The Basics of Retail Cannabis Marketing

In case you missed it, we touched on the basics of marketing in our beginner’s guide on the subject. It’s a great primer on the subject and will set you up for a better understanding of marketing your cannabis dispensary as we move through more specific areas on the topic.

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Introduction to Retail Cannabis Marketing

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Cannabis retail marketing is just an industry-specific form of marketing. It refers to the strategies and tactics used to attract and retain customers using a wide range of activities, such as:

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• Advertising
• Public relations
• Promotions
• Customer engagement
• Collaboration

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You probably already know that the retail cannabis market is highly competitive. It’s tough to stand out in a crowd. Fortunately, effective marketing can help you to differentiate your dispensary and build a loyal customer base.

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The Importance of Marketing in the Cannabis Industry

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The adage "if you build it, they will come" doesn't hold true in the cannabis industry without solid marketing efforts. 

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The necessity of medical cannabis and the popularity of retail cannabis are not enough to bring customers through your doors in droves. Many potential customers in either of those two camps are unaware of the options available to them. 

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For that reason, dispensaries have to invest in marketing to educate consumers, build brand awareness, and drive traffic to their stores. Above all, you have to provide value to outshine your competitors in the eyes of customers.

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Key Differences Between Cannabis Marketing and Other Industries

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Marketing cannabis presents some unique challenges and opportunities not found in other industries.

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Here are some of the key differences:

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1. Relationship-Based Marketing: Unlike many other industries, cannabis marketing heavily relies on building relationships with customers. It’s a personal purchase. Because it’s something that goes on or in our bodies, we need to trust it won’t harm us in some way. Building the relationships between people is one way to strengthen the consumer’s relationship to a product.

Consider back when the illicit market was the only option, everyone had a ‘plug’. That relationship was built on being reliable, trustworthy, and providing a good product at a fair price. (or, sometimes, the simple availability of any product)

Trust and reliability are particularly important for medical cannabis patients who need consistent and effective relief. They will look to you as an advisor of sorts, seated squarely between a bartender and a pharmacist.

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2. Experiential Marketing: Marketing cannabis products, especially new ones, often requires an experiential approach. Most people will stick with what’s comfortable and familiar otherwise. 

Introducing customers to new products and new relationships among staff or other consumers can help strengthen ties between people and businesses while at the same time introducing them to new ways of experiencing the benefits of cannabis. 

In this way, dispensaries can effectively use marketing by hosting events, providing samples, and offering in-store experiences that allow customers to learn about and try products before making a purchase. Consider workshops that introduce consumers to new ways of enjoying the plant or expanding the ways they already do. That can include cooking, rolling, massage workshops for friends and partners using topicals, or other means of enjoyment.

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3. Medical vs. Recreational: Marketing strategies can vary significantly depending on whether the focus is on medical or recreational cannabis. Medical cannabis marketing needs to emphasize efficacy, safety, and patient testimonials, while recreational marketing can be more lifestyle-oriented, highlighting enjoyment and relaxation.

The biggest opportunity in retail cannabis marketing cannot be overstated.

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Legal cannabis is one of the very few industries, maybe only comparable to the pharmaceutical industry, where the customer is observed and understood every step of the way. 

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Legal markets require intensive oversight of how cannabis products move through the supply chain, who is buying them, in what quantities, all of that. That includes all the first-party data connected to your customers. You can quite literally see exactly what specific people buy and align your marketing with those habits and preferences. 

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You have an opportunity here to know and connect with your customers in a way very few industries allow. 

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To not pay attention and ignore what your customers are telling you in this way is almost a guarantee that your marketing will fail and you will struggle to run a successful retail cannabis dispensary.

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Compliance with Cannabis-Specific Regulations

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Expanding on that big opportunity we mentioned above, marketing in the cannabis industry is heavily regulated. Strict guidelines govern what you can say and do from state to state.

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Dispensaries must navigate these constraints carefully to avoid penalties and maintain their good standing with regulators. Become as familiar as possible with your local regs, down to the municipal level, as each city or town may have different regulations from the state.

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Legal Considerations & Compliance

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Cannabis marketing regulations cover areas like advertising channels, content, and target audiences. For example, states often prohibit cannabis advertisements on platforms where a significant portion of the audience is underage. Regulations also often restrict certain claims about the benefits of cannabis products. Some states disallow billboards. The list goes on.

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Here are some particular areas of marketing in retail cannabis to pay close attention to how you can remain compliant with your local laws.

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Terminology, Visuals, and Claims

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• Terminology: Avoid terms that could be considered appealing to children or interpreted as making unfounded medical claims.
• Visuals: Imagery must not be appealing to minors or misleading. Often, font sizes and warnings have specific rules and need to be included on advertisements.
• Claims: Only make claims that are supported by scientific evidence and comply with local regulations.

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Tips for Staying Compliant

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1. Stay Informed: Regularly review state and local regulations to ensure compliance. These rules can be amended at any time, so it’s important to review them regularly.
2. Consult Legal Experts: Work with legal advisors who specialize in cannabis law to vet marketing materials.
3. Train Staff: Ensure all employees involved in marketing understand the regulations and the importance of compliance. This one is SO important. Having well-trained staff communicates volumes about the quality of your dispensary and how it operates. Not only that, but it instills confidence in your staff as subject matter experts. In short, It says a lot without having to say a lot.

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Core Marketing Principles

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The 4 Ps—Product, Price, Place, and Promotion—are fundamental concepts in marketing that apply to the cannabis industry just as they do in other sectors.

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Let’s break it down, P-by-P:

1. Product
   • Quality: Ensure that your cannabis products are of high quality and meet customer expectations. COAs are great to have on hand for when they are requested. Moreover, you should be trying these products yourself so that you can speak on them intelligently when asked about their characteristics.
   • Variety: Offer a range of products to cater to different customer preferences and needs, including flower, edibles, drinks, concentrates, tablets, and topicals.
2. Price
   • Competitive Pricing: Conduct market research to price your products competitively while ensuring profitability. Utilizing cannabis dispensary purchasing software will ensure you are not over-stocking or holding dead-weight inventory on your shelves.
   • Promotions and Discounts: Use promotions and discounts strategically, not frequently, to attract new customers and retain existing ones.
3. Place
   • Store Location: Choose a location that is accessible and convenient for your target audience. Determine how little or how much competition is already set up in the area.
   • Layout: Have an intelligent layout to your store that introduces customers through your selection of products without friction and leads them to the point of purchase comfortably.
   • Online Presence: Develop a user-friendly and well-performing website and consider offering online ordering or delivery services where regulations permit.
4. Promotion
   • Advertising: Utilize various advertising channels, such as social media, SEO, and local media, while adhering to regulations.
   • Public Relations: Build relationships with local media, local businesses, and even influencers to generate positive publicity.
   • Customer Engagement: Use loyalty programs, email marketing, and in-store events to engage with customers and encourage repeat business.

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Customer-Centric Marketing Approach

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To succeed in the cannabis retail market, dispensaries must adopt a customer-centric marketing approach. This involves understanding the needs and preferences of your customers and tailoring your marketing efforts accordingly.

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The easiest way to gauge sentiment, get feedback, and inform your customer marketing is to, drumroll please, talk to your customers.

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Here’s how you do it.

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What Channels Work?

• Social Media: Platforms like Reddit, Instagram, and X (Twitter) can be effective for reaching a broad audience, but be mindful of platform-specific restrictions on cannabis content. Visual imagery, video, and just plain being available to interact with your audience in these spaces will boost your credibility in the eyes of long-time and potential customers.
• Text and Email Marketing: Build an opt-in list to share promotions, educational content, and updates directly with your customers through dispensary text and email marketing.
• Search Engine Optimization (SEO): Optimize your website for search engines to attract organic traffic from people searching for cannabis products in your area. Focus on local or regional keywords and terms throughout your google business page and content published on your website or blog. This will ensure you come up in Search Engine Results Pages (SERPs) where people are looking for dispensaries or cannabis products in your area.

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Where Are Your Customers?

• Local Community: Engage with your local community through sponsorships, events, and partnerships with local businesses.
• Online Forums and Communities: Participate in online cannabis forums and communities to connect with potential customers and build brand awareness.

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Conclusion

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Marketing is crucial for the success of any retail cannabis business. 

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You can effectively attract and retain customers by:

• Adopting core marketing principles
• Understanding the unique challenges and opportunities in the cannabis industry
• Building relationships and focusing on customer-centric marketing
• Providing quality experiences
• Staying compliant with regulations 

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Set your dispensary apart in a competitive market and put these elements of retail cannabis marketing to work for your business.

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For more info or to see tools that can take your marketing even further, hit us up for a demo of Happy Marketers and see what sets us apart from the competition in text and email dispensary marketing.

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