Why Cannabis Brands Are Turning To Data Instead Of Discounts

The Race To The Bottom Is Over. Cannabis Retailers Want Retention

In many cannabis markets, brands and retailers have spent years competing on price.

Discounts, promotions, loyalty rewards, and even giveaways have become increasingly common as operators fight for market share. But as margins tighten, many businesses are beginning to ask a different question: how do you keep customers coming back without sacrificing profitability?

That question was at the center of a panel discussion titled “Segmenting Consumer Education for Real Impact” at the IgniteIt Cannabis Capital Conference in Chicago.

Moderated by Buddhist CEO Jocelyn Sheltraw, the conversation brought together Cam Rizai of PufCreativ, Peter DeCaro of Resinate, Philip Wolf of CashoM and THC ServePro, and Elizabeth Rice, Director of Sales Operations at Kiva Brands.

The consensus was clear: operators can no longer afford to treat consumers as a single audience—and high-quality data, cleaning, processing, and worker education are the key to retention and loyalty.

Data Is Only Valuable If You Can Use It

For Rice, customer segmentation begins with understanding the data.

“There is a lot of great data available,” she said. “But then you need to clean it.”

Rice explained that Kiva relies heavily on analytics platforms to understand metrics such as product velocity, average selling price, retail pricing, and purchasing behavior. More recently, she said, artificial intelligence has become an important tool for making sense of increasingly complex datasets.

“We recently introduced AI into the company, and it has been a big game changer for customer segmentation,” Rice said. “Now we can focus our time and effort where we should.”

The goal, she explained, is not simply to gather information but to use it to create better customer experiences.

“Once you know what consumers are into, you can offer more products, cross-sell more effectively, and create a better experience.”

Beyond Demographics

For DeCaro, understanding customers requires looking beyond traditional demographic categories.

“As retailers, we initially thought we knew exactly who our customers were,” DeCaro said. “Then we realized how different consumers actually are.”

Resinate began analyzing age groups, purchasing patterns, and brand performance, but eventually expanded its approach to include psychographics and community-specific preferences.

“We learned we needed to expand psychographics in a very strategic way for each community,” he explained.

That process helped the company understand not only who its customers were, but how they wanted to engage with brands and retail experiences.

According to DeCaro, customer engagement now happens across multiple touchpoints, including email, text messaging, in-store interactions, online search, and budtender recommendations.

“You are talking to your customers through Google, in-store, and through the budtender experience,” he said.

Retention Is The Real Growth Engine

The discussion repeatedly returned to one central theme: customer retention.

In highly competitive markets such as Massachusetts, where dispensaries often operate in close proximity to one another, DeCaro argued that understanding customer behavior has become a critical competitive advantage.

“We compete in saturated markets,” he said. “Understanding who our consumers are and building experiences around them has helped us achieve double-digit growth.”

That growth, he added, comes from both customer acquisition and retention.

“Without retention, you are wasting money and time.”

For retailers, one of the clearest indicators of whether a strategy is working is product movement.

“Reorders are a vital sign,” DeCaro said. “If the product doesn’t move, it’s probably because your retail strategy is failing.”

Rather than relying solely on discounts, panelists suggested that operators should focus on building loyalty through relevance, convenience, and personalized experiences.

As cannabis markets mature, the ability to understand customers more deeply may prove more valuable than simply offering the lowest price.

For many operators, the next competitive advantage may not come from selling cheaper products. It may come from knowing exactly who their customers are—and serving them better than anyone else.

Data, Retention, And Long-Term Growth

The panel’s central argument was that none of this is possible without quality data. Customer segmentation, product assortment, loyalty programs, community engagement, and personalized marketing all depend on an operator’s ability to collect, analyze, and act on consumer insights. The challenge is no longer access to information. It is turning that information into decisions that improve the customer experience and generate measurable business results.

For executives, the implications extend well beyond marketing. Understanding customer behavior can improve inventory management, increase marketing efficiency, and ultimately improve margins. In an environment where many operators are competing on price, the ability to build loyalty and increase customer lifetime value may become one of the industry’s most important competitive advantages.

Those themes are likely to remain at the center of industry conversations as operators search for ways to grow profitably in increasingly competitive markets. They will also continue shaping discussions at future IgniteIt events, including the Colorado Market Spotlight in Denver on September 18, where operators, investors, and industry leaders will gather to discuss the strategies, technologies, and partnerships driving the next phase of growth.