With more than 18 states and Washington D.C. now having legalized recreational cannabis use, the market is growing. In addition, over 39 states have legalized medical cannabis use. The changing laws have resulted in the need for operators to understand cannabis dispensary customers and how to improve dispensary loyalty marketing.
Cannabis Dispensary Customers
Today’s cannabis customer is 39 years old, on average. Men continue to outnumber women in this area. The most recent research suggests that customers break out as 53% male and 47% female. By gender, researchers have noticed differences in why consumers use these products. For women, mental or physical health issues drive their decision to try cannabis. In addition, millennials are more likely than members of other generations to visit their local cannabis retailers.
A sizeable number of consumers also use cannabis products for medical purposes. The most common symptom driving consumers to register for medical cannabis use is pain.
Cannabis operators should keep these details in mind as they set up their retail space and stock their shelves.
How Much Does the Average Dispensary Make
In asking “How much does the average dispensary make?” it’s important to know that there’s a significant range in revenue numbers. The average cannabis dispensary reports revenue ranging from $1 million to $3 million. While revenue may be growing for these businesses, profitability is another matter. States continue to heavily tax “recreational” cannabis retailers, as they do with alcohol and cigarette retailers.
Taxes are not the only financial challenge facing dispensaries. They must stock the kinds of products their customers want. About 16% of consumers regularly use cannabis. For 27% of these clients, the variety of product offerings at a cannabis retailer matters. These days, some of the most popular products include flower and pre-rolls. But edibles have found a following with loyal customers as well because some consumers are wary of smoking.
Regardless of the average dispensary sales in any market, profit pressures are increasing. States control the number of retailers that can offer these products. But as more retailers open their doors, price pressures are increasing. When operators must drop their prices to sell more, profitability suffers.
As a result, it may be more important to know what profitability looks like instead of focusing on asking, “How Much Does the Average Dispensary Make?”
Dispensary Loyalty Marketing
One way out of the profitability pressure is to increase dispensary loyalty marketing. In many states, regulations limit the kind of marketing dispensaries can engage in. These regulations explain why 78% of cannabis retailers use their company website as a promotional vehicle, but only 12% engage in TV or radio campaigns. In terms of traditional media, out-of-home marketing is strong in this sector, with 39% of cannabis retailers using the format.
While this type of advertising can strengthen brand awareness and attract interest from consumers, loyalty marketing can drive increased revenues. We all know that it is less expensive to sell more to an existing client that it is to recruit new ones. The best loyalty campaigns will be personalized, based on what a specific customer purchases. Dispensary loyalty marketing programs can include email campaigns and text message marketing.
To learn more about the types of advertising cannabis customers respond to, check out AudienceSCAN on AdMall from SalesFuel.
Beyond loyalty marketing, cannabis shops may want to increase brand awareness in their market in order to increase average dispensary sales. Let your local operators know that as consumers are cutting back on alcohol consumption, they’re seeking alternative substances. One recent study finds that over 20% of consumers between the ages of 21 and 54 are turning to cannabis and CBD products.
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