According to Green Market Report:
“Operating a cannabis dispensary can be a lucrative business, but only if people know it exists—and prefer it to other dispensaries in the area. Just selling cannabis isn’t enough to get you the profitability and sustainability you need to make your business successful. You’ll need to market and advertise that business if you want people to hear about it and trust it.
Marketing Tips for Cannabis Dispensaries
“These tips can help you better establish your brand and attract more customers to your dispensary:
- “Differentiate your brand. Customers in your area probably have many dispensaries to choose from, so what makes yours different? Do you have a wider range of products? Can you afford to sell at lower prices? Do you provide more individualized, personal customer service? The exact method of differentiation doesn’t matter, so long as you have some way to show that you’re better than your competitors.
- “Remain consistent. Advertising is most effective across many iterations, due to the mere exposure effect. But for this effect to manifest, you’ll need to be consistent. You’ll need to present your brand in the same way, adhering to the same values, and giving consumers the same kinds of images, tone of voice, and other brand hallmarks. Make sure you’ve documented your brand standards thoroughly, and inspect each marketing or advertising material that gets published to ensure it adheres to those standards.
- “Appeal to a local audience. While some dispensaries are able to sell to customers in many different areas, most are limited to a local audience—or will at least be getting most of their revenue from a local audience. Dedicate a significant chunk of your advertising budget to channels and methods that work especially well for locals, like printing and distributing flyers or putting up a billboard that residents can see.
- “Watch your costs. You’ll need to watch your budget carefully if you want to succeed. If you spend too little on marketing, or don’t advertise at all, you’re never going to achieve the growth you want. But if you spend too much on campaigns that don’t work, you’ll be in an even worse position. Your goal is to maximize your return on investment (ROI), which means selectively choosing the most effective and cost-efficient strategies. You can do this by starting with minimal investments, measuring your results, and preferentially keeping the best-performing strategies per dollar spent.
- “Segment and target your audience. You can improve your results by selectively focusing on niche audience segments. Who are your primary customers, and what are their biggest priorities? Are they purchasing cannabis for an underlying health condition, or to partake recreationally? What kinds of messages and images will evoke the best response from them? Market research is imperative here.
- “Invest in SEO. Search engine optimization (SEO) is one of the best overall online marketing strategies. Utilizing a combination of onsite content development, offsite link building, and other tactics, you’ll flesh out your online presence and increase your rankings in search engines, ultimately generating more traffic for your site. It’s a long-term strategy, so it won’t yield immediate results, but the long-term value is unparalleled.
- “Experiment. It’s also important to experiment, since you can’t be sure which tactics, channels, or messages will be most effective for your audience. Try out a wide variety of different approaches, and make sure you measure your results so you know what works.
- “Understand the regulations. Finally, but perhaps most importantly, make sure you understand the marijuana advertising laws in your state. Some states are stricter than others, but in nearly all states, you’ll be responsible for providing factual, provable information about your product and displaying it in a responsible way. In some cases, you’ll need to advertise your business, rather than your product, and in some states, you may be dealing with no specific marijuana advertising laws whatsoever. Work with a lawyer if you’re not sure how to proceed.
Customer Retention vs. Acquisition
“It’s also important to realize that for most dispensaries, customer retention is cheaper than customer acquisition—in other words, it’s less expensive to keep a current customer happy and buying your products than it is to find an entirely new customer. With that in mind, it’s a good idea to invest in strategies that will keep your customers happy and loyal, like rewards programs and exceptional customer service, in addition to spending money on marketing and advertising.
“Cannabis dispensaries perform better when they have a solid marketing and advertising strategy pushing them forward. It may not come together right away, and your return on investment (ROI) may be low in the beginning stages, but if you continue to test and improve, eventually, you’ll piece together a campaign that works.”