🔑 The budtender still holds the key

Good morning. I made this chart ^ for you.

⭕️ The relative influence over consumer decision: cannabis edition

The thicc-ness of the circles shows the influence of each supply chain participant over consumer purchase decisions. Here’s how:

• Cultivators, processors, testing labs: they do give us the raw material, and perhaps slightly less-raw wholesale material, as well as the scientific indication that the material is safe for human consumption; but, there are many influential steps after them in the supply chain

• Distributors: they have more influence over consumer purchase decisions than cultivators, because they ultimately transport the goods to retail establishments. They also dictate which brands they’ll work with, and which brands will benefit from their logistics / delivery infrastructure

• Brands: my marketing friends know all too well how important branding is to consumer decision. Whatever their unique value proposition is (credibility and expert genetics like Cookies, cool style and good vape hardware, flower, etc. like Stiiizy, a fun alcohol-substitute like Cann, etc.), they can influence two things:

  • Distribution (e.g. getting into as many doors as possible by convincing purchasing managers that their products will sell)

  • Rate of sale / velocity (e.g. ensuring that their products actually do sell by supporting sales efforts with great consumer marketing campaigns)

• Tech providers: technology companies have a ton of influence over what products are purchased. eCommerce represents anywhere from 25-45% of total sales depending on where you look, and in-store tech accounts for a good chunk, too. If you work with a subpar eCommerce provider, for example, consumers will buy weird, irrelevant shit

• Retailers: like it or not, retailers still hold the most influence over purchasing decisions. Why? Because, assuming you are shopping legally, you have to shop at a retailer. It’s where all of the transactions actually happen

🏥 Ah yes, the retailer

The retailer: that wonderful, enigmatic license holder.

Retailers, as you probably know, come in all shapes and sizes. There are 100-store, publicly-traded chains. There are 1-off “mom and pop” shops littering the country (with a lot in Oklahoma). There are delivery-only operations that have fleets of branded cars.

And they all hold more power to influence consumer decisions than just about anyone else in the space. 

🏁 Let’s talk intent

To understand why the retailer holds the keys to the castle, let’s talk purchase intent.

Think about your likelihood to make a purchase in various CPG scenarios:

If you go shopping for clothes, there’s maybe a 50% chance you’ll find something you like and buy it. Or maybe less.

If you go shopping for groceries, you probably will buy most of what’s on your list. Let’s say each item has a 75% chance of being purchased.

If you go to Chipotle to buy a burrito, there’s an even higher chance you’ll walk out with a burrito.

(The upward trend here is immediacy - you aren’t going to use those clothes right away, probably. Groceries you’ll use over a week. You’re going to crush your burrito in the car).

Now think about intoxicants - what are the chances you walk into a vape shop and leave empty-handed? A liquor store?

How about a dispensary?

When someone wanders into a shop that sells immediately-consumable intoxicants, the chances are high that they’ll purchase something.

We see the same trend when we compare online conversion rates for cannabis vs. online conversion rates for anything else; the likelihood of purchase is just higher out of the gate.

👸🏾🤴🏽 The budtenders are the queen and king and non-binary royalty of retail; how can brands influence them?

Budtenders are the nice, funky folks that walk you around the dispensary and guide your purchasing journey.

They are the gateway to that beautiful moment of truth before you fork over your cash.

So…how can brands increase their influence and ensure they are top-of-mind so that the first thing that comes out of a budtender’s mouth is something nice about their product?

1. Educate them

Brands should create and maintain a lasting relationship with budtender staff, and use that relationship to reinforce facts and nuances about the brand.

I was selling Jane into a big West Hollywood store when I got to watch the old Lowell team come in for a quick educational session; it was very well done. It allowed me to see a very solid sales person expound on the virtues of the Lowell heritage, tell the story, outline the products, and leave behind goodies. Which brings me to my next step…

2. Incentivize them

I’ve heard of fun budtender competitions, free swag, free product, access to cool events, even outright cash money. However you can incentivize budtenders to think fondly of you (as long as it’s legal), you should probably do that.

3. Get close with retail management and let them know you’re working for that velocity

Ultimately, retail management (owners, GMs, c-suite, whatever the strategy-setters are) can mandate budtender recos. That’s how MSOs push their in-house, margin-accretive brands. So, it behooves brands to ensure that everyone at retail that could influence the budtender’s talk track - strategy-setters and the budtenders themselves - are included in the romancing.

If you can keep a close relationship and then prove you are doing something to help them move product and justify your shelf space (marketing campaigns, ads targeted to send traffic to that retailer, etc.) - then you’re in a good spot.

Note on the digital budtender

There are a few systems that can act as AI-enhanced recommendation engines. A digital budtender, if you will. There a lot of add-on companies that have pretty good widgets; I won’t mention them here because someone always feels left out.

eCommerce platforms can also behave as a digital budtender, by personalizing and prioritizing products based on what is most likely to delight the individual shopper. And shoppers are more likely to buy what delights them.

📚 tl;dr

• Relative to other players in the supply chain, retailers hold the most influence over consumer purchase decision

• Purchase intent is sky-high when someone loads a cannabis menu or walks into a dispensary

• Budtenders hold the keys to that precious moment of truth before someone hands over their money

  • Educate them

  • Incentivize them (legally)

  • Make nice with retail management and make sure they know you are doing your best to help them move product

• It is…Wednesday??