For brands, it’s essential to allocate flower and biomass throughout the post-harvest season to meet retailer demand. Cultivators with outdoor canopy can benefit by preserving enough packaged flower units for the 420 deal season and biomass for pre-rolls during the summer, despite market pressures to process excess flower into distillate during the winter.
Discounts and deals are commonplace across both wholesale and retail transactions during holiday periods. Last year, more than 5,100 retailers purchased discounted products on LeafLink’s platform during the top sales days and LeafLink’s point of sale partners reported about 90% of baskets included a holiday period special. Cannabis retailers and their consumers clearly expect discounts during seasonal times.
For retailers, promotions should aim to increase transactions and, perhaps more importantly, basket sizes. In some markets, especially out West, competitive discounting is promoting a “race to the bottom,” which negatively affects margins and profitability. To counter retail softness during high sales periods, deals can be crafted along customer segments to upsell shoppers: targeted marketing strategies such as sponsored and targeted email marketing, product ads and samples, and trade shows and events can help result in better spend return on investment and higher basket sizes.
For brands, it’s key to create deals for dispensary customers. On average, brands offering seasonal discounts on LeafLink’s marketplace saw a 31% increase in sales and sample requests more than doubled. With dispensaries stocking up on products for holiday periods, brands giving volume-based discounts and customized deals can maintain margins while driving top-line sales.
As the industry navigates strong headwinds in 2023, having the right strategy for seasonal sales will be a key to survival. By avoiding stockouts, presenting buyers the right product assortment, and offering value-add discounts, cannabis companies can thrive in the highest volume times of the year.
Ben Burstein is strategy analyst at LeafLink.