Starbucks & Cannabis? A Dispensary Case Study

Brandon Quan | Founder

Published: May 10, 2023

What’s going on everyone? Brandon Beckett it again with another video. And this one is a Starbucks case study specifically for dispensaries. Now, why Starbucks case study? Well, Starbucks is one of the most successful coffee shop chains in the entire world, if not the most successful chain. They got 30,000 stores across the globe with a total market cap of $130 billion.

Now, uh, there’s tons of similarities to cannabis stores that I’m seeing and I’m going to describe in the rest of this video. Uh, but I really wanted to go through this and I really want to paint a picture of how big Starbucks is compared to the legal cannabis industry. Right? Um, I don’t know how we can quantify the entire cannabis industry, both legal and illegal, but in the legal space, you can see that the market cap is only about 16.7 billion.

So Starbucks as a entity in itself is almost seven times bigger than the entire legal cannabis industry. Now, the reason why we’re gonna go through and talk about Starbucks and talk about what they have done to become so successful is because we can take the learnings from a more mature industry and then apply it to our own stores so that we can then conquer the entire world, defeat all of our competition, while at least the ones watching this video, um, and move on forward.

So what can we learn from Starbucks? Now, despite the immense competition, Starbucks has done an amazing job at dominating the coffee store market. So we’re gonna dive into a few things. Uh, there are a lot of things that they do, uh, but these are the main things that I think apply to your, uh, dispensaries and the stores in general.

So the first one is personalized customer experience, right? Whenever you walk in, uh, the baristas, uh, remember customers names, they get the name, they get the order, and when they write the name down on the cup, it helps them remember, uh, regular customers. So if you know that John or Mark or Mike or Sarah or whoever it is comes into the store, um, and they write down their name all the time, this continually helps develop that sort of, uh, comfort or uh, that relatability between person to person versus just a transaction in, in of itself, right? The second one, comfortable in-store environment.

Now, Starbucks has created a comfortable and welcoming store environment that encourages customers to linger and socialize, right? This has helped create a sense of community among customers and led to increased sales as customers stay longer and order more items. Now, if you don’t have the real estate to create a full on lounge like Starbucks, right? Um, these kind of principles still apply.

And what I mean by that is I had a chat with the dispensary owner Yeah, just yesterday, right? Opened up a new dispensary and initially, uh, he thought that the customer demographic was going to be a younger crowd, right? But, uh, but uh, taking my, some of my advice into consideration, he did a survey of his customers and he actually realized that most of his customers are between 40 and 50, which actually makes sense, right? Like I said, this is still, uh, an immature market.

So you’re still gonna have, uh, kind of like the black market, the gray market types of sellers, which typically cater towards the younger people who are willing to take on that sort of, I don’t know, quote unquote risk if you will, right? But what this tells us is that we now need to build an in-store environment that caters to 40 and 50 year olds, right? Or caters to the demographic.

You may have a younger demographic, but in general, I’m just using this as a specific example, right? And what he realized is that, okay, we can’t necessarily gear our in-store environment towards a younger crowd. It is now geared towards an older crowd, at least at this point in time. So picture yourself as a 40 and 50 year old, or if you are already a 40 and 50 year old, what type of store do you want to purchase in, right? I’ve seen way too many stores with the blackout windows, with the security guard in front, just checking IDs.

You go in, you have no clue what’s going on and one person at the cashier desk, and that’s about it, right? What you need to do is now create a more welcoming store environment so that people keep coming back more and more and more. Right? Next one, efficient service. Starbucks is also focused on providing efficient service with streamlined ordering and payment systems that help reduce wait times, right? This has helped improve overall customer experience and led to increased sales as customers are more likely to return if they have a positive experience, ah, who would’ve thought? So similarly to uh, dispensaries, you have like the kiosks where people can order and things like that.

Starbucks has streamlined the service where you can order ahead of time and pick up, um, what a lot of people like aside from a good quality product is the good buying experience. And a good qu a buying experience ties into how do you make people wait less time for the thing that they want, right? Um, and by providing efficient service, this is how you’re gonna get more people to come in through the door.

Cuz if it takes, uh, your dispensary half the time, it takes another dispensary to provide the same exact product or a relatively same product, uh, that you were going to win out on that battle for sure. Now, emphasis on quality. Starbucks has had a strong emphasis on quality, at least when they first started Starbucks was the bigger like, hey, uh, we sell coffee and it is a higher quality, right? But now there are a lot of other coffee, uh, coffee shops that I think have elevated their coffee game.

But again, this is how they started, right? Because it was always just like your regular, you know, dunking Donuts, Sonic Tim Horton’s, um, subway coffee, excuse me, but there was no other, um, brand out there or big chain that focused on a high quality, uh, product, uh, of coffee, right? So they’re able to provide high quality products.

Cuz as you’ll see, people are willing to pay for good quality product, good service, um, and will pay a premium for that, right? So overall Starbucks focus on customer service and hospitality has helped them differentiate themselves from the competition and generate more sales by providing a personalized experience, creating a welcoming store environment and offering efficient service and emphasizing quality.

Starbucks has been able to build a strong brand identity and loyal customer base. Now, how do we apply these strategies to your own dispensary? So, uh, like I said, uh, we’re just gonna focus on these four main things. We have personalized customer experience, comfortable store environment, efficient service, and emphasis on quality, right? So similarly to, uh, the practices that I preach, uh, we’re gonna go and touch on each of these subjects and see, um, how we can apply this to your own dispensary and what better place to do it than looking at Google reviews of other dispensaries because like I said before, when you look at Google reviews, you are seeing a polarized emot.

You’re seeing customers being polarized emotionally, meaning that they’re gonna give you a one star or they’re gonna give you a five star, right? They’re gonna be super happy or they’re gonna be super pissed, right? They’re very rarely, uh, is any in between. Like, you’ll very rarely see any three stars, right? Sometimes you’ll see four stars, sometimes you’ll see two stars, but very rarely three stars.

I might have a three star example in this video, but you get the point. Um, and what we do is that when we find things, when we find things that customers like, we do more of it. When we find customers hate, we do less of it, right? And the cool thing about, you know, this kind of a polarizing emotion is that the thing that makes your customers really like your business is also the things that your customers hate about your business as well.

So I’m gonna walk through that. So you can see here from Christina, uh, very clean, very clean, great atmosphere. The staff was welcoming from walking in the store to getting checked out. I was assisted by Taylor and she did a great job of making me feel like I got what I was looking for at an amazing price.

So like I said, I preach good quality product, good customer service, good buying experience, and good pricing, and all of these things were listed here. Check the boxes, boom, five stars, good to go. She’s probably gonna come back, right? Uh, from Goss, first of all, I think his name was D, right? So again, name dropping the Budd tenders.

Now I don’t, not sure if you’re aware of this, but your Budd tenders probably have more power in your dispensary than you actually think. Aside from having good product and a good product selection, your bud tenders are probably the next most important thing because these people are the ones that are transacting with your actual customers, right? If you generally have the same products across the board, what is the thing that’s gonna differentiate a customer liking their experience and not liking their experience? And in 90% of the cases, it is the bud tenders that are servicing the customer themselves, right? So we could see here that without D 2.5 stars, but he made the difference, right? Even though this person was different, disappointed with the flour because it was dry, um, the taste was bad and all of this stuff, right? D was able to increase the stars that this customer is going to give, right? Without D 2.5 stars and you can’t give 2.5 stars, so probably would’ve been a two star.

Now we have KW here. Not just bad customer service, horrible and rude prices are whatever. I will pay for a good product, I would pay more for good service. I got pre-rolls, just something fast and ready and it was not very good. Everything said one star isn’t even deserved. What reason? Why do you need to go back? Bad service, not good product.

The only thing that got high was the bill, right? So this is a pretty crazy, this is a pretty crazy, uh, review right here, right? So we can see here that the same thing that all of the customers liked about the business that did five stars and the likelihood that they’re gonna come back is really high, is the same thing that this person also didn’t like as well, right? And you can see here, this person has 83 reviews and 66 photos.

So this person does a lot of reviews for a lot of different businesses, right? Um, but I just, you know, I can’t, uh, just keep telling you this enough, is that you need to properly train your bud tenders because you, a lot of people are just getting, you know, students off the street, I’m gonna pay you 12 bucks an hour or whatever the minimum wage is without proper training, right? But you are gonna get more than your money’s worth if you have good bud tenders that you can rely on, right? You want to get what’s called the eight players in the space.

Now, comfortable store environment, this goes without saying. You wanna make your cu cu customers comfortable. Uh, you can see here Jocelyn, a lot of great selection. Customer service is 10 outta 10, my bud tender. Ross is very knowledgeable and great. The store is clean and has a nice ambiance to it as well.

Again, this location has checked all of the boxes, right? Selection, customer service, bud, tender, knowledgeable store is clean, everything is good, right? Dominique, same thing here, right? All good vibes every time I come with a picture of the store, right? Next one, efficient service. You wanna save the customer time, right? Caitlin Montgomery with little tooth right here.

Um, Greg made her visit so effortless and very personable would definitely come back again. So again, you want to have efficient service where people, well, you, you probably have different buckets of customers. Customers that like don’t really know what they’re buying. They come and they ask a bunch of questions and then the other customers that know exactly what they want, right? You want to play on those two buyer personas and you want to ensure that you get people, uh, that you can service right away.

And then you get people that you can educate as well. Now, Emily PSOs are such great vibe, Ross again, name Ross is doing a very good job. Hope they give this guy Ross a, uh, a raise. Um, Ross was an amazing bud tender, made my decision making swift and easy. The place is very well kept and they always take care of the locals, right? When you save people time, right? Saving people time, uh, you will exponentially increase their experience in terms of how well they view your business, right? Just like how Uber, uh, reduce the need for calling taxis, just like how Netflix reduce the need of um, going to Blockbuster, all of these different things.

If you can save people time, you save people or you give people a much better buying experience next month, emphasis on quality, right? So I put both one and five star reviews because I wanna show you that the same way you get five star reviews is the same way you get one star reviews, right? Uh, Darren from Outta town was hoping for something store was nice, right? But after that it was, but after that it was bad.

Paid $80 for a pen that didn’t work. A sig vape is probably stronger than what I got. Truly disappointed, right? I love coming here. I saw Katie, she wast pleasant, knowledgeable, and the product, uh, I will be coming back to see or she hooked up us up with the best product, right? If your product stinks, then it doesn’t matter because your customers are buying the product.

Which is why I want to say that having a good product is very important. Then having the bud tenders is also the second most important thing, right? But they’re like one A and one B, I’m gonna neglect any of that by any means. So very quickly to summarize, right, you want to give people a personalized customer experience.

You wanna make them feel good, you want to create your comfortable store environment, make your make your customers comfortable. You want to have emphasis on quality, providing a good product, and, uh, you want to provide efficient service saving the customer time. Now, the summary of what you need to do in your dispensary, um, is that as you can see, uh, the same things that customers love about your store are the exact same things that they’ll hate about your store, right? Um, and again, to quickly summarize, you want to provide a good personalized customer experience, provide a comfortable store environment, provide efficient service, and also provide emphasis on quality.

Now, above all of this, right? All of this, all of these four things play into what I’m gonna tell you right now, this section right here. Now, a good indicator of a business isn’t how many new customers you get, but how many you can keep in perpetuity. I’m gonna repeat that one more time. A good indicator of a business isn’t how many new customers you get, but how many you can keep in perpetuity because let’s say you want to hit an X number revenue month, uh, store sales a month, right? And you want to cap at this month at this much.

Once you hit a certain number of customers that never leave, you’ll never need to make a new sale ever again with a new customer. Now, this is all theoretical, right? Customer churn will always happen. But thinking from this framework will always help improve your sales because you’re gonna be working on providing your customers with a better experience, right? So if we start at the top right, which is I want to generate as many sales as possible every single day, right? How do you then do that? You get customers to keep on buying and never stop buying.

Because if you can get customers to stop, keep buying, increase the frequency at which they buy and increase the order amount in which they buy, you’re going to make more money. How then do you do that? You provide them a good personalized customer experience. You provide them a comfortable store environment, you provide them efficient service, and then you provide them emphasis on quality.

And how did we get to that? We got to that because Starbucks does this exact same thing. This is how they got to 130 billion. It’s because they provide these four things. Again, they provide a lot of other things, right? But you can see that even if we can take a small, small, small percentage of the strategy that Starbucks has and apply it to our own dispensaries, you’re going to absolutely crush the competition.

I always say that you need to do the very simple things at a world class level, right? So what I’d recommend is you go into any other retail store, whether it’s Starbucks or any anything else, see what you like, see how people purchase, right? How do people act within stores? And then how do you make sure that you curate your dispensary to provide the same exact service? Now that’s it for me.

Uh, just want to quickly summarize. As always, um, if you are looking to double your dispensary sales and you want to get additional insight, you have two options. One, you can download our marketing checklist and guide, or two, you can schedule a free one-on-one with me, uh, for faster results. And then you can get a more custom marketing strategy and we can talk about exactly your situation.

But if you’re just beginning, I’d recommend you download this marketing guide and checklist because I think it’s a very good start on your journey for dominating the cannabis space. Now that’s it for me. Talk to you guys later. Thanks.

Article By

Brandon Quan

About The Author: A digital marketer with over 7 years of experience, Brandon Quan is wildly known as the top marketing expert within the Cannabis Industry.

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