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Cannabis legalization has opened the door into a once very underground transaction, and technology solutions are seizing a rare opportunity. Modern technology, mass data collection, and a growing consumer base have created the perfect storm for marketers.
Cannabis businesses have a unique problem — an inability to advertise to the general public. While alcohol commercials and pharmaceutical ads plague social media, television, and even radio and billboards, cannabis businesses are restricted to extremely limited marketing options.
However, in 2020, the cannabis industry gained the “essential industry status.” In doing so, many states loosened restrictions and started allowing online ordering options, curbside pickup, and delivery to facilitate safe, touchless sales. And suddenly, cannabis retail evolved almost overnight.
The Perfect Storm of Progress for Cannabis
Essentially the cannabis industry is at a crux, a blend of modern technology, legalization, and destigmatization is creating the perfect storm for marketing professionals – one that is raining data. Three factors are contributing to this unique opportunity to see inside the mind of a cannabis consumer.
- Technology Adoption: Let’s face it, Americans are tied to technology. As of this year, 85% of the population owned a smartphone, according to Pew Research. We use our devices for everything, and we take them wherever we go.
- Growth of Ecommerce: The pandemic triggered an explosive demand in e-commerce and online retail functionality. Another report, published by Insider Intelligence, shows that e-commerce, in general, saw a 25% increase last year.
- Consumer Data: As the stigmas die and fear of criminalization subsides, consumers are more willing to stand up and be counted. Whether that’s accomplished by utilizing online platforms for purchases, signing up for loyalty programs, or answering surveys, cannabis consumers aren’t hiding in the shadows anymore.
Collecting data is easy. In today’s world, people shed data everywhere they go. Much like touch DNA at a crime scene, thanks to technology, humans leave an abundance of digital evidence through their online habits and mobile devices.
However, harnessing and using that data is a much more complex task. Learning how to interpret the data to make solid business decisions requires professional data solutions.
Create the Funnels for Data-Driven Marketing
Fire & Flower, a Canadian retail network, modeled their business to compete with general retailers, like those competing with Amazon. “At the top of the funnel, we built a customer loyalty and engagement platform, Spark Perks,” Trevor Fencott, Fire & Flower CEO, explained during an interview with Cannabis Tech.
“Today, we have over 310,000 members in the Canadian market,” he continued.
With a retail network of over 90 stores, Fire & Flower’s first acquisition, Hifyre, runs the tech stack, according to Fencott. He said, “Our Hifyre acquisition, as an engineering subsidiary, is the R&D arm of our company with 25 computer engineers and data scientists.”
Hifyre is a digital retail and analytics ecosystem that includes Hifyre ONE, a retail software platform designed for next-generation retail with scrolling screens, in-store promotions, and kiosks designed for in-store experiences. Another component, Hifyre IQ, is the advanced data analytics platform that provides deep buyer insights from all of the data points.
“It’s not just what’s selling; who is buying what you’re selling is the more important piece of it,” Fencott explained.
The company’s most recent announcement to acquire Wikileaf only continues their efforts to build out their customer acquisition channels, not only for themselves but for other LPs and MSOs. Fencott says the Hifyre subsidiary will transform the platform by creating white-labeled virtual dispensaries that allow consumers to shop, complete orders within a few clicks, and fulfill them at various locations.
Create the Connection, Build the Brand Loyalty
Marketing campaigns often walk a fine line with buyers. Too many pointless ads will turn away a loyal customer, but a well-thought-out campaign can practically drive them to your door. Using data to determine who wants to see your ad, when, and where can make all the difference in creating a solid relationship and building brand awareness.
Technology and data mining allow producers and retailers to connect the dots between various consumer personas, which feels far from personal. Surfside, an end-to-end marketing platform, uses technology to go beyond data insights to create a more authentic dialogue and truly connect with the consumer.
Using data integrations with a myriad of e-commerce sites, point of sale systems, and numerous CRM platforms, Surfside collects data or customer touchpoints. Then, it combines that data with other attributes such as age, demographic, household income, and frequently visited places to build data-driven approaches to marketing.
“We use that data to measure the effectiveness of advertising, and we empower brands to be able to measure the success of their various campaigns and strategies,” said Jon Lowen, co-founder of Surfside, during a recent interview. In other words, using the data they’ve collected, they serve the ads the consumer wants to see. This targeted approach is more sensible for the highly regulated industry.
“The cannabis industry has a number of unique challenges, varying legal and regulatory landscapes, highly sensitive data points, and businesses struggling to simply get an ad out because mainstream platforms like Facebook and Google would shut them down,” Lowen added. “Surfside allows brands and retailers the ability to serve ads in a compliant way.”
By collecting and analyzing the data, the platform is able to build tools and solutions to help retailers see and understand fundamental customer behavior such as visitation metrics, competitor overlap, and exclusivity.
“The appetite for spend around customer acquisition and brand awareness is continuing to increase,” Lowen commented. “And, truthfully, we’re just getting started.” Recently announcing a $4 million investment in Surfside, Snoop Dogg’s Casa Verde Capital sees the potential in the company’s approach.
The Early Bird Collects the Most Data Crumbs
While many cannabis companies in the United States have limited competition today, forward-thinking visionaries know that will change. As legalization inches closer, it’s safe to anticipate that interstate commerce and an influx of competitors will drastically change the cannabis landscape.
Getting ahead of the data now can make all the difference in brand awareness later. Utilizing the available tech platforms can simplify the process.