Acquiring new customers is challenging for most industries; however, it is especially difficult for the cannabis industry. It’s a highly competitive and fast-growing market where new brands are emerging every day. To be successful, cannabis brands must find ways to differentiate themselves to consumers.
By collecting and understanding data and insights from current consumers, cannabis businesses can develop products to attract new consumers. In addition, through product education and personalization, companies can target specific clientele to increase their national brand recognition within the industry.
Using education to gain new customers
Misconceptions about cannabis have circulated our society since the beginning of the War on Drugs. For that reason, the general public is still largely uneducated when it comes to marijuana, unfortunately.
We know that cannabis consumers are the minority; so it is important to educate the general consumer since states’ legalization of medical marijuana and recreational cannabis is still relatively new. Eventually, cannabis will be as normalized as alcohol, tobacco, and pharmaceuticals, but until then brands need to understand their customers’ motivations and desires and use that information to further education.
Since legalization, we have begun to see an abundance of marijuana dispensaries and other cannabis companies steering away from marketing to the typical stoner, and instead targeting the general consumer by creating lifestyle, luxury, or natural brands.
Marketing to general consumers through education will help attract new consumers who have either ever tried cannabis or have tried it a handful of times. Branding is more important than ever as consumers are looking for trusted sources and reliable products.
Clear educational branding will make it easier for a consumer to identify the products that are right for them based on the type of experience they are looking to achieve, leaving the guesswork behind.
Identifying your target audience
Understanding the consumer goes way beyond how to reach or properly develop content for advertising. It also requires knowing how to market to current and potential consumers—your ideal target market. In the cannabis space, consumers are looking to achieve different outcomes and have preferences in the way that they consume these products.
Using the data that is already available to you, like sales, website visits, and advertisement clicks, helps a brand determine what combination of products fits each type of target customer. Creating these user or buyer personas helps you create a more personalized experience for current and future customers and results in less friction on their path to purchase.
The market has an abundance of cannabis strains; picking the right one can be an overwhelming task. Cannabis is available in many forms, with a lot of focus on tetrahydrocannabinol (THC) and Cannabidiol (CBD), or a combination of both.
A consumer has many options when it comes to their desired form of consumption, i.e., dry flower, concentrate, oil, tinctures, edibles, or hash.
Within those categories, there are over 700 different strain types, and many are still being frequently bred. To make matters more confusing for a new user, the accessories available to consume, store, and grind the product are endless.
Given the abundance of variables and components that go into product creation, a company can benefit from the use of software and data analysis to determine what type of products are profitable and popular among consumers. From there, build out a few buyer personas so you’re able to think in concrete terms about how to develop more effective marketing messaging for each customer segment.
Use measurable digital marketing strategies
There is so much value in brand recognition when consumers are just entering the market. Consumers first entering the cannabis market tend to go to brands and retailers that they have heard of or are familiar with.
The best way to introduce a brand to an in-market or near-market consumer is through digital channels as you can reach a massive audience at scale. Digital marketing lets the business control frequency to ensure that the right consumers are seeing your ads enough times to evoke this recognition when they are at the point of purchase.
The ability to granularly target the appropriate consumer and dynamically provide messaging based on location and consumer attributes provide unrivaled targeting and customization in comparison to other advertising channels. With the ability to target with such precision and accuracy you also obtain the ability to measure the results.
Tying campaign successes to actual results, like store visits or sales, allows you to optimize your media and targeting in real-time. This ensures that you do not overspend on media that is not driving results and that you can continue to move toward efficiencies that help grow your business.
Regularly test and use data analysis for personalization
Your most valuable asset is your customers. Being able to understand what is driving them to purchase is the best way to understand how to obtain new ones. Utilizing first-party data, you can be constantly working to understand and segment your customers into more useful buyer personas. Your goal is to better visualize the attributes that are driving conversion for each subset of your brand (i.e.: frequent purchasers, lapsed customers, loyalty subscribers, Sativa buyers, flower vs. edibles, anxiety vs. sleep apnea, etc.).
Understanding the key attributes and values of your existing customers allows you to build lookalike models to find other consumers that share these same high-value attributes but are not yet visiting your store or buying your brand.
Maintaining and associating purchase and behavioral data on how consumers are interacting with your brand will allow you to create experiences that are tailored to their preferences. You can use this type of data to influence how you present the flow of information on your website, the offers or products you feature, or even the color scheme and content you display.
All of these different components affect the way your brand is perceived and has the ability to make or break your customer acquisition process. Once this system is in place to accurately measure and associate behaviors to different segments and types of people, many businesses are able to get extra value out of the insights.
For example, we see many companies use this data to develop products that align with a customer’s future needs so that as consumer’s habits and tastes change, your company is able to continue to provide products tailored for their needs and interests.
The common consumer is traveling across state lines and experimenting with many types of brands and forms of ingestion, so being able to build brand equity early on during the consumers’ education process is key to building long term loyalty.
This upper funnel targeting tactic is key to building brand equity within an industry in its infancy. Building a reputable national brand takes more than frequently visiting trade shows or purchasing local billboard ads; it requires building a strong voice and being present where your consumers are spending their time—online.
In this day in age where data is unbounded, we are able to track consumers’ digital moves, making it easier to understand and build a brand that speaks to a national audience even when starting off in one state or region. Tapping into the cannabis industry is a huge undertaking on its own; make sure to differentiate and find your audience so you can separate yourself from the masses.