By Tony C. Dreibus
Scouting out deals during the winter holidays has long been a tradition for Americans seeking bargains on everything from cars to computers to consumer electronics.
Now you can add cannabis to the list.
With recreational marijuana stores in Colorado and Washington opening this year and medical marijuana gaining acceptance in states where it’s legal, retailers and dispensaries that in the past stayed in the shadows are doing what they can to attract customers in search of deals.
And it’s working.
“We had our biggest day yet” on Black Friday, said Cristy Aranguiz, the lead budtender at Cannabis and Glass in Spokane, Washington, which offered a free pipe similar to the one the character Gandalf smoked in the “Lord of the Rings” movies. “We had a ton of new customers come in.”
Marijuana Business Daily spoke to several owners of cannabis companies that had sales on Black Friday – some dubbed it “Green Friday” – for tips on how to craft a successful promotion as the marijuana industry gears up to do it all over again for the December holidays.
Use Social Media and Email Blasts
Businesses of course need to let their regular customers and potential buyers know that they’re having a sale.
But that’s easier said than done in the cannabis industry, as advertising is often restricted by local or state regulations. In Washington State, for example, cannabis businesses aren’t allowed to advertise within 1,000 feet of anywhere children tend to congregate including schools, daycare center, parks or arcades.
Instead of traditional advertising – like newspapers, billboards and TV ads – many business owners are finding ways to promote their sales using social media and email blasts.
The Happy Crop Shoppe in East Wenatchee, Washington, took 25% off some glassware and up to 30% off so-called Christmas packs that contained various items, promoting its sales on Facebook, Twitter and Instagram starting about a week in advance.
Roughly half the people who came to the store were new customers, owner Mark McCants said. Overall, the number of customers was up by about 30% from a normal day, he said.
Since this was his first year with such a sale, McCants said he wasn’t quite sure how often to update his social media pages. He decided to take a conservative approach – the store updated its Facebook page twice a day ahead of the sale this year.
While that strategy paid off, he’ll shoot for three or four promotional updates a day in the future, McCants said.
“We want to be aggressive but not pushy,” McCants said. “If you (update Facebook) in the double digits, then you’re being pushy. We’re trying to find a happy medium. We don’t want to push it down someone’s throat, but we want to get their attention.”
Start Advertising Early
While sales are bringing people in the door for some cannabis businesses, not all promotions work effectively.
Tumbleweeds Health Center in Tucson, Arizona, which certifies patients for medical marijuana, offered a discount on its services starting on Friday morning. Few people took it up on the offer because many were out shopping.
While dispensaries may have been successful, it wasn’t prime time for people to get certified, owner Kim Williams said.
“It was just a really slow day,” she said.
Tumbleweeds will likely offer discounts around the holidays again but “absolutely” will do more advertising through traditional methods and on social media, and try to better time its sales to ensure people aren’t otherwise occupied, Williams said.
“We’ll just advertise earlier next time, and more,” she said.
If you’re gearing up for the Christmas holiday, therefore, you should start mapping out your strategy immediately and begin advertising your sales sooner rather than later. Some businesses even advise launching marketing efforts two weeks in advance.
Work With Vendors on Discounted Items
The Bloom Room dispensary in San Francisco, which has been open for almost two years, had its biggest sales day ever last Friday as holiday deals brought in a large crowd seeking medical marijuana. The key, manager Nathan Roemer said, is to work with vendors to get discounted or lower-cost items that are still of high quality to offer customers.
Wholesale marijuana is expensive and dispensaries often must pass costs on to customers, so working with vendors that may provide discounts on certain items definitely helps, Roemer said.
“Occasionally they hook us up with (less-expensive) product,” he said. “We ask them if they can help us out during the holidays or special events.”
In return, Bloom Room will promote the vendor’s product.
“They see the value in that,” Roemer said. The promotions on Black Friday were so good, in fact, that the company likely won’t do many more holiday promotions this year due to a lack of sale merchandise, he said.
Pick Your Target Market and Focus on Excess Stock
One important step to planning a holiday sale that is often overlooked: determining ahead of time what type of customer you hope to attract.
Some dispensaries and retail stores do better when targeting their regular customers and locals, while others bring in the crowds by catering to visitors and newbies.
The Crop Shoppe’s McCants said while he had a lot of new customers in for Black Friday, he tends to gear his specials toward regular customers. Although it’s not specific to the holidays, McCants said his store has had success with a Sunday special for customers wearing Seattle Seahawks shirts, hats and other gear.
Trent Smith, the manager of Green Dragon Cannabis in Colorado, said the company tends to offer the same specials at the same price in both its Glenwood Springs and Aspen cannabis stores because they’re filled with tourists. But he also tries to hit his regulars.
The stores took out ads in newspapers and did a text-message blast to existing customers, offering cannabis at $30 for an eighth of an ounce that would normally sell for $50 to $80. Marijuana businesses should discount the types of items that will help get rid of excess stock while getting customers in the door, Smith said.
“Whatever you have lots of, put it on special and make it as cheap as you can and still pay the bills,” Smith said.
The strategy worked — the number of people in the store last Friday was comparable to “a good Friday during our busy season,” he said.
‘Test the Waters’
Holidays are a good time to figure out which sales will work in your area. Glenwood Springs’ Green Dragon, which sells both recreational and medical marijuana, discounted its waxes and flowers the day after Thanksgiving.
The store slashed prices for its wax by $15 a gram – a sale so successful that the company may lower the typical price point.
“If we hadn’t done that, we wouldn’t have known” how much people would buy, Smith said. “Black Friday is a good time to test the waters.”
Tony C. Dreibus can be reached at [email protected]