Exploring the efficacy of celebrity appearances, in-store promotions and special events
Cannabis retailers can expect a big bump in shoppers on 4/20, but the other 364 days of the year they have to get inventive to draw crowds into their brick-and-mortar locations.
Many dispensaries entice additional customers through in-store promotions, ranging from special sales and giveaways to concerts and appearances by celebrities. None of these events can guarantee bottom-line results, especially with strict advertising regulations and increasing competition most dispensaries face, but some outside-the-box thinking can help retailers pull off a successful event.
Celebrity appearances have become a staple of promotional events at cannabis shops, particularly in tourist-packed Las Vegas. Reef Dispensary, for example, regularly has celebrities drop by throughout the year. On April 20, 2018, it had four meet-and-greet events with rap stars.
“We definitely see a spike,” says Mike Pizzo, marketing content manager for Tryke Companies, the parent company of Reef Dispensary and the exclusive producer in Arizona and Nevada of Khalifa’s Kush, the product line promoted by rapper Wiz Khalifa.
Arranging visits from Khalifa and other celebrities can take anywhere from two weeks to two months, depending on how much promotion work the company wants to do.
“The bigger the celeb, the bigger the lead time,” Pizzo says. “Not everyone has the celebrity power Wiz does.”
Costs for visits also vary drastically. Again, the bigger the celebrity, the bigger the price tag. Although you never know when a celebrity might pop in unannounced, most celebrities command $15,000 to $50,000 for a scheduled appearance. Going through an agent to schedule a legend like Snoop Dogg can cost roughly $100,000.
However, cannabis producers who are partnering with a celebrity may be willing to foot the bill for the visit.
“We had Wiz Khalifa and a few others, but we never paid for them,” says Ian Eisenberg, owner of Uncle Ike’s Pot Shop in Seattle. “The celebrities we had were provided by vendors.”
Eisenberg says a few agents have pitched cash-on-arrival, off-the-record arrangements for up to $50,000 to book celebrity appearances at one of his three Seattle stores. Although celebrity appearances can help generate some temporary fanfare, the events come with a downside and can be “detrimental to our core mission of providing the best possible customer service experience,” Eisenberg says.
It’s not hard to imagine the average Joe — perhaps a regular at a place like Uncle Ike’s — being annoyed at having to weave through a horde of fans just to buy a couple pre-rolls.
“We’re not a nightclub,” Eisenberg says.
Start Small or Fail Big
Celebrities have never been part of the marketing plans at The Source, an off-the-Strip cannabis retailer in Las Vegas, chief growth officer Andrew Jolley says, but the company has a full slate of in-store promotions to draw crowds.
“But just like everyone else we’re interested in the buzz and the latest news as it pertains to cannabis,” Jolley says. “We are selective about the promotions that we run, so when we do run promotions, we tend to get a really good response.”
The Source has several reoccurring sales events and standalone promotions throughout the year. The events include vendor days, holiday-themed promotions, anniversary sales, patient and veteran appreciation days and campaigns that help local charities.
While some events have been successful, others have worked a little too well. When the company hosted a canned food drive in 2017, in which customers could receive $2 off a purchase for every can they donated, the results were overwhelming.
“We knew we had a problem when one of our customers showed up with a pickup truck full of cans, about 1,000 cans,” Jolley says. “We ended up collecting 156,000 pounds of food for our local food bank in Southern Nevada. Our goal was 7,000.”
The food drive was a smashing success, but “it was a logistical nightmare,” Jolley says.
Other events, such as the company’s Valentine’s Day and Father’s Day sales have fallen short of expectations.
“We have mechanisms for measuring our promotions and most importantly capturing customer feedback,” Jolley says. “It seems like every month we get a little bit better at providing the types of promotions that our customers actually value.”
According to Dan Zarrella, the director of marketing for The Source, one of those mechanisms is testing the efficacy of the event by starting small.
“I’d rather do testing on a small enough scale that the fallout if it fails isn’t that big,” Zarrella says. “Generally, when we’re blowing something up into a 10-day event, it’s been through testing and we know it works and what to expect out of it.”
Feedback from events can come in a variety of ways: through marked coupons, on social media and during daily transactions with the store’s staff. Having several optimized channels of communication with customers is another mechanism The Source uses to measure the success of its events. It is also the primary way the company advertises them.
Getting the Word Out
Like everything in the cannabis industry, advertising restrictions vary from state to state, so promoting events can be a challenge.
Physical advertisements for an in-store event should start at the store’s location and spread outward. Retail employees who have face-to-face interactions with customers are the first line of marketing for an event. From there, signs and flyers should be posted in the window, on the counter and throughout the store. Contact neighboring businesses to see if they will display the flyer in their window. Many cannabis stores in the Seattle area create coasters advertising the store and give them to local bars and nightclubs.
Digital advertising seems to have two categories: social media and everything else. Although social media may not be the most reliable platform for cannabis companies to reach consumers — due to frequent and random account closures — it’s also one of the easiest ways to advertise in-store promotions. According to Zarrella, in-store promotions advertised on social media should: target the ideal audience; be altered for each platform; clearly denote the promotion on the image and in the description; and feature people.
“It’s called social media because we’re there to interact with people,” he says.
The Source enlists employees to star in the company’s social media posts. Featuring actual employees not only saves the company’s marketing budget for other promotions but also breeds familiarity between the staff and the customers, Zarrella says.
Since many in-store promotions feature a variety of different companies, vendors can be trusted to promote the event through their own channels, he adds.
The same guidelines for social media should apply to the other forms of digital advertising such as web ads, email blasts and text messages: target the correct audience, clearly denote the promotion, be concise and play to the platform’s strengths. Text message alerts have limited character-space available, and oftentimes a lot of that space is devoted to the disclaimers the company is required to include. Emails can contain a plethora of content with few restrictions but can easily be missed or hamstrung by spam filters. Similarly, web ads can be flashy and eye catching, provided that they are not hidden by an ad blocker.
Store owners needn’t settle on a single avenue for promoting events. Zarrella says one of the most important rules for event promotions at The Source is to give the customers the choice of how they would like to be contacted.
“I want to give them every opportunity to select a channel that fits their life style,” he says. “Some people don’t want dispensaries texting them.”