Strengthen Customer Loyalty
Can you believe we’re only 10 years into adult-use cannabis sales? 2012 marked the first states (Colorado and Washington) to make their move into recreational cannabis.
These last 10 years have been incredibly busy resulting in a total of
18 states have legalized adult-use cannabis programs
37 states have medical cannabis programs
All 50 states have allowed for the sale of CBD products
With the current market combined with the potential of federal legalization, early retailers are trying to find ways to acquire, and more importantly, keep customers returning. Some of the strategies we see are around loyalty rewards programs and digital communication.
Digital communications seem to continue to be a cat and mouse game with the FCC, but loyalty rewards programs are dominating when it comes to customer retention. Giving a consumer a reason to stop back into the store creates another opportunity to provide customers value.
What we tend to see in loyalty programs:
Branded swag
Coupons/Promotional marketing materials
Branded Products
The balancing act becomes giving away too much vs. not enough to keep consumers interested. Most loyalty rewards programs do not require a subscription or even significant spending to get into the retailer will be on the hook to cover the costs.
Our experience has shown that CBD products fit really well into the loyalty rewards program for 3 key reasons:
CBD are cannabis products that overall have less regulation around what can be given away and what needs to be sold
Suggested retail price vs. wholesale cost provides the consumers enticing value while maintaining a low-cost structure for the retailer
Having a house brand of products with the retail information is an opportunity for another impression; which is critical to developing consumer trust
Customer acquisition and retention spending are going to continue to play a major role in retail strategy as more states, cities, counties, cities open their doors to retailers.
Interested in developing or refining your customer loyalty program? Let’s start the conversation.
About the author:
Nick Young is a cannabis entrepreneur focused in processing and product development in both hemp and marijuana markets. Nick has been a featured speaker at the Lean Farm School and iHemp Midwest speaking on industry innovation and process. Nick is also a tortured Detroit Tigers, Red Wings, Lions, and Pistons fan.