As 4/20 approaches, dispensaries are preparing for an exciting day filled with events, discounts, and most importantly, customers. It is no secret that 4/20 is one of the busiest days of the year. But how does the day impact your overall customer base? Does it bring in a plethora of new people, who then become returning customers, or are they one-timers? Are the demographics of your customers different, or do they still fit the same profile? A diverse customer experience and customer base is essential for a cannabis business. Here are the key metrics you should be looking at to measure the impact of 4/20 on your customer base.
Types of people you can expect to see:
While there are many different types of customers who may visit a cannabis retail store during the 4/20 holiday, here are a few common segments and strategies to consider for your cannabis business:
- Cannabis Enthusiasts: These customers are already familiar with cannabis and are likely to have a regular consumption routine, have a solid understanding of the different product offerings, and know exactly what they want.
- Casual Users: These customers use cannabis occasionally, such as on weekends, during social events, or as the occasional “treat” for a special event or a way to wind down after a particularly stressful time. They are familiar with only a few types of products or brands, and will likely need some assistance navigating the offerings.
- First-Time Users: These customers are new to cannabis and may be curious about trying it for the first time; or have tried it once or twice with friends and are purchasing for the first time. They will have the least knowledge of products and likely are only familiar with flower or edibles, and will likely need a lot of help and guidance to get the best items for them.
- Medical Cannabis Users: Most medical users are well versed in cannabis products and know exactly what they need for their specific condition. They may be interested in learning about different products to supplement their specific prescription, but likely already know what they want or what specific new products they need.
- Tourists: These customers are visiting the area, almost always from a state where it isn’t legal. They will typically fall into 2 camps: First time users or enthusiasts. First time users will be looking for help and a sampling of different products to try for the first time, the enthusiasts are usually looking to do a major stock-up, since their trips are less frequent.
Understanding these basic customer profiles can help you staff different skills. Consider assigning customers to bud tenders based on the customer profile and the bud tender’s skills. Next, let’s look at how we can analyze these customers on 4/20
What insight you should be measuring from the diverse customer base:
New Customers: Using your POS / registration system, track how many new customers sign up at your dispensary. If you start your 4/20 discounts a few days early, make sure you count those early days, too. You then want to compare the volume and rate of new customer sign ups to other parts of the year. Understanding whether you are bringing in new customers or just a higher volume or existing can help you discount more effectively on 4/20, but also plan new marketing initiatives outside of 4/20.
Appature and its Treez integration helps you by actively tracking new customer sign ups per month. Its incredibly easy to compare different sign-up volumes over time. You can even use this tool to compare new sign-ups during other major promotions!
Customer Retention: Retention shows you the ratio of returning customers vs new customers. You should already be tracking your retention to give you a baseline to measure 4/20 from. Each dispensary’s 4/20 goals should be different, and your expectations around retention should reflect that goal. For example, if you are expecting an influx of new customers, your retention will go down. Compare this to new customer volume – on 4/20 you may get a high number of new customers, but even more returning customers, making your retention rate actually go up!
Customer Demographics: The final piece of customer analysis for 4/20 is understanding who are the people who come and make a purchase during that time. Not only do we want to know if they are a new customer or not, but what are some details about them as a person? Appature and its Treez integration make this easy through the Customer Retention and New Customer volume reports. Both reports are filterable by generation / age group and customer’s identified gender. Knowing these key demographic details allows you to understand:
- What kinds of people use our dispensary regularly
- What kinds of people show up on 4/20
- Where do we have room for growth?
Using this information, you can look at past 4/20 events and see what kinds of new customers you brought in. You can then plan your marketing and discounting strategy around incentivizing demographic areas you want to grow, rewarding existing customer base, or maybe even both!
Regardless of what POS system you use, knowing your customer base, and what kinds of customers to expect will be critical to your 4/20 success.
The bottom line
The 4/20 holiday is not just another day in the cannabis retail world – it’s a golden opportunity to drive sales and take your business to the next level. By focusing on education and helping customers make informed decisions can help you establish your store as a trusted authority in the industry. Additionally, the 4/20 diverse customer data insight you should be gathering such as new customer insight, customer demographics and customer retention will allow you to identify long term strategies for success around the 4/20 calendar holiday. With these strategies in place, you can unleash the full potential of the 4/20 holiday and create a lasting impact on your business growth. Don’t miss out on this unique occasion – seize it with confidence, creativity, and passion!
Thanks for reading and happy reporting!
FAQs
How can cannabis retail stores personalize the customer experience during 4/20?
Cannabis retail stores can use data analytics platforms like Appature to gain insights into their customers’ preferences and behaviors. This information can be used to create personalized recommendations and offers that will keep customers coming back.How can cannabis retail stores educate customers about different strains, products, and consumption methods during 4/20?
Cannabis retail stores can use a variety of methods to educate customers about different strains, products, and consumption methods, including in-store displays, brochures, and consultations with knowledgeable staff members. It’s important to provide accurate and trustworthy information to customers to build trust and establish your store as a reliable source of information.
What is customer retention data
Retention is calculated by comparing the customers you have at the start of a period (CS), the amount you have at the end of a time period (CE), and the number of new customers over that time period(CN). You calculated it as:
Retention = ((CE-CN)/CS) x 100.
The number produced is a percentage of your customers over the selected time period that are returning customers. A high percentage (90%, for example) means the majority of your customers were existing returning customers. A low percentage (20%, for example) means the majority of your customers were new.
What does customer demographic data include?
Customer demographic data typically includes the customer’s:
- Age / relative age / generation
- Gender
- ZIP code / city of residence
