Marketing

Cannabis Companies Should Consider Dispensary Text Message Marketing

Nationwide demand for legal cannabis has driven market momentum to an all-time high in recent years. Despite restrictive licensing and operating regulations, new cannabis products and brands have proliferated in the market, creating a hyper-competitive retail environment for consumer-facing cannabis businesses.

To make matters even more challenging for businesses, federal laws prohibit cannabis brands from directly marketing to consumers. This means that while mainstream brands such as Nike or Apple can target specific consumer demographics with advertisements on social media, legal cannabis companies are not afforded the same luxury and are often forced to use more traditional, and less effective, advertising platforms such as newspaper ads or billboards.   

According to data insights provider Kantar Group, cannabis businesses spent a stunning $719.4 million on newspaper advertisements in 2019, followed by internet display, television and radio ads. Cannabis brands can experience a considerably low return on investment (ROI) on these kinds of ads, especially when over half of legal sales are generated by Millennials. Media studies reveal that while only a third of Millennials have active newspaper or magazine subscriptions, the lowest rate across all demographics, Millennials also stream more online TV content than any other generation. These current advertising practices are both costly and ineffective at engaging target audiences. As cannabis retail continues to migrate to e-commerce platforms due to pandemic-related safety concerns, these advertising strategies will become increasingly obsolete as tech-savvy consumers expect every aspect of their shopping experiences to live online. 

99% of text messages are viewed within 4 minutes of being delivered

Florida-based cannabis CRM and loyalty marketing provider Springbig has recently developed a service that allows brands to partner with retailers and directly market to consumers in a compliant manner. Springbig Brands is the first platform in the cannabis industry that sends brand advertisements to active dispensary customers through text message marketing channels.  

Brands that sign up for this service can upload their own advertising images to a dispensary specific text message marketing portal in partnership with retailers carrying their products. In addition to having full creative control over their marketing assets, brands can also set their own campaign budgets, consumer demographics and consumer reach. Once a dispensary decides to send out a brand’s promotion to its base of active customers, brands will have access to key performance metrics, including the number of customers making a brand purchase, revenue generated from the campaign and the number of total units purchased during the campaign. 

A case study that was conducted during the company’s beta testing phase found that dispensary customers who received sponsored text message ads from Lime, a California-based flower and vape brand, spent over 82% more on Lime products compared to customers who did not receive the ads

While text message marketing has been used since the beginning of the legalization movement, it is still considered one of the most reliable forms of consumer engagement, with studies showing that 99% of text messages are viewed within 4 minutes of being delivered.

A case study that was conducted during the company’s beta testing phase found that dispensary customers who received sponsored text message ads from Lime, a California-based flower and vape brand, spent over 82% more on Lime products compared to customers who did not receive the ads. In total, Lime was able to generate a ROI of 1,713% throughout the duration of the sponsored campaign, which is arguably unheard of through traditional marketing avenues. 

Since rolling out the platform earlier this month, Springbig has signed twelve national and local brands, including Pax Labs, Jetty Extracts, Dixie Brands, Grizzly Peak, Oh Hi Beverages and Coda Signature.

Editorial Staff

The CannaBizCentral Editorial Team is dedicated to providing a professional, unbiased source for legal cannabis business resource news. With over a decade of experience reporting on the latest cannabis news, we’re committed to meeting the high demand for honest, up-to-date information from the nation’s fastest-growing industry - legal cannabis.