Packaging & Branding

Cannabis Brand Loyalty

Tamir Bresler
Written by Tamir Bresler

Why It’s Important to Build

In a highly competitive market overwhelmed with new and established brands, companies employ different tactics to create brand loyalty. Loyal customers will purchase their favorite brand regardless of convenience or price1.In the cannabis market, fostering this feeling is even more important because large brands do not yet exist.

Building brand loyalty in general is important. Subconsciously, consumers remember feeling associated with a brand even if they do not remember the brand name or advertisement2. For example, within the edibles market, 73% of consumers have a favorite brand. Once they find it, they’re extremely loyal, with 60% of these consumers choosing that brand at least 75% of the time3.

A survey of more than 400 medical marijuana patients in California revealed some important branding trends4. Cannabis consumers, in a slight salute to their counterculture past, do not admit to being influenced by advertising or marketing techniques.Meanwhile, nearly half of those surveyed are hesitant to purchase a cannabis brand they have never heard of. Between 60-70% of those surveyed said that they are loyal to their brands, though they did not state the reasons. It could be because of perceptions of superior quality, flavor, or availability. Loyal consumers are willing to pay more and travel farther to get the brands they trust.

Frequent users—those that smoke more than five times a day—are among the most loyal cannabis consumers. These users more strongly agreed with all loyalty statements in the survey they took compared with less frequent users. Frequent consumers also made up over 70% of the cannabis purchases reported among all users over a given two-week period, making them the most important consumer group in terms of marketing. This makes them not only the most loyal, but also the customers who generate the most revenue for the brands they love.

Of the occasional cannabis users (those who consumer cannabis 1-3 times per month), nearly half first look at price when considering a new brand. Conversely, only about one quarter of those who use cannabis daily are first drawn to a new brand by its price.Since daily users and most frequent users do not appear to be highly price sensitive, an important fact that should be inferred from this data is that incremental product price hikes will be unlikely to drive away core business—or deter the arrival of new ones from that consumer group.

Brand loyalty seems to be fostered most with the most frequent users, which makes sense when you consider that they are the demographic that consumes the most cannabis. Using more cannabis means more times using the product, and the more you use a product the more time you have to form an impression of it.

That’s why in any successful cannabis product, consistently delivering high-quality is key. That will help your brand generate free “buzz” in the form of word-of-mouth conversation. The survey indicated that among women, it is common to decide on a new brand of marijuana to try based upon the recommendations of friends, sales people or family members. In fact, 43% of women surveyed indicated this as one of the first things that draws them to a new brand, making these recommendations one of the greatest factors influencing their decisions. Delivering top-notch quality consistently will drive this demographic to your brand.

Of course, there’s more to branding then just demographics. But understanding why building brand loyalty is important, and to whom, is the first step in fostering it in your clients. Next time you are at a grocery store, consider which brands you are loyal to. What do they have in common? What drives you to them? And see if you develop some of those feelings for your favorite cannabis brands as legalization continues to grow.

References

  1. https://www.investopedia.com/terms/b/brand-loyalty.asp
  2. https://appliedpsychologydegree.usc.edu/resources/infographics/psychology-behind-developing-brand-loyalty
  3. https://www.brightfieldgroup.com/post/the-potential-of-brand-loyalty
  4. https://www.brightfieldgroup.com/post/consumer-loyalty-in-cannabis-patients-top-five-takeaways

About the author

Tamir Bresler

Tamir Bresler

Tamir Bresler immigrated to Washington State from Israel at age 12. He earned his B.S. in Biochemistry from Western Washington University, and spent several years working the Biotech field in San Diego. Tamir has direct, hands-on experience working as a Scientist in the Cannabis industry. He loves to travel with his wife and dog Fluffy, and also has a great radio voice.

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