It’s the holiday season, and getting/keeping your customers engaged is something every dispensary wants, but it’s easier said than done. As your inbox fills up with holiday sales, it’s hard to dispute the higher levels of engagement that come with more targeted SMS messages, which are used to share promotions, discounts and business events.
Text message marketing has effectively boosted digital conversions, enhanced brand loyalty and awareness, and recaptured lost customers. It also:
But dispensaries looking for engagement should know that not all SMS messaging will elicit a purchase from customers, or even a response like a click through. So what kind of messaging does?
We’re looking at the data to see what kind of texts keep your customers from typing out the “S” word: that is, “Stop” to unsubscribe.
More on the data sample:
This data sample is taken from a number of SMS campaigns sent from Sept. 1 to Oct. 31, generated from 50 dispensaries across five states. (Most of of the data is derived from dispensaries in California.)
We measure conversion rates by actual purchases on a 24-hour time scale with last touch attribution- in other words, did someone get a text, and did that push them to purchase within 24 hours of receiving that text?
Top Performing Campaigns
A few top performers: “Deal,” “Promo,” “Save,” “Exclusive”
What They Have In Common: The Value Proposition
This is No. 1 on the list, and it is by far the most important.
It may seem obvious, but it needs to be said: When sending an SMS to your customers, you’re accessing their personal space. So remember to make your customers’ choice to opt in worth their time. Do make an offer that can’t be found in other places. Don’t waste people’s time with unremarkable discounts. Be clear what your discount or deal is, and let customers know it’s exclusive to them, based on their preferences or purchase patterns.
Other contenders: "Rewards," or Direct Links
What They Have In Common: Keeping it Personal
Would you open a generic letter in your mailbox bearing the riveting title, Addressed to Home Owner? The answer is probably not.
The benefit of SMS is making your customers feel like they’re accessing the more personal side of your business, that they’re getting discounts and deals that other consumers don’t know about. When running a promotion, make it known that customers are getting a deal, and when applicable, they can use or earn points for their rewards program.
If you’re running a rewards program, consider sending effective promos/offers for dispensary rewards, like:
New Customer Discounts
VIP Appreciation
Minimum purchase specials
An Integrated Mobile Experience
It’s important to understand that an SMS campaign doesn’t exist in isolation from the rest of your marketing efforts.
Including clickable menu links in your SMS, whether through bit.ly or tiny.url, inches your customers closer to purchase. While the data doesn’t show that adding a link necessarily increases conversion, you can rest assured knowing you’ve made the purchase more convenient for those on the fence.
If you’re going to direct people to your site, make sure your site is responsive, i.e. mobile friendly. This tactic can easily reduce conversion if customers can’t easily navigate your site from their phones. And make sure, above all else, that your deal is compelling enough to guide users to look into your menu.
Mention Your Brands
More successful campaigns are yielded from more specific campaigns. Looking at the skew of popular words by conversion, customers are more often tuned into specific categories of products, unique offers on favorite products (when you know what they like!), specific brands, and select/exclusive language. This 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.
We see the drop in conversion with high urgency language (e.g. don’t miss out, today only), instructions (e.g. codes upon checkout, visit our website), and around delivery (model with lower conversion due to higher opt-out). The more specific, the better.
A General Note: Creating a Sense of Urgency
Dispensaries see varying response rates when it comes to pushing urgency on specific offers, like through “Flash Deals”. Daily Deals, which derive from the same principle, have an effect of training your customers to hold off purchases until deal days come around.
How do you combat this? Don’t consistently run SMS promotions on the same days.
If you’re offering a discount coupon, make it valid for at least a few days. Labor day Weekend and texts about Labor Day Weekend sales clearly performed better than texts just sent on Halloween, and with other supporting factors, we can reasonably correlate higher conversion with deals that are valid for slightly longer periods of time.
Be choosy with the “Buy Now” language, as customers purchase at their convenience, and can get turned off with messaging that feels too rushed.
Low Performing Campaigns
When looking at low performing campaigns, the data tells us that the context around successful and unsuccessful campaigns go beyond the words used in the messaging. For example, although incredibly important in recapturing valuable loss customers, "We Miss You" campaigns will still likely have high opt-out and low net conversion rates. But that’s the cost of doing business. In this instance, we’ll still look at commonly used words in campaigns, but we’ll delve a bit deeper into what those words can tell us about campaigns with low conversion.
A Few Low Performers: “Delivery,” “Delivered,” “Shop”
What They Have in Common…
Delivery businesses have larger opt-in lists because they collect more information via online purchasing. As a result, delivery-only services often have lower on average conversion. If your business is delivery only, don’t be dismayed that your conversion isn’t as high as mixed or retail only models.
Customers also likely know you offer delivery, so optimize the real estate in that SMS with more powerful messaging around the discount.
Other Low Performers: “Code,” “Check,” “Checkout”
Giving your customers too many instructions creates barriers to purchase. Conversion drops a bit around having customers use codes or transfer points at checkout without native enablement.
All in All
Key Takeaway No. 1: Personalize Marketing with Data
This campaign analysis found that mentioning specific brand names and product categories yields higher conversion. 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 have better control over the marketing results needed to sustain their business.
Key Takeaway No. 2: Lost Customer Opportunities
Lost cannabis customers can hold significant value to dispensary revenue. Some of the terms from the low performance sample actually were terms used in campaigns meant to recapture, so conversion is lower. As seen in our campaign study, lost customers averaged a ticket size of $115.58, so sending follow up campaigns is still worth it.
Happy Cabbage Analyticsprovides data analytics and insights solutions for cannabis retailers. Learn more about their latest platform for delivery businesses, Sirius.