in sales. For tobacco shop, cigar lounge, and vape store owners, the stakes are even higher.
Unlike many other retailers, smoke shop owners have fewer tools to compensate for weak visual merchandising, making every display decision count even more. Advertising restrictions mean you have to make every shot count. You can’t afford to lose customers to poor in-store presentation or miss out on foot traffic due to ineffective exterior signage.
According to one study, property display allocation alone can increase a location’s revenue by more than 11%. That’s without doing anything other than rearranging the inventory you already have on hand!
As creative as you may be tempted to get with visual merchandising, there are some limitations depending on what you sell and where you’re located.
For instance, federal law dictates that:
Some of these regulations don’t apply to cigars, hookahs, or e-cigarettes, but state and local laws can be even more restrictive — so know your jurisdiction. Profits from better tobacco merchandising pale in comparison to the cost of possibly losing your tobacco license.
Remember: We’re your trusted point of sale (POS) experts, but not your lawyer. Always consult an independent, qualified professional for legal advice.
Ready to use layout and visual cues to increase revenue? Follow these eight steps for a better shop experience and more effective tobacco merchandising.
Your customer base is the driving force behind your tobacco merchandising strategy. When planning, take the time to fully understand what your customers look for.
Is it quick purchases? Expert advice? A relaxing atmosphere where they want to spend time?
Generally, these answers vary by smoke shop:
Each of these segments requires a different approach to visual merchandising.
Pro tip: In addition to firsthand experience, you can use analytics from your smoke shop’s POS system to uncover purchasing patterns and customer data to guide your efforts.
Did you know that 76% of customers have entered a store just because they liked its exterior? Tobacco merchandising isn’t limited to your store’s interior. It also includes your storefront, window advertising, and signage.
Upgrading your storefront and exterior signage improves foot traffic by 10–15% and overall sales by 7–15%.
Exterior signage should be clear, memorable, and visible from the street. Legibility is extremely important — customers shouldn’t have to guess at what you offer. At the same time, you want to keep word count low and focus on providing your most compelling value proposition or CTA.
Storefront ambiance should be attractive, inviting, and aligned with your customer base. Vape shoppers might be more attracted to bold, branded window ads and digital displays, whereas cigar lounge clientele might prefer a more understated approach.
The dimensions of your retail space also dictate what works best from a tobacco merchandising standpoint. Think through the experience you provide customers once they enter your store:
A “straight layout” might work better for small, narrow spaces, where customers move linearly through your shop. This type of layout is popular for vape shops, since it allows your associates to offer more hands-on guidance and protects against inventory loss from shoplifting.
A cigar shop or lounge might be better served by a “racetrack” or “loop layout,” where customers can take a circular path to browse the selection of your store or walk-in humidor.
Ambiance should be equally customer-centric. For a vape shop, bright colors and product backlighting provide a more tech-forward feel and encourage quick purchases and impulse buys. A cigar lounge, on the other hand, might opt for dim lights and comfortable furniture to keep customers lounging longer (and buying more!).
Your floor plan guides customer movement, but it’s not the only element of visual merchandising that determines how easy it is to navigate your shop.
Product categorization and interior signage play a major role in helping customers find the products they need.
Group products based on how customers shop. For a vape shop, it might make sense to group inventory by brand, product type, or use case. Grouping by brand helps loyalists find all the products they need in one go. Plus, it lets you maximize the effectiveness of manufacturer-provided marketing collateral.
Or, take a cue from e-commerce by replicating “frequently bought together” logic in your displays. Start by identifying your bestsellers, then group them with the accessories or complementary items customers often buy together. For example, pair a bestselling vape mod with compatible coils and juices, or group a top cigar with a torch and cutter. This not only simplifies shopping, but nudges customers to add one more item to their cart.
No matter how you categorize your items, use interior signage to help customers find the types of products they're looking for. That way, your staff can spend more time sharing expertise and less time playing customer wayfinder.
Product placement is a powerful opportunity to target specific sales goals and maximize profitability.
When customers enter your store, 90% of them turn right. This area is known as your “power wall.” Generally, this high-converting space should be reserved for in-demand bestsellers and high-margin items — but you can also use it strategically to build awareness for new products or offload lower-performing inventory.
Additionally, 52% of sales are made at eye level. As you arrange your shelves, displays, or humidor, use this visual merchandising principle to influence what customers buy.
The area around your cash register — often called a point of sale display — is where you should place impulse buys. Over 70% of purchasing decisions are made at the point of sale, so use this area wisely. Depending on your shop, items like soft drinks, torches, cigar cutters, nic salts, or low-cost disposables might be the perfect impulse offerings.
Want to take impulse purchases one step further? Try placing small accessories — like lighters, cigar cutters, or vape tools — in shallow bowls or trays near your checkout area. This encourages customers to sift and explore, creating a mini “treasure hunt” moment. Psychologically, the more time a customer spends handling or interacting with a product, the more likely they are to buy it.
Effective bundling and add-ons maximize the value of each checkout.
Think through what your customers likely need, then provide it in a convenient, cost-saving package. Vape starter kits or cigar bundles anticipate customer needs while providing opportunities to increase revenue.
The key is to make promotions and product bundles easy to implement, track, and apply at checkout.
Another easy win? Set up a dedicated “new arrivals” area. This keeps regular customers engaged by giving them something fresh to browse every visit. Use signage to highlight what’s new, why it’s exciting, or why your shop is the only local supplier.
Bonus: With the right POS system for tobacco shops, you can monitor new item sales and make informed decisions about whether they become permanent staples.
Tobacco merchandising and inventory management go hand in hand. Out-of-stock displays cost U.S. retailers $82 billion in lost revenue. But sitting on too much unsold inventory is expensive, too.
Don’t let out-of-stocks frustrate customers or allow unsold backstock to collect dust. Keep displays stocked with the right products in the right amounts.
Your POS system can help you accurately track and anticipate your smoke shop inventory, allowing you to consistently grow profits and reduce costs.
If you don’t have the budget for new inventory, rearranging your existing stock can go a long way. Even simply moving accessories or feature items to different shelves every few weeks gives customers the sense that your store is evolving. It’s a great tactic for maintaining perceived freshness and encouraging repeat visitors to try a “new item” alongside their usual purchase.
Remember: Visual merchandising is equal parts art and science. Build your hypotheses around what you think your customers respond to — then, test it against real-world sales data.
You can optimize the effectiveness of your tobacco merchandising by tracking metrics like product sales, average transaction value (ATV), sales per square foot, and customer loyalty metrics through your smoke shop POS.
Then, you can use this data to identify what areas of your store are most profitable, which products to feature in high-value areas, and which visual merchandising strategies are most effective overall.
Outside of actually moving furniture, Cigars POS gives you everything you need for more effective tobacco merchandising — in store and online.
With customer analytics, connected inventory, built-in verification, and high-risk processing, Cigars POS helps you provide smooth checkout experiences that keep customers coming back.
Ready to put your layout to work? Schedule a free demo of Cigars POS to see how having the right tools can help you make smarter, more profitable merchandising decisions.