Text marketing is one of the highest-performing marketing channels available to cannabis dispensaries.
Are you currently texting your customers? Maybe you’re planning on it or looking for new campaign tactics to try out.
Whether you’re currently using text messaging or looking to improve your marketing, look at our all-in-one guide below on one of our favorite industry topics.
What is Text Marketing?
Text message marketing for dispensaries is a format of communications that involves sending SMS or MMS communications via consumers’ cellular devices.
This channel has effectively boosted digital conversions, enhanced brand loyalty, and awareness, and recaptured lost customers.
Like most retail industries, cannabis consumers must opt-in to get any dispensary text message.
MMS & SMS
There are two kinds of text messages cannabis retailers can send: MMS and SMS.
MMS (Multimedia-message-service) are texts attached with an image, emoji, video, or website link. SMS (Short-message-service) are essentially plain texts.
Did you know 23% of cannabis retailers sent MMS messages on 420 instead of 77%, which only stuck to SMS?
That meant that nearly a quarter of retailers in our data set chose to include some form of media in their 420 promotions.
The Benefits of Dispensary Texting
Dispensary text marketing provides unprecedented opportunities for cannabis retailers and brands to build a new top revenue channel.
Brands can directly engage mobile shoppers with communications perfectly tailored to where they are in their buyer journey.
Text message marketing:
- Features a 98% open rate and 90% click rate
- Can be accessed from anywhere a phone can go
- Delivers instantaneously and directly
Cannabis Text Marketing & Compliance
Whether you’re already running or planning to cannabis text message campaigns at your store, following compliant practices is critical.
Here are two legal measures you should get familiar with today.
The CAN-SPAM Act is a federally instituted provision regulating electronic communications—such as email and text messages— for B2B and B2C businesses.
The Act penalizes excessive or misleading communications identified as advertisements or content that does not comply with federal law.
A few items in this mandate potentially impact cannabis retailers that want to send marketing texts, mainly those on content and spam.
They pose the most risk for dispensaries sending mass texts or content with many cannabis keywords.
Look at these two steps we’ve discovered through our own clients’ campaign data for marijuana retailers interested in following compliant best practices.
Limiting marijuana text campaign audience size ensures more targeted and less spammy text outreach to customers. Also, did you know that targeted campaigns also produce 3x as much revenue as catch-all blasts?
Establishing audience segments is the best method to limit your audience size. When figuring out how to sort customers, consider product and brand preferences and other key purchasing behaviors to refine your outreach.
10DLC – What's The News?
Application-to-person (A2P) 10DLC is a set of requirements developed by phone carriers to ensure compliance with text message communications. You can find out more about A2P communications on the FCC website, here.
10DLC refers to the term 10-digit long code, such as standard phone numbers.
A2P means 'application to person' or when an application such as a marketing platform sends text content to an individual.
The three major carriers transferring to this system (T-Mobile, Verizon, AT&T) will begin vetting businesses sending text communications for the following violations:
- Text Enablement: prior 10DLC complaints filed against businesses using long-code numbers for communications before the 10DLC program launches.
- Grey Route: Attempting to send A2P messages as P2P (person-to-person) or via another legal channel despite not following compliant guidelines.
- Program Evasion: Attempting to evade regulations imposed by the program (i.e., link-gating, routing, number cycling).
- Content Violation: Sending messages that violate Code of Conduct or SHAFT guidelines.
This is a developing topic with more news to come but let’s clarify some key terms and apply these measures to cannabis retailers. Here are a few key updates we’ve found:
- All T-Mobile fees related to 10DLC are postponed, no longer slated for Oct. 1, 2021 (Twilio – Sept. 30, 2021)
- If you send less than 3,000 messages per day using five or fewer long code numbers, you do not need to do anything currently. (Twilio)
Is Texting Still Possible for Dispensaries?
Yes. However, retailers in this industry must pay close attention to content, avoid cannabis-related keywords at all costs, and strategize highly targeted outreach.
In the next section, we’ll discuss what you can do to improve text message marketing at your business in the upcoming year.
How to Improve Marijuana Text Messaging
From first-hand methods to data-based analyses, we’ve compiled a few resources for taking your campaigns to the next level.
5 Dispensary Text Message Tactics
Our team is constantly gaining new first-hand strategies and data on text message marketing, making cannabis dispensaries more revenue.
Look at these methods below and feel free to try them out at your store.
Minimize Campaign Audience Size
Always send campaigns to segments of less than 5000 customers. Sending smaller campaigns helps maximize revenue per consumer reached.
Align marketing with buyer attributes. This tactic will influence loyalty. Did they order a while ago? Where do they live? What products or brands do they love?
Variety is Key
Consumers become desensitized to redundant messaging. Change up your content regularly to keep your marketing fresh and impactful.
Avoid Cannabis-Related Keywords
These terms can be flagged as spam. So, keywords like ganja, reefer, skunk, grass? Yep, and those are a no-go. Time to get creative!
Allow Opt-Out of Every Campaign
If someone no longer wants your messages, that’s okay. Keep targeting the people that do and always give them a way out.
When Should I Send Texts from my Dispensary?
Thursday, Friday, and Saturday tend to be perfect days for people to purchase cannabis. However, taking a closer look at these timeframes reveals some fascinating insights.
Our research shows that clients usually make cannabis delivery and retail purchase are around 3 p.m. Times also vary by product, with the earliest purchases across the board showing delivery for extracts, while the latest is retail for pre-rolls.
Sending special offers more than four times per week tends to lead to more opt-outs and lower deliverability. Also, be sure to keep your texting diverse (for example, feature an in-store promotion, a holiday message, a deal, or a loyalty program).
Segmenting Cannabis Marketing Audiences: ROI Analysis
How do you identify key cannabis audiences? Does this matter? Yes! Segmenting lost and existing customers is vital to higher engagement.
The goal is to create identifiable subsets within a given market. Using cannabis POS data to target behavioral and demographic attributes like brand loyalty, order size, frequency, and geographic region can impact overall revenue per customer.
The graphic below demonstrates how much revenue per consumer will increase with more advanced levels of text marketing segmentation.
The scale starts with dispensary text blasts at the base and spans into algorithmically targeted marketing campaigns with products like Happy Marketers.
Examples of High-Performing Marijuana Text Message Campaigns
Happy Cabbage analyzed data and methods behind our clientele's most successful campaigns in March 2021. Here are the results of some of the best-performing SMS campaigns.
Highest Conversion Rate in 24 Hours: 14.92%
A dispensary in Los Angeles sent this text out to 21 consumers who opted-in to receive text message marketing. The campaign converted 14.92% of the audience segment in 24 hours and 23.8% after one week.
Why It Worked: Targeting Product Type Affinity
The cannabis dispensary sent SMS campaigns out to audiences segmented by preferred product type.
Targeting buyer affinity to specific product types is an excellent way to personalize marketing text message campaigns and increase ROI instead of catch-all discounts.
Although the segmentation approach is relatively general, it's more likely to bring consumers back into the dispensary because the promotion mirrors the preferred consumption mode.
Highest ROI in 24 Hours: $17,867
This dispensary's SMS campaign went out to 8,882 customers, returning nearly $18,000 in sales within 24 hours.
The targeted consumers responded almost immediately, as most sales attributed to this sms text campaign within the first 24 hours after one week.
Why It Worked: Buying Pattern Segmentation
This campaign targeted different audiences within unique buying behavior segments. Looking at buying patterns, retailers can understand specific nuances in how buyers interface with their storefront.
A few of those behaviors include:
- Average order size
- Average time between orders
- Time since their past order
- How long it takes to complete an order
Highest Customer Recapture Sales in 24 Hours: $1,387
Recapturing lost customers is an essential process to sustaining long-term dispensary revenue. To understand the value in customers that lose interest in a retail location, take the following campaign as an example.
This dispensary sent a campaign to nearly 4000 customers, which prompted 12 lost customers (that didn't order for 90 days or more before the campaign) to make a purchase.
The 24-hour sales from those 12 customers were $1,387, representing an average ticket size of $115.58.
Why It Worked: Hybrid Behavior & Preference Segmentation
While the previous examples show targeting audiences based on buying behavior or product preferences, this campaign combines both targeting methods for greater personalization across niches.
The campaign demonstrates how dispensary SMS marketing delivers impact when used to with machine-learning generated audience segments.
The findings from these three campaigns reveal a few critical takeaways for dispensary marketing teams to consider.
Key Takeaway #1: Personalize Marketing with Data
This campaign analysis found that dispensaries delivering targeted marketing to customer segments produced promising outcomes in terms of conversions, sales, and customer recapture.
Retailers that devote time to defining customer segments– independently or via platforms like Happy Marketers– have better control over the marketing results needed to sustain their business.
Key Takeaway #2: Lost Customer Opportunities
Lost cannabis customers can hold significant value to dispensary revenue. As seen in our campaign study, lost customers averaged a ticket size of $115.58, and that's revenue that could've otherwise gone untapped.
However, marketing is required to recapture and, based on the data, targeted texting campaigns reignite customer interest.
Check out our recent case studies with Lionheart and MMD for more updated results!
Send Smarter & Superior Dispensary Marketing Campaigns
Dispensaries across the United States continue to elevate their text marketing strategies with Happy Marketers and turn texts into a key revenue-driving channel. Book a demo with us to learn more about Happy Marketers today!