We know by now that customers in cannabis retail stores have come to expect loyalty programs, but how are the results actually stacking up in terms of profit?
Recent data provided by SpringBig is revealing the impact of loyalty programs on cannabis retail store customer traffic.
“Smart campaigns that drive store traffic are the single-most effective method to drive increased sales and positive ROI,” says SpringBig CEO Jeff Harris. SpringBig provides loyalty program technology to the cannabis industry, tapping into the point of sale systems like MJFreeway and Green Bits.
Data offered by three cannabis retailers by SpringBig shows insights into the best strategies that have customers signing up for loyalty programs, and actually ensuring they’re coming back.
Uncle Ikes, a Seattle-based retail chain has found that loyalty customers visit 2.4 times more than non-loyalty customers and spend on average $194 in a 6-month period on cannabis purchases. In addition, they spend $25 more per transaction than non-loyalty members.
“Leveraging behavior-based, trigger-based communication ensures that the right message is getting to the customer at the right time,” says Harris.
Remedy Columbia or Maryland uses SMS messaging to reach their loyalty members and found that loyalty members visit 5x more than non-loyalty programs. They report loyalty members spend an average of $150 more than non-members in a 6-month period while spending $10 more than non-members in a visit.
Las Vegas’ Releaf reported loyalty members spend twice as much, $150 more in a 6-month period, and $10 more per transaction than non-loyalty members.
The key to loyalty programs? “Giving members access to a store or chain’s special offers before the general public sees them while being guaranteed best pricing on all specials,” says Harris.
“Being able to offer bonus points for certain product categories and/or brands provides the member with the ability to purchase certain products and earn additional reward currency that they can redeem for free or at a discounted price,” he further explained.
What should be avoided? Points Per Visit programs, according to Harris. “Awarding points per visit versus per dollar spent does not allow the store to properly manage their loyalty program budget and measure ROI,” he said.