Beyond the First Puff: Why One-Time Customers Are Hurting Your Dispensary (and What to Do About it)

New customers are a thrill! It's such a rush when you find out someone has walked through your doors for the first time. It's a fantastic opportunity to show them around, answer questions, and get them familiar with your brand.

You could offer them a discount as a new customer. That sounds awesome! But what if they never come back?

The dreaded one-time customer. You know them all too well. They're the people who pop in for a single purchase, lured by a flashy first-time discount, and then vanish like smoke in the wind. It might seem harmless, but trust us, these fleeting visits cost your dispensary more than you think. 

Let's explore the problem of one-time customers and learn how to transform those vanishing visitors into lasting relationships that fuel your dispensary's growth.

The One-Hit Wonder Problem

You're in a great spot when you're cultivating a vibrant dispensary, offering primo products and enticing first-time discounts to attract new customers! You're off and running. Sounds like a winning formula, right? 

On the surface, yes. But there are a few catches.

Profit Drain

Those hefty first-time discounts you advertise? They're eating away at your margins faster than a hungry stoner at a munchies buffet. While attracting new customers is crucial, doing so at the expense of significant profit erosion is unsustainable. 

Loyalty Limbo

One-time customers aren't building any lasting connection with your brand. They walk in, make a purchase (often driven by the discount), and then disappear, never to be seen again. 

No connection translates to no loyalty, leaving them susceptible to competitor offerings or forgetting about your dispensary altogether.

Marketing Mishaps

If you're constantly spending cash to attract customers who aren't sticking around, this is like throwing money into a grinder. The cash is spent, but it yields no long-term benefit. 

Imagine the compounded value of those marketing dollars if they were invested in nurturing existing customers who become repeat buyers and brand advocates. We're striving for long-term customers here.

The High Cost of Low Retention

Numbers Don't Lie

Let's illustrate this issue with some figures to get clear. 

Suppose your dispensary generates a monthly revenue of $300,000. New customers account for 20% of those purchases, translating to $60,000. Let’s say you offer these new customers a hefty 20% first-time discount. The immediate consequence? You're losing a staggering $12,000 right off the bat. That's a significant piece of your revenue vanishing with each one-time customer.

But the financial troubles go beyond the initial discount.
Here's how one-time customers further impact your bottom line.

Profit Margin Squeeze 

Frequent discounting squeezes your profit margins tighter than a perfectly rolled joint. The more you rely on discounts to attract customers, the less profit you earn on each sale. Use discounts strategically.

Discount Dependency

Customers become trained to expect discounts, making them less likely to purchase products at full price. We don’t want our customers to be constantly scouting sales. This creates a vicious cycle where full-price sales become rare, further impacting profitability.

Luckily, we can learn from the big retail players, use some of their insights, and build our cannabis business intelligently.

Learning from Retail Giants 

Walmart Stocks Pop-Tarts Ahead of a Hurricane

Let's take a brief detour and soak up some valuable insights from retail giant Walmart. In 2004, Hurricane Frances was a monster storm that threatened to devastate Florida. 

Just before the storm, Walmart trucks barreled down Interstate 95, loaded with strawberry Pop-Tarts and beer.

But why these items? Why not canned food or propane?

Through sophisticated predictive analytics, Walmart knew that Pop-Tart sales surged seven times their usual rate before a hurricane, and beer became the top-selling item. 

This kind of data-driven insight is pure gold for retailers. It allows them to anticipate customer needs and optimize inventory, even before a monster storm!

But there's a big difference between Walmart's approach and yours, of course. Let's take a look.

While Walmart excels at predicting which products will fly off the shelves, like a leaf in a hurricane, they can't pinpoint individual customers and their specific preferences. 

This individuality is where your dispensary holds an edge.

Building Customer Loyalty Through Data

Unlock Your Edge

Get Personal

Unlike large retail chains like Walmart, you have the unique ability to collect customer-level data through loyalty programs. By implementing a well-designed program, you can track individual purchases and preferences. 

This information gold mine allows you to understand your customer’s unique needs and tailor your offerings to suit them. It will enable you to know what people want before they know they want it.

Predict the Future

Don't rely only on past purchase history. 

Leverage your data to predict future customer value. This metric, known as Customer Lifetime Value (CLV), is a game-changer for your dispensary. By analyzing past purchases and engagement levels, you can estimate the future potential revenue a customer might generate for your store. 

How cool is that?

Tailor Your Approach 

Utilize CLV insights to decide how much effort and resources to invest in each customer. Not all customers are created equal – some have a higher CLV, indicating a more significant potential for long-term loyalty. 

Refine your marketing strategy to focus on nurturing these high-value customers while still providing a positive experience for everyone who walks through your doors.

Remember, repeat customers are earned through a thriving community.

Cultivate a Community

Building customer loyalty goes beyond offering discounts and tracking purchases. It's about creating a sense of community and fostering a space where customers feel valued and engaged. The sense of community is why people return.

Here are some strategies to cultivate a loyal following.

Education is Essential 

Offer free workshops or educational events focused on different cannabis strains, consumption methods, or the science behind cannabinoids. 

Knowledge is power, and empowering your customers builds trust and loyalty. It also shows them that you care about providing value, not just scoring a sale.

Community Building

Don't just be a store – be a destination. 

Host social events, sponsor local activities, or launch a "Customer of the Month" program. These initiatives create a sense of belonging and encourage customers to connect with your brand on a deeper level.

Content Marketing 

Develop a content marketing strategy that goes beyond just promoting products. Share informative blog posts, create engaging social media content, or launch a podcast on cannabis culture and lifestyle. 

Valuable content positions you as an industry expert and keeps your audience tuned in.

Follow-Up Strategy

Implement a robust email or text marketing plan (where legal) to nurture relationships beyond an initial purchase. Provide valuable content, exclusive offers, and personalized recommendations.

Remember, the goal is to keep the conversation going and demonstrate that your dispensary is more than just a place to buy cannabis. It's a knowledgeable spot where friendly budtenders welcome you back and show you what's new.

The Bottom Line

While attracting new customers is undeniably important, loyal repeat customers fuel your dispensary's growth and success. By focusing on building long-term relationships rather than fleeting transactions, you create a loyal base that keeps your business thriving.

The real green in your business is not attained by new customers walking in – it's about creating a genuine experience that fosters lasting connections and keeps customers coming back for more. 

You can predict and influence future customer behavior by leveraging customer data, implementing strategic marketing practices, and fostering a sense of community. 

Pretty soon, transforming one-time tokers into lifelong brand loyalists will be easier than selling pop tarts and beer to people riding out a hurricane.