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Loyalty Programs: A Strategy for Success and Customer Retention

Happy Dispensary Customer

With the cannabis industry growing more competitive all the time, it’s more important than ever for you to stand out from the crowd. Innovative branding and inventory are only two elements of a successful cannabis business.

Does your dispensary have a loyalty program? If so, when was the last time you looked at it? Are you getting the most engagement, or is consumer attention directed elsewhere?

How can you ensure customer retention?

Steering Your Customers Away From the Competition

woman enjoying marijuana

According to a study cited by the Harvard Business Review, loyalty programs increase profitability, but they are most effective when targeted toward existing customers who might be especially vulnerable to your competition.

When strategizing how to retain customers, one important factor for you to consider is a physical location. How close are your nearest competitors? And how can you ensure that your customers don’t become theirs?

The answer might lie in the appeal of your loyalty program.

Two Types of Loyal Customers

The Harvard study goes on to categorize loyalty-driven customers into consolidators and upgraders.


The first type of customer is primarily motivated by convenience. When they pledge loyalty to one retailer, they abandon the others and purchase all of their products at one store.

A challenge with consolidators is to get them into the store for more customer visits; reward points can be a good incentive.


budtender customer interaction

The second type of customer enjoys high-end, luxury items, and can be persuaded to buy expensive items. You can target these loyalty program members with premium product offers.

(Make sure that you don’t put all your eggs in one basket with your highest-spending customers. Broaden your marketing efforts to include your entire customer base for maximum profitability.)

Both types of these desirable customers have increased their purchases by up to 50 percent after joining a loyalty program. Imagine the possibilities for your dispensary.

The Bottom Line: Dispensary Loyalty Programs Are Essential

We’ve established the importance of customer loyalty programs and your dispensary. But how do you leverage your program for the most effective?

Here at springbig, we’ve been brainstorming the ins and outs of loyalty programs for years. So, we have some ideas for you to engage customers.

1. Feeling Punchy?

One way to drive customer loyalty is with good, old-fashioned punch cards. There’s something satisfying about watching the purchases pile up, knowing that a free product or discounted item is in store after 10 or so visits.

You can also increase the frequency of the reward to encourage customers to make more purchases. Try offering a mini-reward after just a couple of punches.

Virtual punch cards can work just as well as physical ones, and they have the advantage of never getting lost.

2. Stay On-Brand

Cannabis brand advertising. featured

While some customers like to mix things up, you’ll probably notice that many end up buying the same brand of gummies or concentrates at each visit.

Remind your customers about what they’ve bought recently. Then, reward them for their brand loyalty by throwing in a little extra with their purchase. You can specify the offers customers receive so that each person can earn points with each dollar spent to redeem their favorite items.

Brand Loyalty and Your Customers

In a customer loyalty survey conducted by accounting firm KPMG, 66 percent of brand-loyal customers wrote positive product reviews online, and 86 percent of these customers regularly recommended a brand to their network of contacts.

So, what keeps customers coming back to a particular brand? The survey counted seven elements: quality, perceived value, consistency, customer service, shopping experience, selection, and pricing.

Don’t let your customers get low on their favorite brand. springbig’s Autoconnect feature can send timed messages to current customers when it’s time to stock up on their preferred products. That way, their next purchase is never too far away.

3. Get Social

cannabis social media

Build a buzz by running regular contests and giveaways on your social media. This will give your current customer base more incentive to follow your cannabis dispensary online.

Giveaways are a great way to attract new customers – and more business for you.

4. Weed All About It

cannabis product

Everyone likes to be in the know – especially about a good deal. Appeal to your customers’ curiosity by sending out exclusive email newsletters or a text message with news about special discounts, new offers, product announcements, and of course, your customer loyalty program.

Don’t forget to offer refer-a-friend rewards for sharing your message with existing or potential customers.

5. Cultivate Your VIP’s and Encourage Customers

VIP Customers

Roll out the red carpet for your most valued customers by creating a VIP membership program. Let your program members enjoy early access to exclusive deals and rewards.

Springbig can help you build VIP lists to initiate and maintain lasting customer relationships. Our targeted email, text message, and push notifications will help lead them to the sale.

6. Fully Integrate Your Loyalty Program Into All Channels

Business Insider cites Starbucks as one of the most effective multichannel marketers when it comes to the loyalty program.

You can duplicate the company’s success by integrating your rewards program with your mobile app and point-of-sale system, creating a seamless customer experience for your business.

Let your customers have the option to accumulate rewards points through multiple channels, such as online purchases and phone orders.

Give your customers an extra reason to visit your store, and they’ll happily watch their points accumulate.

7. Enlist Influencers and Brand Ambassadors

influencer image

Generation Z and younger millennials tend to be more heavily influenced by social media. They read online reviews and follow influencers to learn about the latest products and trends.

You can incentivize influencers with referral rewards.

Leverage the online awareness of these demographic groups. Spread the word about your loyalty program to cannabis-friendly influencers.

Tips for the Success of Your Loyalty Rewards Program

Now that you’ve learned about strategies for implementing your dispensary loyalty program, here are some strategies for success – and potential pitfalls to avoid.

  • Don’t make things too complicated. A rewards program should be easy to enroll in and engage with. The aforementioned KPMG survey found that 69 percent of millennials were flummoxed by most rewards programs. So, as a first step, you need to make sure your customers access the program.
  • Ensure that your rewards are appealing. Strategize what’s important to your customers. What makes them want to earn points? Keep rewards relevant – if not, the points will go unused, and that benefits no one.
  • Keep your rewards program front and center. Don’t let your customers forget about what makes your dispensary experience rewarding. Make sure your budtenders always remind your customers about rewards whenever they visit the store.
  • Personalize your rewards. Do your customers shop for more flower on Fridays? Maybe you need to send out an upbeat reminder for the weekend. springbig’s Campaign Caddie can help you keep track of all the parameters that affect sales.
  • Balance the new with the tried and true. While your most loyal customers might expect to see the same products marketed to them, surprise them with a new offering once in a while. They might adopt a new favorite.
  • When marketing your loyalty program, use language targeted towards different customer segments. Some of your customers use cannabis to feel festive, while others want to wind down and relax. Hone your marketing message to reach each type of customer.

To Sum Up…

POS Checkout at a Dispensary

Developing an innovative loyalty program can help distinguish you from the competition. Use the techniques outlines above to fine-tune your strategy.

And if you need extra support, springbig is always here to help.

We are the leading loyalty rewards and mobile marketing platform for the cannabis industry.

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