Benefits of Cannabis eCommerce: Why Dispensaries and Retailers Need an Online Store

Treez Team

The growth of eCommerce has been prominent across industries and cannabis is no different.

With the cannabis market growing steadily, so is consumer demand. And this demand is leading to cannabis dispensaries and retailers thinking about taking their business online to meet consumer preferences.

But isn’t having a dispensary in a good location or setting retail outlets at multiple locations enough to serve the increasing demand for cannabis products?

In this article, we’re going to share a few reasons why it’s time to embrace cannabis eCommerce. We will also cover how cannabis dispensaries and retailers should choose a provider to take their business online.

What is cannabis eCommerce?

Cannabis eCommerce refers to dispensaries and retailers setting up an online store to sell cannabis products and related services. This gives consumers the ability to browse through products and place an order for what they need without having to visit the dispensary or retail location physically. Customers can pick up their order with curbside pickup or as an express order inside the store at their convenience. Some retailers also serve customers through delivery models, where cannabis products are driven to customers’ doorsteps within a few hours of the purchase.

Why should dispensaries and retailers start a cannabis eCommerce website?

Let’s take a look at some of the reasons why cannabis eCommerce is here to stay:

1. Shopping has moved online

Even though the purchase of cannabis products can be very personal and some consumers may still choose to visit physical locations to make the purchase, it is important to note that shopping has majorly moved online.

As per statistics, the health and wellness industry has been growing at an average rate of 9.9%, and is expected to reach $7 trillion by 2025. It is also important to note that with the increased adoption of eCommerce by dispensaries and cannabis retailers, the legal cannabis and marijuana market is estimated to reach $80.1 billion by 2031.

The numbers are indicative of the increasing preference to shop online for health and wellness products, which also includes cannabis and marijuana.

2. Increases business visibility

Setting up an online store for your cannabis dispensary or retail location can also help boost its visibility. With more than 68% of shopping journeys starting from the search engine, it’s important for cannabis businesses to get discovered when and where consumers are exploring their interest and intent. This helps increase the visibility of your cannabis business if you focus on search engine optimization (SEO) to meet the search intent of your target audience (we will cover cannabis SEO in detail in our upcoming blogs).

3. Improves cannabis product discovery

While the budtenders at physical dispensary and retail locations help consumers understand different cannabis products, getting them to explore everything available with you can be challenging. With cannabis eCommerce, you get to let consumers explore the products available on your online store at their own pace. By displaying different collections, products and services, it makes visitors aware of what your cannabis business has to offer.

4. Enables easy consumer education

Apart from the ease of product discovery, online stores also help with educating cannabis consumers. By setting up product pages in the right way, a cannabis business can detail out the ingredients, benefits, usage and FAQs around each product. So even if the consumer forgets to ask about certain details at the physical location, they have access to all the information on the online store.

5. Gathers consumer information

Even though there are now restrictions on the use of cookies, cannabis eCommerce enables businesses to seek permission to gather consumer information. If a consumer is genuinely interested in purchasing cannabis products, the online store site helps capture their intent and interest. By setting up tracking, you can look into where consumers are coming from to the site, their browsing habits, which products tend to be searched for and clicked on the most, and so on.

6. Enables communication at scale

While budtenders have all the answers to consumer questions, some of them are best suited to be answered by specialists - for example, medical experts. And then, there is the importance of timeliness in replying to their questions and concerns. With eCommerce websites, cannabis businesses can set up interfaces like contact forms and live chat to communicate with interested buyers. They can even automate answers to repetitive queries to offer a quick turnaround time in helping them make informed purchase decisions.

7. Offers convenient shopping options

Cannabis eCommerce does more than just easing product discovery and educating customers. It also helps businesses set up and offer convenient shopping options like ordering online, pay online and pick up at the store, pay online and schedule delivery, and so on. The ease of shopping encourages consumers to buy more, leading to higher average order values and hence profits even in a saturated market.

It is also important to note that consumers are more likely to support businesses that offer contactless shopping and payment options.

8. Age-gating and compliance

Physical dispensary and retail locations do have restrictions in place to meet age-gating and compliance requirements. But some markets often see pushback, making it challenging for budtenders to impose the rules. With cannabis eCommerce, you can set age restrictions to who has access to your website.

Apart from being able to meet a compliance requirement, it also helps cannabis businesses show they’re committed to not exposing cannabis to minors or illegal markets. Businesses can also set purchase limits based on legal rules to meet with state or province regulations on selling cannabis products online.

9. Ability to run offers

Cannabis dispensaries and retail outlets do offer discounts and deals on their products. But at the same time, having an online store can help run promotions at scale. For example, you can offer different deals to visitors from different locations, making the benefits more personalized and attuned with their purchase preferences. With cannabis eCommerce platforms, it also becomes easy to manage these offers and evaluate what performs better in different audience markets.

10. Expand and explore markets

Unlike physical locations, setting up an online store for your cannabis business can also help expand to other markets. With an online store website, cannabis dispensaries can explore different demographic markets to evaluate consumer demand. This helps them analyze the market potential for their products without having to invest heavily into setting up physical dispensaries and retail outlets.

In conclusion

With more states, provinces and territories accepting regular use of cannabis products across different use cases, the market is expected to grow rapidly. This makes it even more important for dispensaries to embrace cannabis eCommerce to meet the changing and increasing consumer demands, and expectations.

In our next post, we will deep-dive into how to choose the right eCommerce platform for your cannabis business.

Don’t forget to subscribe to our blog for more updates.

But if you want to speak with an expert to kickstart your cannabis eCommerce journey, reach out to us today.

Frequently asked questions about cannabis eCommerce

What cannabis products can you sell online?

Some of the leading products to sell online include cannabis flower, cannabis pre rolls, cannabis vape cartridges, cannabis oils, cannabis beauty and skincare products, cannabis beverages, cannabis chocolates, cannabis gummies, cannabis health supplements for humans and pets.

Is it legal to sell cannabis online?

Yes, dispensaries and retailers can set up an online store to sell online. But because cannabis products are still federally restricted, sales of products containing THC must not cross state lines. Most credit card companies and banks don’t allow for online payment of orders. This requires the cannabis business to set up a POS system like Treez to be able to accept cashless payments for orders.

Do you need a cannabis license to sell online?

Yes, similar to how dispensaries and retail outlets work, you will need to get a license for your business before you start selling online. The license you have to apply for is based on the demographics you intend selling to - states, territories or even countries.