why cannabis retailers should embrace text message marketing
Updated: Oct 24, 2019
We are living in an era of perhaps the most drastic evolution in consumer behavior since the advent of the modern economy. The mobile revolution is not a very well kept secret, either. The days of a laborious coupon-search, comparison, or even purchase are a thing of the past. Virtually, every major component of the customer experience has been replicated and optimized for mobile. The cannabis industry, whose consumer demographic are dominated by 21-45-year-olds, has a unique opportunity to take advantage of a tech-savvy customer base. A recent study¹ revealed that 77% of consumers with texting capabilities aged 18-34 are likely to have a positive perception of a company that offers text capability. This revolution has resulted in new channels of B2C communication in the cannabis industry.
The three most significant channels of mobile communication are push notifications, email, and text messaging (SMS). Each of these methods provides a different user experience, cost, and ROI potential. Let's analyze each toe-to-toe to discover which communication platform provides the most value for retailers and growers in the cannabis space.
open rate & time to open
These two metrics are crucial to measuring the success of any type of B2C communication. Open rate refers to the percentage of communications sent by a business is actually seen by the intended recipient. Any campaign, whether an advertisement or birthday wish, can only be as impactful as its’ open rate.
SMS and push notifications have extremely high open rates (97% and 90%, respectively) while email campaigns only receive 20%. By this metric, email is a clear loser, but to distinguish between push notifications and SMS let’s consider another important measure: immediacy. Time to open is how long it takes a recipient to read the text, if at all. If a business values the immediate impact a communication campaign will have, SMS has a slight edge as a recent study has found that 90% of texts are read within 3 minutes.
For many, dispensaries are sacrosanct. A trip to a dispensary provides much more than just medicinal relief and ideally it provides a customer experience that is unmatched in the retail space. The cannabis industry, by and large, prides itself on personalized customer care and sense of commitment to the individual customer.
Nobody likes to feel encroached upon by unwanted promotions on their cell phones. Therefore, a major thing to consider with any mobile communication is the experience of the recipient as the message should seamlessly integrate into the customer’s’ usage patterns. When it comes to ‘UX’, text messaging has an insurmountable advantage over the email and push notifications. Texts are the most popular means of peer-to-peer communication and thus has not been over-saturated with advertisements or promotions. It stands to reason that this easy to use experience is driving positive responses in recent research. For example, a study found that 75% of consumers would like offers sent via text², Email and push notifications are perceived as more “corporate,” distant and impersonal–the antithesis of what you want your cannabis brand to be.
Businesses in the cannabis industry are often frustrated at the inaccessibility to engage with customers due to laws, regulations, and company policies. Popular means of promotion are restricted to cannabis related business so dispensaries are disadvantaged.
For example, Facebook and Google currently do not allow cannabis-related business to run ads on their platform. With these off the table, it can be extremely difficult for a dispensary to build up a big email list or get people to download their app. Once again, SMS-based marketing solves this problem by cutting out the middleman. Dispensaries that texts their clients, as opposed to communications through an intermediary, experience no hassle or resistance. SMS is accessible to all.
Let’s explore costs comparatives for email, push notification, and text communications. Email: While email may initially seem like the cheapest option (we all get email for free, right?), there are some hidden costs to consider. A custom domain, template & design, and Email marketing service provider all add up to unexpectedly high costs.
Push notifications: Push notifications actual delivery may be cheap, but developing the application is not. In order to have a successful communication channel via push notifications, you need to have a functional application. This is no cheap feat for a small business.
SMS: Costs of texting differ depending on your provider. Some providers charge by packages with SMS limits, others charge per text. It’s important to choose an SMS marketing service that optimizes your budget and specific needs. Generally speaking, however, SMS communication provides unmatched bang-for-your-buck impact.
Choosing how to communicate with your customers via mobile is one of the most foundational decisions a dispensary can make in today’s mobile world. This list should provide you a few valuable ways to evaluate the best way for your business to foster a strong digital connection with your patience or customers.
about the author:
Jeffrey Harris, CEO of springbig, is the founder and chairman of one of the largest loyalty marketing firms in the nation, InteQ, providing loyalty marketing and data driven marketing solutions for big box retailers and financial services companies. Prior to founding Inte Q, Harris held various executive positions for S&H Citadel, Inc. a national incentive marketing services firm headquartered outside of Chicago. In 2011, Harris saw an opportunity to provide this same solution for small businesses and by using his expertise in the industry, created springbig. Harris just completed a 20 year run as a member of Vistage, an organization dedicated to improving the effectiveness of CEOs, since 1998. Harris is also heavily involved in charities and currently serves on the board of various local non-profit organizations in Boca Raton, Florida.
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