As cannabis products continue to gain a presence in consumers’ minds, retail operations are watching the progress of branded items firsthand.
Retailers can directly see the impact of consumer awareness and are up to date with the latest trends in the market for cannabis products. With that in mind, the Investing News Network (INN) gathered two top-line cannabis retail executives to share their experiences and understanding of the market.
David Farris, vice president of sales and marketing with Planet 13 Holdings (CSE:PLTH,OTCQB:PLNHF), and Trevor Fencott, president and CEO of Fire & Flower Holdings (TSX:FAF,OTCQX:FFLWF), joined INN for an in-depth panel on the cannabis retail business and shared their perceptions on branded products.
One of the key differences between the two operators is location. Fire & Flower is a Canadian retailer, while Planet 13’s main focus is its megastore in Las Vegas, Nevada.
However, Fire & Flower recently made public its plans to expand into the US marketplace.
“We really dictate the sales within our store,” Farris told INN. The executive explained that Planet 13 has done the heavy lifting when it comes to the purchasing process by attracting consumers into its stores.
“We have an algorithm to make brands successful in this store,” Farris said as he explained a joint effort between stores and vendors to reach specified targets with new launches.
The executive said confidently that if the process goes along the right way, there’s no doubt of the results. “It’s almost guaranteed at this point that they will hit a certain level of sales,” Farris said.
Farris stressed to INN that the key for any new branded product launch is quality. The team at Planet 13 spends a remarkable amount of time making sure the products that go up in the company’s store are up to par with its quality standards.
The company has set up a launch package option for companies where a team of experts figures out the best conditions for a product to be introduced at the store. “We’re one of the only companies that I know of that has a full dedicated classroom and department, about five individuals, that focuses on new employees, ongoing training, launches, the whole nine yards,” Farris said.
The executive added that budtenders try out products when they launch to familiarize themselves with their qualities. Farris said Planet 13’s store in Las Vegas has approximately 120 budtenders on staff.
Regulatory differences affect store operations
When it comes to Canada and the US, there are many differences in the two cannabis markets.
Since Canada has a federally regulated industry, it must adhere to specific guidelines and rules set up by the government. Because cannabis is not yet federally sanctioned in the US, state regulators are in charge of overseeing cannabis marketplaces.
When it comes to advertising and marketing products, Fencott said it’s always refreshing to see what can be done in the US compared to up north.
“It always warms my heart being in the US where you can see a billboard with a product advertised on it,” Fencott said. “To me that’s an adult-use product being properly advertised.”
He said the reason there hasn’t been as strong brand awareness in Canada is because of regulations around packaging and advertising.
“There’s very little brand resonance with people,” Fencott said. Consumers struggle to differentiate between products at stores due to the packaging rules, according to the Fire & Flower CEO.
In the long run, Fencott said he is optimistic that the example provided by mature US state markets can help move along the current rules in Canada.
Check out the entire video conversation to hear all the thoughts from the two leading retail executives.
Don’t forget to follow us @INN_Cannabis for real-time updates!
Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.