The cannabis industry is one of the fastest-evolving markets today, with 420 standing out as a crucial event for cannabis retailers and brands alike. In the aftermath of this significant date, businesses scramble to analyze their performance, seeking insights that can drive future growth and efficiency. However, without the correct data interrogation techniques, organizations might miss out on the actual story their performance metrics are trying to tell. This article outlines three pivotal data questions every cannabis business should be asking post-420 to truly understand their performance and how to approach data analysis with a strategic lens.

1. What is the Attribution Logic of Your Dispensary Revenue Reporting?

At a glance, revenue figures post-420 might be up, and certain discounts may appear to have driven significant sales. But, how well do you understand the contributing factors? For example, identifying that a specific discount, say "x," generated the most revenue isn’t enough if "x" is an auto-applied discount for all loyalty members. This scenario doesn’t necessarily illustrate demand or an active consumer response to your discounting strategy but rather a skewed representation of revenue attribution.

Consider a more voluntary discount – like "$40 off when you spend $200" – which was utilized 45% of the time against an average order value (AOV) of $100. This suggests that the discount actively encouraged higher spending, contributing to a genuine bump in revenue. Key takeaway? Drill down into your discount strategies to understand which are genuinely moving the needle on your AOV and why.

2. Are You Growing Your Dispensary Customer Base and Your Revenue Per Customer?

Understanding whether your growth is coming from an expanding customer base or increased spending from existing customers is crucial. Both aspects are fundamental, but they require different strategies and understandings. For instance, acquiring a new customer can cost significantly more than retaining an existing one, with figures suggesting anywhere between 4 to 10 times more, or even 30 times according to some sources.

Dispensary retail strategist, Krista Raymer, points out that in new markets, 70% of revenue may come from just 30% of customers. This underscores the importance of aligning initiatives towards nurturing these high-value relationships while also developing strategies to broaden your customer base efficiently. Start by parsing out revenue growth into these two categories to uncover where the low-hanging fruits lie for your business.

3. How Effectively Are You Aligning Initiatives to Support Desired Outcomes?

Finally, evaluating the effectiveness of marketing or operational initiatives cannot be done in a vacuum. For example, a 21% revenue growth might sound impressive, but if 75% of this came from high-cost-to-acquire new customers focused primarily on price, the long-term implications could be less favorable. Understanding not just the immediate but also the projected long-term value of new customers is critical.

By categorizing initiatives based on desired outcomes and associating each with specific, identifiable data markers, businesses can attain a clearer picture of their ROI. This approach enables more informed decision-making regarding where to invest in customer acquisition, retention, and growth efforts.

Actionable Insights

The post-420 analysis offers a treasure trove of insights for cannabis businesses willing to dig deeper than surface-level performance metrics. By asking the right questions about revenue attribution logic, customer base growth versus revenue per customer, and the alignment of initiatives with outcomes, businesses can unlock strategic insights that drive meaningful growth. Going forward:

• Organize marketing and operational initiatives by the outcomes they aim to achieve.
• Always question the logic behind your data—understand what's driving the numbers.
• Prioritize understanding the lifetime value of new versus existing customers.

Understanding your business through a data-driven lens post-420 isn't just about crunching numbers; it's about interpreting those numbers in a way that aligns with your strategic goals. For cannabis industry professionals, especially in highly competitive markets, adopting an analytical, nuanced approach to data is the key to crafting strategies that are not only responsive but also predictive, ensuring that your business isn't just reacting to trends but actively shaping its future.