Considered an Essential Business, Cannabis Sales Surge as Consumers Hunker Down

Shelter-at-home rules have translated to triple-digit jumps in cannabis buying

Cannabis retailers are navigating the coronavirus landscape. - Credit by Weedmaps
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Key insights:

It’s not 4/20 yet, but tell that to cannabis buyers around the country, who have pushed sales of bud, edibles and THC-laced tinctures to historic levels in recent days.

Before the coronavirus pandemic, April 20, 2019, was the high-water mark for legal cannabis sales in the U.S., with consumers spending millions of dollars to celebrate the unofficial weed holiday that has sometimes been compared to Black Friday.

Those records have been shattered, according to anecdotal and data-backed evidence from industry sources who report double- and triple-digit increases in sales from Maryland to Illinois to the Pacific Northwest in the wake of shelter-at-home rules.

“There were massive spikes in the last week,” said Matt Singer, co-founder and CEO of Los Angeles-based delivery platform TOKR, whose business leaped 278% recently and saw cart sizes triple. “People were buying as much weed as they could, and retailers were scrambling to figure out how to navigate this new reality.”

Switching to ‘contactless’ sales

Dispensaries and cannabis brands, while trying to keep up with the unprecedented pace, have been pivoting quickly to delivery, curbside pickup and online ordering to comply with social distancing mandates. They’re experimenting with new marketing approaches, like launching their own podcasts, while offering freebies and touting their stringent safety measures on social media.

Most cannabis-friendly states have included dispensaries in the “essential business” category, along with pharmacies and supermarkets. However, some are allowing only medical sales, not adult-use or so-called “recreational” sales. Regulators in Pennsylvania have grouped medical cannabis providers in with other “life-sustaining” services.

Many state and local officials have relaxed laws to help cannapreneurs hire much-needed staff and, for the first time in some areas, offer “contactless” delivery. New rules are also opening the door for telemedicine (prescriptions without an in-person doctor visit) and increasing purchase limits.

Weedmaps, an online cannabis directory, logged more orders on March 20 than at any other point in its history, accounting for a 236% spike over April 20 in 2019, previously the industry’s biggest buying day.

Weedmaps

There’s been a 74% increase in unique users on the digital platform in March, compared to February, with the weekend of Mar. 20 showing a 191% increase in orders over the previous weekend. There was a 207% leap in orders for the week of March 16 compared to the previous week, according to the company’s data.

Weedmaps has developed a state-by-state cannabis index so consumers can find out which dispensaries are operating in their area and how they can buy product.

A new green rush, fueled by coronavirus

The coronavirus-driven green rush has meant more sales overall and bigger hauls for individual buyers.

Average pre-pandemic orders at the startup TOKR were already above the industry norm, Singer says, at $121 (versus the typical $85). Those numbers increased to $285 in mid-March, he says, and that’s before a single customer in Beverly Hills busted the curve, buying $1,200 worth of Papa & Barkley tinctures in one day.

From a product perspective, Singer and others have seen significant jumps in edible sales, while flower remains the most popular item. Vapes, already mired in controversy and lagging in sales, have taken another hit, possibly because of the respiratory ailments associated with COVID-19.

A dispensary called 99 High Tide in the tony Malibu section of L.A. has logged two to three times its normal traffic since work-from-home and other social distancing directives have been in place.

99 High Tide

“We had our biggest week ever with hundreds of people a day, online ordering was constant and our phones were ringing off the hook,” said Yvonne DeLaRosa Green, CEO and co-founder of 99 High Tide. “We’re still getting new clients every day.”

The retailer, which had bulked up its supplies in anticipation of the crisis, put safety precautions in place (customers had to stand 8 feet apart, and the location was sanitized frequently) while encouraging its shoppers to opt for delivery. Owners added online consultations, accelerated a website revamp and bulked up their social media presence, using in-house cannabis consultants, called Mermaids, as their education and influencer front line.

In addition to producing daily videos for its site, 99 High Tide will debut its own podcast with thought leaders, said Sam Boyer, CMO. The dispensary, the only business of its kind in the high-rent celebrity haven, will also increase its informational blog postings and work with digital media companies to spread its message.


@TLStanleyLA tlstanley8@yahoo.com T.L. Stanley is a senior editor at Adweek, where she specializes in consumer trends, cannabis marketing, meat alternatives, pop culture, challenger brands and creativity.
Publish date: April 1, 2020 https://dev.adweek.com/brand-marketing/considered-an-essential-business-cannabis-sales-surge-as-consumers-hunker-down/ © 2020 Adweek, LLC. - All Rights Reserved and NOT FOR REPRINT