By Greg James
Changing marijuana laws in Oregon have created a chaotic market for retailers along Washington state’s southern border. When cannabis possession became legal in Oregon on July 1, 2015, retail establishments in border cities like Vancouver, Washington experienced a boom in revenue. But when Oregon lawmakers gave medical dispensaries the go-ahead to sell to all adults three months later, most stores showed steep declines in sales.
While many stores have struggled to regain their foothold among the top retailers in the state, Main Street Marijuana sticks out as an outlier by continuing to grow and thrive.
Brothers Ramsey and Adam Hamide, who own Main Street Marijuana, have obviously been doing something right by running a customer-centric retail store that paid a great deal of attention to the consumer experience. Main Street’s revenue boomed to more than $2 million per month during the three months leading up to Oregon’s recreational roll-out. While sales have dwindled considerably since September 2015, Main Street Marijuana achieved one of its top sales months ever in January 2016 at nearly $1.4 million. It was the second-leading retail store in the state, trailing Uncle Ike’s Pot Shop of Seattle by less than $300.
Ultimately, marijuana retail will be no different than traditional retail businesses, and the winners will adhere to the same principles that have made Costco, Nordstrom and Amazon huge successes. Ramsey Hamide recently spoke with Marijuana Venture about business decisions that have paid off in making his company one of the top cannabis retailers in Washington.
Marijuana Venture: You have maintained and even grown sales at Main Street Marijuana since Oregon legalized recreational marijuana. How did you do that?
Ramsey Hamide: Every decision we make is with our customers’ best interest at heart.
In the early days, we faced a difficult situation where there was not nearly enough product available to supply the demand. When the shelf price to the consumer was over $30 a gram, we were all sick about it, and even closed our doors for several days in protest. As the system has matured and production has increased, we’ve seen a rapid evolution into a consumer-friendly marketplace.
We knew Oregon opening up for recreational sales would have a tremendous impact on our business. We were seeing upwards of 60% of our foot traffic coming from outside of the state of Washington. What we’ve tried to do is offer our customers the best selection at the best prices anywhere in the area, and we feel we’ve done a very good job at that. We pour over the data daily and try to stock the items the customers have the biggest response to at ever lower and lower prices.
Oregon is still limited to only seven grams of marijuana per customer per day, and no edibles or concentrates. We had a specific strategy for October 2015 to highlight our strengths and also Oregon’s weaknesses.
We brought all our prices down 25% across the board, increased our item count to more than 400 menu items with a heavy focus on edibles and concentrates, and we secured large amounts of outdoor that we have been able to sell at prices ranging from $45-65 per half-ounce.
We are very happy and confident in the long-term direction and trend the store is in.
MV: What — if anything — has surprised you about your customers since you opened the store?
RH: I think what has surprised us the most about our customers is just how much everybody loves weed. If you come into our store on any given day, it is a beautiful mix of everyone. Young, old, black, white, blue collar, white collar. It’s your neighbor, it’s you and me.
We sought to change perceptions on how a recreational marijuana shopping experience had to be. We went out to Colorado and visited shops where you had heavy steel doors clinking behind you, machines scanning your ID’s information and small, cramped, dark waiting rooms.
It made you feel like you were doing something wrong by being there, like you were sneaking into a porn store. We knew we wanted to create an open, light, friendly, welcoming environment where the customers could come in and take their time looking around and interacting with the other customers and budtenders. Weed is a very social experience a lot of people share with friends and we wanted the shopping experience to be similar.
MV: Would you call your customers loyal?
RH: For most people, the weed shopping experience is one of habit. Before rec stores came along, most weed buyers would have their go-to ‘guy.’
I remember that some of my weed dealers from the past would be my guy for years at a time. If I trusted the value of the product I was buying and they could make it convenient for me, I had no reason to look anywhere else. We want Main Street to be that guy. We want you to have the same consistently positive experience time and time again at the store. We served more than 10,000 customers last week alone (the first week of February) and many of them are regular faces we recognize from seeing daily. We have a tremendous amount of loyal customers who make us what we are.
MV: What makes them loyal?
RH: Customer loyalty is forged over time. The proof is in the pudding.
Anyone can run a one-day special to increase traffic. The key lies in consistently offering your customers the best prices, selection and service you possibly can while always striving to improve.
MV: How important are brands to customers?
RH: We find that most customers initially buy off of two primary criteria: the highest THC and the lowest price. As they become more regular shoppers at the store they become less THC-dependent and start to buy based off of positive brand association. Our partnerships with Smokey Point Productions and Magic Kitchen (Northwest Cannabis Solutions) have been hugely positive brands for the store and the customer shopping experience.
MV: What mistakes do you see vendors making?
RH: Ultimately this business has come down to being proactive and not reactive, and we see the common thread amongst the most successful companies of listening to what the customers are asking for and responding. Nine out of 10 growers will tell you that they are the only one with the secret sauce. Those preconceived notions of knowing what customers want tend to be harmful. The industry changes fast and we all have to be flexible to change with it.
MV: Are marijuana purchasers price-sensitive?
RH: There is a good portion of our customer base that is very price-sensitive. They gravitate toward whatever the cheapest product we offer is. However, those customers are making up less and less of our overall revenue. As the price range has come down to $6-12 a gram and buyers get more value for their dollar, we see that more people tend to gravitate toward the top-shelf selections.
MV: Are there non-marijuana retailers that you admire, and have you copied any of their practices?
RH: I guess if we were asked to match the ideology of Main Street Marijuana with any other business, it would be Costco. We are a fast-paced, high-volume retail location with the goal of bringing our customers a large selection at the best prices they can possibly find. We are nothing without our customers and think about how to improve their experience with every decision we make.