With legalization sweeping across the country, the cannabis category is evolving just like any other successful mainstream market—with scale and diversity. Consumer insights company MRI-Simmons reported 22 percent of the total population now consumes cannabis or CBD, a 38-percent increase from 2018 to 2019. The report also showed more than 56 percent of U.S. adults support legalization.
As more markets begin to roll out legal cannabis programs and attitudes continue to shift among the U.S. population, there will be an explosion of new cannabis consumers across the country. Two consumer groups stand out, particularly during the COVID-19 pandemic: new-to-cannabis consumers and new-to-legal-cannabis consumers. While both enjoy cannabis, their path to purchase is different and likely requires tailored marketing strategies.
New-to-cannabis consumers
The first group, new-to-cannabis consumers, is composed of people just starting out on their journey into the cannabis and CBD market. This group generally has little experience in the space and tends to lack sufficient knowledge in the field to make informed purchase decisions. They want to experience all or specific benefits of cannabis products but might not be sure where or how to get started.
New to the category but excited about its potential, these canna-curious customers will be far less familiar with product offerings, dosage guidelines, and the dispensary shopping experience in general so will look to brands as the trusted source of guidance at the beginning of their cannabis journey.
Marketing Tip: Help new cannabis consumers confidently take their first step into the market by providing them with content that makes shopping feel simple, safe, and fun:
- Plan a virtual activation or live stream event that invites consumers to learn first-hand about ease of access, convenience, and product offerings led by experts in the space.
- Devote a section on your site to cannabis education that provides specific purchasing advice relevant to your product portfolio.
- Run remarketing campaigns targeting website visitors who previously engaged with your educational content but didn’t check out. These ads should reiterate messaging around shopping best practices, safety, and ease of access.
New-to-legal-cannabis consumers
While net new cannabis consumers represent a massive market (and marketing) opportunity, there’s an even bigger group emerging: established consumers who are new to the world of legal cannabis but not new to cannabis consumption.
These new-to-legal-cannabis consumers are experienced cannabis consumers who are transitioning from black market to brick-and-mortar buying. Thanks to the coronavirus pandemic, the shift to legal retail is accelerating as consumers choose personal safety over lower prices associated with unregulated environments.
A study conducted by the University of Waterloo School of Public Health in July 2020 found that across Alaska, California, Colorado, Nevada, Oregon, and Washington state, 40.3 percent of respondents perceived legal cannabis to be safer to use, 59.2 percent perceived legal cannabis to be more convenient to buy, and 56.1 percent perceived legal cannabis to be safer to purchase.
These new-to-legal consumers are driving growth in markets across the country. In Michigan, for example, recreational cannabis sales surpassed medical sales for the first time in the week of June 15 and had grown nearly 800 percent overall since December 2019.
Unlike cannabis consumers new to the category, new-to-legal consumers have established product understanding, preferences, and routines. Their purchasing behaviors indicate they prioritize convenience and efficiency above all. Fyllo campaign data for May and June shows the majority of checkout activity happened in the early morning and afternoon. What’s more, consumers have been shifting their purchasing behavior to earlier in the week. In May, nearly 53 percent of total sales volume took place Friday through Sunday. In June, only 45 percent of purchases were made on the weekend, with buying on Monday and Tuesday increasing by 74 percent and 36 percent, respectively.
This shift to shopping earlier in the week tells us two things about new-to-legal-cannabis consumers:
- They shop at times and on days when dispensaries are less crowded and wait times are shorter.
- They purchase cannabis like any other essential product bought on a routine basis.
Marketing Tip: Resonate with new-to-legal-cannabis consumers by tailoring your messaging to highlight ease and efficiency.
- Choose a specific call to action for your ad creative (e.g. “curbside pickup,” “delivery,” “pre-order”).
- Implement time-focused ad copy that speaks to the efficiency demands of these consumers (e.g. “delivered in minutes” or “same-day pickup”).
- Offer promotional incentives and/or subscription services for consumers who buy from you each week.
As the number of legal cannabis markets in the U.S. grows, the number of new consumers will grow exponentially. While new-to-cannabis and new-to-legal-cannabis consumers have unique needs marketers must acknowledge, both groups represent massive opportunities for cannabis companies looking to grow their customer base.
Fyllo Chief Marketing Officer Conrad Lisco built his career by combining a talent for disruptive brand positioning with galvanizing team leadership. He previously served as senior vice president of marketing at Amobee, a global advertising technology platform, with accountability for all corporate and product marketing as well as sales enablement. His ability to create scalable messaging and campaigns, along with catalyzing his teams for market-leading customer engagement, successfully drove sales growth at Amobee, making it a leader in its industry.
Lisco has held many roles that merge strategic leadership with digital expertise including partner and chief growth officer at Co Collective, strategy director at R/GA, and strategy director at 5th Finger, one of the first mobile marketing agencies in the U.S. By successfully navigating highly competitive and sometimes commoditized categories, Lisco has logged an impressive record of wins for global brands including Google, Nike, LVMH, Walmart, and Coca-Cola.
