Cannabis Education at Retail: A Variety of Models For a Complex Category
“We will provide a new experience for our existing community and look forward to welcoming new customers who will come to see cannabis in a whole new light,” Jesse Channon, Chief Growth Officer, Columbia Care
Recently Columbia Care, a cannabis multi-state operator (MSO), announced the launch of a consistent retail experience across their myriad of retail and dispensary locations with a focus on attracting new consumers, no matter what level of cannabis experience. This move makes sense, as more markets legalize medically and/or recreationally one of the best way to drive revenue and grow the business is by attracting new consumers to the category. Given cannabis’ myriad of formats, proliferation of brands, historical stigmas and misinformation this is no easy task. Consumer education at retail is one way to drive more new consumers into the category, and drive more sales for existing customers.
The Strain Component of Cannabis
Helping customers at retail is nothing new, but it takes on a whole level with cannabis. Not only do customers have to navigate a variety of product formats, from Edibles to Vapor Pens to Pre-Rolls and beyond, they have to contend with the broad strain variety and their nuanced effects.
Strain-dominant Formats Dominate
A majority of cannabis categories that are sold are strain-derivative products, with some exceptions being sold based on intended effect, for example ‘relaxed’ or ‘calm’. Shopping for cannabis is unique, in that different strains may instigate different effects for the consumer, with some causing drowsiness while others may be uplifting along with a whole host of other effects that consumers may be asking about.
Given the cannabis consumption experience can be nuanced, consumer education is paramount, for new consumers in the category that may shop based on their ideal experience for example those that are looking for a sleep aid, or experienced consumers that want to sample new genetics, and are looking to learn more about the effects. All of this requires significant consumer education, often through online resources or through consultation with the service provider or ‘budtender’ at the point-of-purchase.
Strains as Differentiators
In many ways strains act as brands unto themselves with some genetics being proprietary and unique to a particular product manufacturer, and others leveraged across a variety of processors. When looking at consumer profiles at Headset, we note that consumers are more loyal to strains than they are specific product manufacturers which means a consumer who enjoys the Wedding Cake strain may sample the strain by purchasing it from a variety of distinct brands.
By creating proprietary genetics, cannabis brands can differentiate themselves in market generating a reputation for unique strains that help them stand apart from others. Brands like Cookies do this well, introducing best-selling strains like Gary Payton, created in collaboration with the NBA All-Star and unique to the Cookies brand. Other brands may produce and distribute more well-known and readily available strains, like the infamous Blue Dream as a way to drive consumers who may be partial to those particular genetics.
Consultative Shopping
Building a retail framework that supports consumers helping them better navigate the cannabis category even beyond strain education is critical. It goes beyond dispensaries simply emulating an Apple store layout and expands into providing an Apple ‘Genius’ like shopping support.
The model in cannabis varies significantly from store to store and state to state. Medical dispensaries require a check-in process and incorporate lobbies where patients wait to be welcomed back to make your purchase. Adult-use retailers often carry this model into 21+ purchases, which ends up serving as a more consultative approach while others focus on throughput with a more flexible shopping experience sans lobby.
The Role of Technology
Technology seems to be further supporting the shopping experience, whether through online menus or in-store kiosks, leveraging technology can help scale the throughput of consumers. While no replacement for the budtender, in the near term technology based solutions may support shoppers who have quick questions, or are perhaps too embarassed to ask what they might consider basic questions. Taking the in-store experience and bringing consumer education online will also be required to leverage technology as more of the transaction is occurring through e-commerce for delivery or preorder and pickup.
What to Watch For
With new strains there will always be new questions, and being able to support customer education at retail will always be important. Seeing trends like the recent Cannabist store announcement from Columbia Care which focuses on a large footprint providing the same shopping experience across markets in the U.S. built around an eduation component may begin to drive expectations around what a cannabis store looks like.
In the near-term, will we see the waiting-room lobby model expand from its medical roots into adult-use, or will it transition into a more transactional grocery model, or perhaps the sweet spot for the years ahead is somewhere in between?
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