Curiosity may have been game over for the cat, but it’s game on for the cannabis consumer.
In an increasingly competitive market, driving consumer interest in new or seasonal products comes from various approaches and marketing maneuvers, including timely offerings that help keep things fresh and alluring.
With the autumn equinox upon the cannabis industry, introducing new flavors for infused beverages, finding the right menu placement for pumpkin-spiced edibles, or hyping up that new product drop on Green Wednesday (the day before Thanksgiving) could draw in new customers or give experienced shoppers a reason to crossover to new market segments.
But acquiring increased interest levels boils down to “offering unique products that spark the curiosity of new customers and give them a reason to try you out,” Oswaldo Graziani, creative marketing director at Florida-based Fluent, tells Cannabis Business Times.
“Being visible with new product drops and offerings is one of the easiest strategies to deploy,” says Brandon Wiegand, chief operating officer at Las Vegas-based Thrive Cannabis Marketplace.
“Seasonality affects most product categories, but the most substantial impact comes with the edibles category,” says Thomas Winstanley, chief marketing officer at Massachusetts-based Theory Wellness.
Graziani, Wiegand and Winstanley detail the best strategies to acquire new customers, what to expect with seasonal trends, how to capitalize on new products and much more in this exclusive three-tiered Q&A with CBT.
Editor’s note: These interviews have been edited for style, length and clarity
Courtesy of Thrive
Tony Lange: What are some of the best strategies to acquire customers when a new product hits the market?
Oswaldo Graziani (Fluent): I believe it’s mostly about offering unique products that spark the curiosity of new customers and give them a reason to try you out. That spark can ignite for many reasons. Branding and messaging are crucial for Fluent, but cannabis users respond primarily to quality, variety and competitive pricing. We work very hard to keep a balance among those. For example, when we partnered with Freedom Town, a local group of legacy growers in Florida, we got a lot of attention from customers who were new customers, not only for Fluent but also new customers for the legal Florida market. In their case, that spark was created by offering legacy flower with unique quality and a compelling story.
Brandon Wiegand (Thrive): Being visible with new product drops and offerings is one of the easiest strategies to deploy. I’ve seen dispensaries pick up a new product and quietly add it to the menu—perhaps they are trying to gauge sales without promotion, but it’s hard to judge product performance if your customers don’t know it’s there. That can get noisy and overbearing if you’ve got a lot of new products cycling in and out of your assortment. The key is knowing your customers and understanding them in a way that allows you to make meaningful and specific recommendations that are relevant to them [based on their preferred market segment].
Thomas Winstanley (Theory): A lot of it comes down to the product itself, as not all products are created equal. Depending on the product launch and rollout scale, there are a few different approaches to bringing attention and customers. First off, re-marketing to buyers of adjacent categories is a powerful tool. It’s an opportunity to introduce consumers to a new SKU that might interest them and relate to their consumption habits. It’s also important to consider where it lands in your portfolio and where you think target buyers will be exposed to it. Depending on the product, different channels like social, menu placement/hierarchy, and point-of-sale can all be influential movers. If the product is interesting enough, using the press to help tell the product story can be effective if it’s something that fills a white space. Most important of all is your staff. Ensure they know the product, have tried it, and can adequately speak to the efficacy and nuance of its differentiation.
TL: Are there any specific consumer trends that fade in or out with each season of the year—or holidays—that you factor into your product launches or marketing efforts?
Graziani (Fluent): As for categories or products, not really. For example, the customer who likes flower will probably like flower regardless of the season. However, cannabis users connect with traditional seasonal marketing initiatives like other industries. Moods, our line of flavored oils, is known for its seasonal releases. Last year we launched two seasonal Moods for the holidays: Reindeer Reefer and Festivus Frost, and customers loved them. We sold out much faster than anticipated. This year we are releasing new seasonal flavors for the fall and repeating the success of the holidays’ Moods. It’s a way to keep things exciting and dynamic.
Wiegand (Thrive): The cannabis space is remarkably consistent. We see some seasonality in traffic, but the baskets tend to look the same. Edibles track closely with other candy holidays (Valentine’s, Easter, Halloween and Christmas). We see [interest in] concentrates spike around 4/20 and 7/10. I’ve seen some very successful product launches around 4/20 and 7/10. Green Wednesday is also an incredibly popular day ripe for product launches due to the significant traffic advantage.
Winstanley (Theory): Seasonality affects most product categories, but the most substantial impact comes with the edibles category. Edibles can provide more flexibility in the taste profiles and have the most overlap with traditional CPG products that follow seasonal lines. We do our best to look at past sales trends and general market interest for seasonal SKU rationalization. This includes reviewing past “seasonal” campaigns to garner insights and how we message. For instance, we launched two seasonal Hi5 Seltzers this summer to align with social behaviors. We debuted a limited run of a spring seasonal Strawberry Margarita seltzer to coincide with Cinco de Mayo and a summer seasonal Blueberry Lemonade to coincide with the 4th of July. Both became the top-selling SKU in the market, and we had very positive consumer feedback. To launch these, we run some level of pre-heat and give our top buyers a glimpse before the general market is notified. It’s a way to show support to those who are loyal before bringing it into the public arena.
TL: What trends did you notice in the summer of 2022? What new product(s), or product type(s), have performed well for your company recently? Why?
Graziani (Fluent): The success of Black, our premium line of high potency oils, has been impressive. We knew we had the best high-potency carts on the market: native terpenes, around 85% potency, and a wide range of unique strains. However, no one expected our private label brand’s massive growth. We tripled the amounts of units sold in less than a year, making Black our most successful oil brand.
Wiegand (Thrive): I don’t know that I would peg these trends to the summer of 2022, but these are the trends I have observed over the last year:
Rosin concentrates are in high demand;Ratio edibles (THC with some ratio of CBD, CBN, CBG, etc.) are popular with customers; andLow-dose edibles and drinks—these appeal to new customers and experienced customers looking to microdose or “session” products.
Winstanley (Theory): A lot is happening now in the product development space. Everything from fast-acting products (not just drinks), affordable product lines, infused/high-testing products, and flavored products; it’s exploding. The beverage market continues to expand as a broader consumer segment starts to try them. Bringing in new and exciting flavors helps keep that portfolio fresh and evolving, so there is always something to try.
Graziani (Fluent): Every successful product is an opportunity to give the customer an incredible experience to create a bond beyond that particular product. We try very hard to present Fluent as the one-stop shop for all your cannabis needs. So, when a product overperforms, we ride the wave by ensuring customers learn about other products that may work for them or enhance their experience by offering cannabis accessories or quick-pick products like prerolls.
Wiegand (Thrive): If a store is seeing a product or product category perform [well], then I would test that product or product category in my store to see if we could produce the same results. Your store may have a different customer base, and you aren’t guaranteed to see the same results. I’d rather figure that out on a small bet rather than go all-in and be stuck with slow moving inventory.
Winstanley (Theory): The easiest data to evaluate performance is the sell-through and margin of a product. If it’s a product that consistently sells out and brings a halo spend, it’s likely overperforming. It’s important to understand the key attributes of those high-performing SKUs to determine the “why” of their performance. If key learnings or elements can be extrapolated and applied to other categories, it’s helpful to know what they are and how to leverage them. Sometimes it’s just a trend with consumers or a short-lived novelty that gives an unsustainable spike. Either way, it’s essential to know how to leverage that performance effectively. Identifying a trend can be advantageous in the R&D of new SKUs, wholesale buying of comparable products, and leveraging communications to educate on a category with growth potential.
TL: If you have a flagship product that performs well year-round, does marketing ever change for that product? Why or why not?
Graziani (Fluent): Marketing is an always-changing industry. Cannabis marketing, even more. Customers are evolving in their knowledge, tastes and preferences, and part of our job is not only to keep up but, at the same time, [to] add value to the conversation. Five years ago, the discussion about terpenes was something only a small group of customers cared about. Today terpenes are an essential part of our messaging for all customers. Fluent Flower is our flagship brand—the No. 1 brand in revenue. Even though the product offering has been similar for the last three years, our marketing has evolved dramatically: from the descriptions, the information, the certificates of analysis and the images.
Wiegand (Thrive): Flagship products don’t need a lot of marketing support in the traditional sense. What can be effective is running aggressive promotions on popular flagship products to help drive traffic.
Winstanley (Theory): Marketing is constantly changing, regardless of seasonality. Our consumers’ preferences are evolving in how they want us to interact with them. We actively listen to understand how best to communicate. At a routine level, we’re constantly trying and testing new methods to engage with our customers. Once we find that something does work, we never overuse it and try only to message when we have something pertinent to share with customers. Marketing systems are living things that constantly need to adapt to the marketplace. We continuously evaluate metrics around performance and let those figures guide our planning.
TL: What do you anticipate for Autumn 2022 in terms of consumer trends or products/product types you hope to target from a profitability standpoint?
Graziani (Fluent): We are getting ready to launch our new brand of drink powders. It’s no secret that beverages are the fastest-growing trend in the cannabis industry, and there are solid reasons for it. The demographics of the cannabis consumer are expanding rapidly, so it’s not only about smoking anymore.
Winstanley (Theory): We continue to be bullish around beverages. As we approach the holiday season with social gatherings (post-COVID), we see a lot of potential continuing around adopting this category since it’s controllable, discreet and an alternative to alcohol. It’s the perfect way for the social consumption of cannabis. We think it will be a big fall for beverages.
TL: How far out does the production team(s) need to work to ensure that certain products hit the market at the right time?
Graziani (Fluent): Timing product releases is an art form. Ultimately, we are growing plants, so it’s never an exact science. The key to our success is constant communication between the cultivation, production, sales and marketing teams. It’s a day-by-day dynamic, where we need to allow flexibility and the capacity to pivot, if necessary, but always with clear goals and numbers.
Wiegand (Thrive): Production in Nevada is extracts, edibles, topicals, etc. It depends on the product (cold cured resin will obviously take longer than a shatter), but a production team can be pretty nimble and adaptable—three to four weeks, depending on packaging. Cultivation is what takes the most time—changes made today aren’t seen for three to four months (or longer) depending on what you are starting with (seed, clone, tissue culture).
Winstanley (Theory): It depends on the product. We have a process in-house that collects stakeholders’ feedback on everything within the chain of creating a product, including packaging, recipe formulation, raw goods, employee testing and distribution. We’ve turned around products and packaging in a few weeks, like our Ukraine Chews, but others, like our Energy Drink, took a few months. No matter how much time you have, it’s guaranteed you’ll want more than you have. We have a product pipeline ranging from three months to two years to shelves.
TL: Does your company’s cultivation team plan grow cycles for certain cultivars to hit the market during certain times of the year (like a winter strain vs. summer strain), or is that not really a thing?
Graziani (Fluent): Our cultivation team prepares for seasonality. The dynamics of growing flower in Florida change dramatically over the summer. However, when it comes to marketing, we focus on a marketing calendar of events (4/20 or Green Wednesday, for example) more than the seasonal cultivation calendar. In the near future, we envision having seasonal strains as our cultivation expands and diversifies.
Wiegand (Thrive): We have not seen a significant change in strains by season. You may see a slight shift in demand for sativas in the summer and indicas in the winter, but not enough to change grow cycles. What we have observed is that there is a fatigue with most strains—if they’ve been on the shelf more than three weeks, there is a steep fall off in sell through, so being able to keep the strain shelf fresh with new options is really important. The exceptions to this are really popular, flagship strains that sell all day, every day. Those are pretty easy to identify in the sales data, and the goal with those items is to just stay in stock.
Winstanley (Theory): It’s something we’re aware of but not necessarily planning around. Our outdoor seasons have some bearing on the approach to the seasonality and strains we’re choosing, but that’s more due to finding the balance of outdoor cultivation in the Northeast. However, we do consider the types and flavors to ensure we have a well-rounded offering of palettes and aromas based on consumer feedback. We’re always looking at new genetics and running some pheno hunts based on key metrics for yields, testing, sell-through and general market feedback.
TL: What are some common pitfalls—or things to be keep in mind—in case a cannabis business overplays a product for its seasonal appeal and that product doesn’t end up working out?
Graziani (Fluent): Timing is crucial for seasonal releases. A lot of the seasonal initiatives die when timing becomes a problem. For example, if we plan a seasonal drop for the Christmas holidays, a delay until January would be unacceptable and a total failure. Another challenge is planning the correct number of units for seasonal releases. Making too many is always a problem because it’s almost impossible to move seasonal products once the season is over. You also don’t want to run out of it too fast. Data-driven decisions are always the best way to go, and we are getting better at it every year.
Wiegand (Thrive): I think this comes down to testing—place small orders, read and react to sales, then place subsequent bets or move on to the next one. Don’t get so over your skis on a product that you have to blow it out at a loss just to recoup the cash. By the same stroke, don’t be afraid to bet heavier when you see promising sales results.
Winstanley (Theory): We often assume a product’s success before it’s earned. That can lead to overly ambitious production outputs, which can be timely and costly. When you have pumpkin spice chews in the middle of July because the sell-through wasn’t there in the preceding fall and you have packaging and a surplus inventory—that’s a failure. If you find yourself in that inevitable scenario, ensure there is a robust employee defect or discount program. Creating a new product requires a lot of thoughtfulness to ensure it will be worth the consumer’s time and stand out. While that scenario happens every once in a while, we’ve been fortunate to avoid it with vital production planning, lots of feedback from consumers/employees, and researching trends in the industry and beyond.