Same-day delivery and cannabis might sound like an unlikely pair, but the combination could be the very thing that ends up accelerating cannabis sales to new heights.
When the Canadian government legalized cannabis for recreational use in 2018, the space was subject to heavy and restrictive regulation that led it to trail behind the grey market, which still controls a large share of the total annual sales in Canada.
As the years passed, so did new legislation.
The Canadian government introduced ingestible cannabis products such as gummies and beverages, alongside cannabis concentrate products such as shatter, wax, and other BHO products.
Now, many Canadian provinces, including British Colombia and Ontario, are opening the doors for provincial cannabis stores to include delivery and in-store pickup in their value proposition as a bid to outcompete the grey market for a larger market share, but is the strategy viable?
According to data from retailers and eCommerce-focused companies who have adopted the same-day delivery model, the answer is a resounding yes. Here are three reasons why same-day delivery for cannabis is essential for success.
Why is Same Day Delivery for Cannabis Essential?.
The ongoing COVID-19 pandemic has changed many aspects of daily life. As retail stores shuttered their doors, online shopping and eCommerce rose to popularity as they became one of the only ways for consumers to purchase their goods.
While price and quality are still important factors to consider for purchasing decisions, both are eclipsed by the desire for a great customer experience. It’s so important that 86% of consumers are willing to pay more for it.
But what makes a great customer experience?
Great post-purchase support, prompt answers to product and service questions, and understanding their needs and wants might come to mind, but what forms the crux of great CX is something you might not have ever considered – fulfillment.
Today’s consumers are more technologically savvy than ever before – blending their purchasing and engagement across multiple platforms, touchpoints and channels before, during and after making a purchase.
As IBM writes, customers “are engaging and purchasing across multiple channels and blending their digital and in-store experiences — starting on mobile on their way to work, later, seeing a promotion on social media and buying online, then popping into a store on their way home to pick up their purchase.”
With Uber Eats partnering with Tokyo Smoke to provide Ontario cannabis users with more flexible fulfillment options, it’s clear that demand for the service is already there, and here are the three factors that are driving this shift towards same-day delivery and fulfillment for cannabis.
The pandemic drove consumers online, and while many were unaccustomed or unfamiliar with digital channels, the convenience it offered quickly became an essential part of the shopping experience. With retail opening up again, the accessibility and convenience that eCommerce has offered remains in recent memory and has caused a shift in customer behaviour.
Even where retail has opened in stabilizing markets, consumers continue to shop online. According to a report from Accenture, more than 45% of shoppers in stabilized markets chose to continue making their purchases exclusively online.
Today, an overwhelming 80% of customers already expect to receive their packages within the same day they place them. Another 61% expect their packages in their hands as fast as one to three hours after ordering.
If your cannabis dispensary isn’t offering same-day delivery, you should be prepared to miss out on a large portion of your customers.
While fast and affordable fulfillment forms the core of a great CX experience, not everybody will want to receive their packages at home.
Some may choose to pick up their orders as they return home from work, stopping by the store on their way home to simultaneously pick up their package and check out deals promoted to them through omnichannel marketing efforts. Others may want to leave their workplace during lunch to pick up their order while stretching their legs.
Whatever their reasons may be, businesses must be ready to be as flexible as their customers. Increased fulfillment options such as Buy Online Pick Up in Store (BOPIS), Buy Online Return in Store (BORIS), Clienteling, Ship to Store and Ship from Store can enhance other order fulfillment options such as home delivery and same-day delivery.
Can same-day delivery and same-day pickup for your cannabis dispensary save you money? It can if implemented correctly.
While no business can compete with Amazon’s fleet of delivery drivers or its dense delivery network across multiple countries, they can make use of a strategic asset that’s slowly falling out of vogue – retail stores.
Same-day delivery necessitates the need for a dense network of warehouses and fulfillment centers located strategically to service geographically dense locations, but businesses hoping to capitalize on the same-day opportunity don’t have to invest billions of dollars into ensuring coverage; they can use their existing network of retail stores.
By leveraging their existing store networks, dispensaries can offer flexible fulfillment options and same-day delivery services at a fraction of the cost.
With most dispensaries being located in urban centers, they can make same-day shipping and flexible fulfillment available for a large population in one fell swoop.
Implementing such a strategy wouldn’t just cut your warehousing and inventory costs; it’ll also increase your product visibility and make it easier for customers to discover, identify and engage with your products, wherever they might be.
The hybridization of retail stores as front-facing distribution centers and POS retail has given rise to a new name; the dark store. Large retailers such as Bed, Bath & Beyond, Whole Foods, and Macy’s have already begun experimenting with the concept with great success.
Same Day Delivery for Cannabis - More Than Necessary .
Implementing a same-day delivery strategy for your cannabis dispensary might sound like a costly endeavour, but failing to do so will cause you to lose out much more in the long run. As technology continues to advance forwards, same-day delivery will be standard, and for an industry that’s still losing 40% of its annual sales towards an illegal underground market, same-day delivery could be the catalyst that could make or break the sector.