customer loyalty program

Did you know that studies have shown gaining a new customer is actually 5 to 25 times more expensive than retaining an existing one? On top of being cheaper, improving customer retention rates by just 5% has been shown to be able to boost profits up to 95%. But how can you gain more repeat customers? How can you make customers loyal?

Of course, there are the obvious necessities like quality products, exceptional customer service, and unique customer experience. Besides these prerequisites, loyalty rewards programs are the best way to improve customer retention rates and profits at your dispensary.

But not all dispensary loyalty programs are created equal, in fact, many fail. Studies have shown that 53% of consumers have abandoned a loyalty program in the past year. So what makes a loyalty program worth sticking to?

Whether you’re a small business or a multi-state operator, a loyalty program is a must. Here are 5 features every retail dispensary loyalty program needs in order to retain customers and maximize their ROI.


A tiered based loyalty rewards program is an effective and attractive way to encourage customers to stay with you and increase customer engagement. They benefit both you and your customers by encouraging them to remain loyal by offering rewards that are more valuable as a customer visits more often. Tiers heighten your customer’s experience in your dispensary and on top of giving them a sense of belonging, gives them a goal to shoot for.

Integrating tiers into your loyalty program may require some hard work and brainstorming, but rest assured that it’s worth it. In creating a tiered loyalty program, it is important to offer different types of rewards and benefits to your customers. These benefits typically fall into three categories: fixed benefits such as point bonuses and early access to new releases, behavioral triggers from actions such as referrals and social media posts, and additional rewards such as welcome gifts and deals on their birthday. As your customers move up in tier, their benefits will get better while you benefit from their loyalty. It’s a win-win.

2. A Referral Program

What’s better than bringing in customers yourself? Having your loyalty program members bring in more customers for you!

Referral programs are an essential part of successful cannabis dispensaries and can be easily integrated into customer loyalty programs. Referral programs boast the highest ROI of any other form of marketing and customers referred by friends are 25% more profitable, so having one is a must.

In order to maximize your ROI on your referral program, it must be implemented correctly. That means rewarding your customers with meaningful incentives and putting in the work to find influencers to promote your business. You must also commit to being adamant in asking for referrals with each purchase. Want more tips on how to implement a successful referral program into your business strategy? Read our in depth article on dispensary referral programs here!

3. Points Per Dollar Based Structure

Along with tiers and a referral program as a part of your customer loyalty program, it’s essential for it to include a points per dollar based loyalty program. In a points per dollar system, customers earn a 1 point per dollar that they spend at your dispensary, as opposed to visits based sy. According to Fivestars, a traditional industry loyalty program, and our data, point systems encourage your customers to spend more during their visits in order to get their rewards, making them more likely to tack on an extra pre-roll or concentrate to their usual order.

Like with the referral program, an effective points per dollar program requires you to offer enticing rewards to your customers that make it worth it for them to spend the extra $10 per visit. For example, you could offer double points on purchases over $50.

4. Text Message Marketing and Mobile Optimization

Making sure your consumer retention marketing strategy is keeping up with the latest marketing trends is essential to its continued success, which makes text message marketing and mobile optimization a must. Text message marketing is extremely important, especially in the cannabis industry as it’s one of the only ways cannabis dispensaries can reach their customers without running into state and corporate restrictions. It boasts a 98% open rate and according to digital marketing studies, also has a 209% higher response rate than phone, email marketing, or Facebook. While text message marketing is powerful, it can’t be the only change you make to your customer loyalty program.

According to recent studies, 33% percent of those who left a customer loyalty program did so because they felt that it lacked an enjoyable multi-channel experience. That means they want to see the loyalty program exist seamlessly on their laptop and on their phones through emails, texts, and apps. Many customer loyalty programs either fail to utilize the various channels in which they can get content out to their customers, or fail to make these channels seamlessly integrate into one another. What does seamless integration mean? That means if you receive a text saying that you just received 200 points, you can log into your account on the mobile app and see 200 points in your account.

Making sure that your customer loyalty program is up to speed with the latest tech trends is essential to its success, so investing in it to make it seamless across all platforms and including text message marketing in your loyalty program is a must.

5. Automation

If your loyalty program is working that means that your customer base is growing which also means you’ll have to do more communicating. Doing this manually is not very efficient and may cause you to miss customers at opportune times, so you’ll want to make sure the process of rewarding your customers for their loyalty is automated. This way, you make sure that you catch your customers at all the right moments such as after a purchase or on their birthday. With SMS and MMS messaging you can do just that, and with Springbig’s CRM software you can customize exactly what that will look like for you. Whether it’s a weekly newsletter, a thank you message, or alerting your customer that they are close to the next tier of your dispensary’s loyalty program, it can all be set to be automatically sent out through text message.

If you integrate these 5 features into your customer loyalty program, you will gain a much greater understanding of your customer resulting in leaps in customer retention, which will lead to increased revenue and growth for your dispensary.

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