How to Win Cannabis Customers and Influence People

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Consumers have many choices in today’s environment, and they’re always on the hunt for better deals, better service, better aesthetics, better products, and better perks. Retailers must be creative and resourceful to earn their loyalty. That does not mean they must reinvent the wheel. A growing number of technologies and techniques can be adopted by almost any dispensary or shop to address almost any circumstance. 

Beyond demographics

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Consumer behavior is much more complex than demographic data like age, gender, and socioeconomic status indicate. Increasingly, retail experts are building profiles of a business’s ideal customer by turning to psychographic modeling. By studying attitudes, aspirations, and other psychological characteristics of existing or potential customers, retailers can gain more relevant insight into the products and services to which they’re likely to respond.

According to Socrates Rosenfeld, founder and chief executive officer at Jane Technologies, psychographics allow retailers to understand not only who their customers are but also why those customers buy what they buy. “Once retailers understand who they are serving, they are able to build a customer experience that can anticipate and meet their customers’ needs beyond their age and gender,” he said.

High-tech marketing platform Surfside based its entire business model on identifying consumer behaviors. The company’s proprietary algorithms analyze data from the material world, digital events, online advertising and media, apps, and point-of-sale systems to “identify additional consumers who share the same attributes as your high-value customers and build ‘lookalike’ audiences,” co-founder Jon Lowen said.

Coupled with market-basket and e-commerce analytics, psychographics allow retailers to understand how purchasing habits percolate across their entire customer base. Applications range from inventory management to event and promotion planning to ultra-personalized customer interactions.

Data mining

In order to generate accurate insights at scale, retailers must assiduously maintain market-level datasets. Precise data mining can identify commonalities among millions of dispensary interactions and pinpoint differentiating factors between locations with high and low consumer ratings. According to Darren Roberts, chief executive officer at Green Mile Holdings, tailoring inventory and staff behavior based on customer reactions is very effective at encouraging repeat visits. In addition, monitoring brand and product metrics such as availability, price, and consumer ratings offers insight about the local product landscape: products competitors are carrying and their pricing, along with what products are trending in popularity.

“Our system aggregates publicly available data,” Roberts said. “It is capable of processing 100 million unique sources a day, extracting the relevant data and relationships, standardizing them, and generating a centralized database covering strains, brands, products, retailers, menus, consumers, and [online] reviews. This central database is then further enhanced by layering in first- and second-party data to create a full 360-degree view of the market and its consumers. We’ve received feedback that it’s helped retailers stay ahead of trends in the consumer marketplace, allowing them to continue to stock brands and products that are in demand.”

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Communication

Although text notifications are a great way to let customers know the status of their order or promote special deals and new products, too many texts can be irritating at best and a relationship killer at worst. Healthy communication with customers has limits. “It’s best not to send a text message campaign more than once a day,” said springbig co-founder and Chief Executive Officer Jeffrey Harris. “When sending too many texts, customers are more likely to opt out of all communications.”

He said one kind of communication customers may appreciate is the occasional reminder about rewards points they’ve earned for past purchases, assuming the establishment offers a rewards program. Harris believes such programs are underutilized. According to data analysts at Headset, rewards programs not only boost retention and loyalty, but they also can increase transaction dollar amounts by an average of 35 percent. Harris said springbig’s data indicate customers who have been loyalty program members for at least one year account for as much as 94 percent of participating dispensaries’ revenue.

Customers also may appreciate occasional notices about things like changes to store operating hours, new arrivals, and in-store events, but the notices perform better when they’re micro-targeted. For instance, customers who typically purchase edibles “are most likely to come in when they hear about edibles events,” Harris said.

Surfside’s Lowen said text messages aren’t the only way to keep in touch with customers. “You can do this with mobile and desktop ads to encourage a store visit or online order,” he said. The tactic is particularly powerful when combined with geolocation data. By delivering messages triggered by consumer behavior, “you can deliver very time-sensitive ads to in-market shoppers at the point of purchase by providing directions to your storefront and stealing market share from your competitors,” he said.

Just remember to obtain explicit permission from targeted consumers before embarking on any text messaging or other digital marketing campaign that involves pushing information or advertisements to consumers’ mobile devices. Sending commercial messages without explicit permission may violate federal law.

In-store experience and word of mouth

Product selection alone is no longer the primary reason consumers shop at preferred locations. Today’s cannabis consumers expect the same experience they’d enjoy at any other retail destination, and retailers are spending millions on design, in-store pop-ups, and the “wow factor” to give it to them. “The in-store experience truly differentiates a modern cannabis retailer,” said Mike Rappaport, director of customer success at Treez.

Whether it’s high-end consumption lounges, specialized product stations, or interactive menus, retailers must enhance the atmosphere. They also must ensure the shop’s layout is efficient and easy to navigate, and budtenders are friendly knowledgeable. Like any other retail operation, customer experience is key to success. “In addition to design, things like personalization, loyalty programs, rewards points, and staff that is equipped with thorough product knowledge are important,” Rappaport said. Deploying the elements seamlessly separates high-performing stores from the pack.

Denver’s Seed & Smith has gained new customers by offering a free tour of its co-located production, extraction, and packaging facilities. Also, according to Paul Hartje, the dispensary’s director of customer experience, by keeping the selection vast and fresh with a rotating selection of strains. The tactic’s benefits are twofold: ensuring new guests have options that meet their needs while satisfying returning customers who are looking for something new and different.

The store also incentivizes purchases. “In this competitive environment, we find most patients want a return on their spending that gives them better discounts on products as well as price breaks on apparel and accessories,” Hartje said. 

However, echoing Rappaport, Hartje acknowledged all the bells and whistles and deals cannot replace good old-fashioned customer service. Budtenders are the hospitality ambassadors for retailers. If they do not deliver a positive experience for the consumer, the consumer will not only go elsewhere but also tell their friends and family to go elsewhere. “If [budtenders] demonstrate a positive attitude and are able to educate our customers, we find [customers] will return,” Hartje said. “At the end of the day, what we want is for our customers to have had a unique and positive experience and to spread the word.” 


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TOOLS FOR THE TRADE

Jane Technologies Inc.

The retail technology company provides consumers with a safe and simple shopping experience through its online portal. Users can browse local products in real-time; compare by price, proximity, or popularity; and place orders at local stores for free. Jane partners with dispensaries in an uncommon way: Stores pay only for completed orders.

Surfside

Surfside offers solutions for retail outlets that want to identify prospects based on analysis of consumer similarities. The company’s system targets demographics, behaviors, shopping habits, and transaction histories so dispensaries can zero in on potential customers that match the profiles of existing customers. Surfside DSP can help dispensaries reach their desired audiences online and offline.

Green Mile Holdings

Green Mile develops community-based mobile personalization products and enterprise-level technology platforms. Its HighQ product combines data mining, first-party consumer data, large-scale market intel, and real-time data aggregation to focus on actionable information that’s qualitative, not quantitative. The platform can gauge consumer sentiment, collate top product categories, determine a brand’s market popularity, and create internal brand tracking by strain and product.

springbig

A customer-relationship-management and loyalty-program software developer, springbig’s user base numbers more than 8 million opted-in consumers. The company leverages data partnerships with point-of-sale software providers including Flowhub, BioTrackTHC, MJ Freeway, Treez, Korona, Leaf Logix, Green Bits, Blaze, and Cova and provides marketing services including text messaging.

Treez

Treez’s enterprise management software platform includes front of house, back of house, point of sale, and business development functions for retailers and cultivators, allowing companies to track inventory from seed to sale. Services enable retailers to deploy real-time order visibility, location-based inventory management, and technology-driven marketing solutions. The company manages more than $1 billion in transactions annually.

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