Optimizing Dispensaries: Customer Retention Strategies in the Cannabis Industry

Edge Team

November 22, 2023

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min read

In the rapidly evolving landscape of the cannabis industry, dispensaries are vying not just for market share but for customer loyalty.

As the market expands, customer retention rates emerge as a pivotal factor in a cannabis dispensary’s success. How do you attract potential customers and then keep them coming back for more?

We’ll examine various different customer retention strategies with a spotlight on exceptional customer service. More than ever before, providing customers with an all-around positive experience is absolutely vital in today’s competitive environment.

This holds true for all industries, but as dispensary owners look to cement a foothold in this emerging market, they should know that the key to turning current customers into loyal customers lies in the customer experience.

And what shapes the customer experience more than anything else? Your frontline employees and the service they provide.

The importance of customer retention for dispensaries

The oft-quoted platitude that maintaining existing customers is more cost-effective than acquiring new ones is particularly pertinent in the cannabis sector.

Customer retention is the backbone of a strong, reliable revenue stream and is essential for word-of-mouth marketing (a key driver among cannabis consumers).

More often than not, when customers return, they bring not just revenue but also friends, family, and followers, amplifying a dispensary’s reach organically throughout a local community of potential cannabis customers.

Challenges in cannabis customer retention

Dispensaries often face a unique set of challenges: navigating regulations that can vary from community to community and across states, standing out in a booming market, and meeting the lofty expectations of an increasingly knowledgeable clientele.

The defining factor for retention in this highly competitive space is not the cannabis products themselves but the customer experience.

Every interaction is an opportunity for customer engagement to solidify your customer base and build vital long-term relationships with customers. Conversely, every customer touchpoint is also a risk of driving customers to competitors.

Why customer service is so important for cannabis businesses

When the cannabis connoisseur has a range of local dispensaries to choose from, what is going to make them choose yours over nearby shops? And, if your marketing efforts do get them through the door, what is going to ensure customer satisfaction to encourage them to keep coming back?

It’s the customer service your employees provide. Here’s why:

First impressions matter - In an industry where some customers may be navigating the purchasing process for the first time, Google reviews filled with positive customer service interactions can set the tone for a loyal and happy customer.
Education - Cannabis products can be complex and diverse. Knowledgeable staff can guide customers through the selection process, ensuring they find products that best meet their needs.
Building trust -Trust is essential in the cannabis industry, and customer service is the frontline for establishing a dispensary as a trustworthy and reliable source of cannabis products.
Differentiation - With an increase in competition, dispensaries with superior customer service can distinguish themselves from those with a purely transactional approach.
Encouraging repeat business - Positive customer experiences lead to repeat visits. Since acquiring new customers is more expensive than retaining existing ones, exceptional service is a cost-effective strategy.
Word-of-mouth marketing - Satisfied customers are likely to recommend the dispensary to others, essentially providing a free and credible marketing strategy that can lead to a loyal customer base.

Creating a community - Exceptional customer service helps build a sense of community among customers, which can be particularly powerful in the cannabis industry, where shared experiences and knowledge foster loyalty.
Customer loyalty programs - Effective customer service includes managing loyalty programs that reward repeat business, further encouraging customers to return.

Leveraging technology for enhanced customer service

So, we’ve explored our rationale for why customer service can be such a powerful differentiator for your cannabis shop or cannabis-related business. But how can cannabis retailers like you actually ensure excellent customer service levels?

Incorporating technology like Edge into your dispensary operations can revolutionize customer service.

Edge helps dispensaries collect and analyze Google reviews and customer feedback through various channels. You can then use this feedback to implement new strategies. You can take on board customer insights to create an optimized, tailored customer experience that meets your customers’ expectations.

Automating Google reviews

In the digital age, a cannabis dispensary’s online reputation, cultivated through social media accounts and Google reviews, is a vital component of customer retention.

By automating the collection of Google reviews at the point of sale (POS), dispensaries can effortlessly collate testimonials that reflect the quality of their customer service.

This simple integration into the checkout process encourages satisfied customers to share their positive experiences, which in turn enhances the dispensary’s visibility and trustworthiness online. That can make the difference in terms of initial customer acquisition in an increasingly competitive market.

Positive reviews act as social proof for potential customers, guiding their decisions and generating a sense of reliability.

Further, given that excellent customer service is often the precursor to glowing reviews, there is a virtuous cycle at play: outstanding service leads to positive reviews, which bolster online reputation, thereby attracting and retaining customers.

Edge’s technology plays a crucial role in this cycle, equipping dispensaries with the tools to automatically prompt for reviews post-transaction, ensuring that you can leverage every customer’s positive customer experience.

Motivating employees through reward schemes

Recognizing and rewarding employees for fantastic customer service not only fosters a positive work environment but also ensures that customers receive an unparalleled experience in a competitive landscape.

Edge’s reward schemes are specifically designed to identify and incentivize such high levels of service. By implementing these programs, dispensaries can encourage their staff to go the extra mile for customers, creating memorable interactions that customers are likely to seek out again. This continuous loop of recognition and reward drives them to uphold the highest standards of customer care.

Try Edge as part of your customer retention efforts

As the cannabis and marijuana industry grows, so does the importance of customer retention.

In a market where service can be the differentiator, Edge can be an essential partner for dispensary business owners.

By leveraging Edge, businesses can provide unparalleled customer experiences that not only retain but also inspire loyalty, developing customer relationships through your frontline employees and their interactions at any stage of the customer journey.

Try out the Edge platform and benefit from: