• jeffrey harris

Why Your Dispensary's Loyal Customers Deserve VIP Treatment

who doesn’t want to be a VIP?

Do you want to roll out the red carpet for your dispensary’s customers and give them the best experience in town?  Dispensary loyalty programs give customers the VIP treatment that will keep them coming back. 

Your loyal customers deserve to be treated like VIPs because, according to a case study we ran on our clients' loyalty programs, they will account for 90% of your sales over the course of a year! 

So you want to do things that make your dispensary the only one they think of when deciding where to make a purchase. By offering rewards so good, it makes everyone else who walks into your dispensary rewards program as well.

loyalty program members accounted for over 90% of total spending over a year!

applying incentive 

One curious statistic from 2016 shows that 60-80% of customers who described themselves as satisfied did not do more business with the company that satisfied them. That is a baffling discrepancy. Experts are certain it is due to a lack of connection.

Conversely, data shows that 60% of customers who sign-up for a dispensary loyalty program do return to the shop. What this tells us is that using the right incentive can be the difference between closing big sales or closing your doors early.

loyalty improves frequency

How often is often enough, really? In this business, it makes sense to keep your customers visiting as frequently as possible. By providing a VIP experience, you create a compelling reason for customers to keep coming back.

Another case study reveals that loyalty customers visit 43% more often than your average customer! 

That means your budtenders are likely to see a loyal customer at least twice in the time it takes a regular customer to stop by once. As we know, increasing visit frequency easily translates to increased spending over time. By offering exclusive rewards, you can incentivize loyal customers to maintain those visit habits in order to keep earning points.

To that end, springbig gives dispensaries the ability to target customers and reward them based on their visit history. For example, you can reward customers based on how many times they have visited since enrolling in your program. Say you’ve got a regular customer who crosses the 100th visit mark, you can send them a little gift using a ‘visiting total’ segmentation filter. 

Likewise, you can set up an automation rewarding loyalty members who reach multiple visits within a certain period of time using the ‘select date range’ sub-filter. Have loyalty members who visit 5 times in 30 days? Try sending them coupons after that 5th visit, showing them it pays to be consistent.   

loyalty programs are worth it 

When we talk about treating loyalty members like VIPs, one reservation owners may have is making sure the investment is worth the effort. Some are worried that favoring loyal customers may end up losing out on potential revenue from regular customers. But the numbers show this is not the case. 

According to data from Headset, loyalty program members spend an average of 35% more per purchase than regular customers. And they purchase a wider variety of products as well. So even when VIPs are benefiting from coupons and exclusive offers, most are spending more than your typical customers would on their best day. 

One of springbig’s dispensary clients recently shared an internal study revealing that in the month of June 2019:

  • Average ticket price for non-loyalty members was $97

  • $132 was the average ticket with redemptions

  • 146 rewards were redeemed, resulting in transactions totaling $19,477

  • The program also added over 1,500 new members in that month

Needless to say, the investment in the VIP experience is paying off. Not only are their loyalty members spending more than the average customer, but the popularity of their rewards program is showing impressive growth.

improving retention rates

Even if increasing basket size, improving visit frequency, or attracting a better quality of customer don’t quite do it for you, then improving customer retention rates should really make you see why loyalty programs are worth your time. 

Dispensary loyalty programs are the most powerful and cost-effective customer retention strategy when compared to traditional mass advertising campaigns. Statistically speaking, it can be 5-10x more expensive to gain a new customer compared to retaining current customers. Meanwhile, just a 2% increase in customer retention has the same impact on your dispensary as reducing costs by 10%.

To make it even easier, we note that over 50% of people say they are more likely to give a referral to your business if they have access to incentives like a loyalty program. So they are covering some of those advertising costs for new customers for you!

Not only do your VIP customers spend more with your business, but they also save you money! They are one of your most valuable assets as a cannabis retailer, and treating them like the VIPs they are is a simple way to leverage your resources and keep building that relationship. They deserve it because enhancing their experience at your dispensary is the easiest way to make sure you have the opportunity to provide that experience to more people. 

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