As an ever increasing number of Cannabis 2.0 products (edibles, vape pens, concentrates, and other derivatives) roll out to market and begin hitting retail shelves, the importance of business intelligence and product knowledge in the cannabis sphere has never been more apparent.
Cannabis retailers have already been contending with the difficulty of selling product that often arrives at the retail store sight unseen, or un-smelled to be more accurate. The need for new tools to aid in training staff, informing product buyers, and driving producer decisions about what products are popular continues to grow as the size of the legal market expands.
As the days of zip lock bags full of cannabis recede into memory, buyers and retailers need to find compliant ways to determine what kind of products customers will be drawn to. Relying solely on their suppliers’ product knowledge and business intelligence leaves retailers overly dependent on highly biased information.
Many retailers are already turning to data analytics, as evidenced by the rapid growth of business intelligence providers in the cannabis sphere. Data analytics are a method that complies with the federal marketing regulation that retailers can use to determine customer preferences and buying patterns, letting the retailer maximize the merchandising and limited in-store promotion allowed.
While many of these tools are in early stages of data pooling, the burgeoning retail cannabis space will rapidly bring more data into the pool, which will quickly refine the consumer preference outline we are currently working from.
If you are a cannabis retailer looking to adopt a comprehensive data analytics service, here are some important questions to ask in your search for the right fit:
- How does the product or service determine consumer preference? Can it tell who likes what kind of cannabis?
- How does the product or service help drive buying decisions? Can it compare different products to find value?
- Are these determinations scientifically valid, or are they based on outmoded concepts like indica vs. sativa?
- Who owns the data you generate? Can you access data from other stores on the same platform in return for sharing your own?
These are the types of questions that a good data analytics platform should be able to help answer for you, and the main points to consider when looking for a cannabis-specific business intelligence solution.
One final thing to consider is that many of these advanced services require integration with a modern, cannabis-specific point-of-sale (POS) and inventory management system.
While many cannabis retailers have been using custom-made systems ported over from other industries, these systems are often not able to integrate into the major data analytics systems, leaving them as a data dead end.
When making decisions about what point-of-sale system to adopt, cannabis retailers should ensure that it allows maximum flexibility and operates on a known industry standard, both for plugging into various analytics systems as well as for auditing purposes.
Jaclynn Pehota is retail licensing specialist and principal consultant at Althing Consulting Services. She serves on the Advisory Board for the Association of Canadian Cannabis Retailers (ACCRES).