Best Practices

Tips For Keeping Your Customers Out Of The Illegal Market

Here are 5 tips that should help make sure you keep your customers

Whenever legalization as a topic goes mainstream in a given state, one of the arguments you hear in favor of it is that a legal market will be a death blow to the illegal market.  While legal options certainly do pull customers away from illegal sellers, the truth is that the illegal market remains a concern for anyone dispensing cannabis legally.

This means that marijuana entrepreneurs must always be looking for ways they can pull in customers who consider illegal market purchases a viable option.  The key to doing so is offering products and services that go above and beyond what non-licensed sellers can deliver.

So, what are some options available to you?

Customer Rewards Programs

When it comes to ways to incentivize buyers, look to methods used by long-standing retailers.  One method commonly used is the customer reward program.  These programs track the money a customer spends in store and then offer a reward for their loyalty.  These rewards can be coupons, special discounts, or points that can be redeemed once a certain amount is acquired.

Many cannabusinesses use rewards and loyalty programs.  Dockside Cannabis in Washington State is one such retailer.  They use a point-based system and offer their customers free points the moment they sign up.  After that, every time they check in on the store’s iPad, they earn more points.  This is a great method for getting them into the store as well as encouraging them to purchase once there.  And since their points are redeemable for a certain percentage off, it also encourages them to purchase more expensive products or more products in a single purchase.

Text Messages and Newsletters

Another way to bring in customers is just keeping them aware of what you offer.  The more you can stay on their mind, the more likely they are to purchase from you.  Of course, the hardest part is getting them to sign up for your updates.  One option is to offer them an initial coupon when they sign up.  This strategy is used by major retailers as well as marijuana businesses, including Hawaii’s Aloha Green Apothecary.  Just be careful not to overload customers with communication as this can come off as spammy.

Community Assistance

People need product.  People also like to feel as though they are helping others.  You can combine these two by connecting your community assistance efforts to the purchases of your customers.  For example, Bloom Farms in California donates one meal to a local food bank for every product sold.  There are many ways you can structure this, and you should select a charitable cause that will appeal to the majority of your customers in order to best incentivize them.

Unique Products

The best way to beat the illegal market is to offer your customers what it cannot.  While all of the items above are things that the illegal market does not traditionally offer, motivated sellers could find ways to offer something similar enough.  But when it comes to products, there are certain items the illegal market simply does not—or cannot—offer.  For example, CannaCraft in Northern California offers strain-specific vape cartridges and a line of products that comes in five ratios of CBD to THC; both of these allow purchasers to receive a custom experience.

Safe Experiences

Finally, one aspect the illegal market will never beat the regulated market on is safety.  When trying to bring in customers, you want to emphasize this aspect.  Educate the public on harmful materials found in products on the illegal market—yeast, mold, heavy metals, and pesticides—that are not found in tested and regulated products.  Explain how products are tested and what standards they must meet.  The more your customers know, the more they will trust you; the more they trust you, the more likely they are to turn to you for their cannabis needs.

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