Strong Retail Brands Will Push Their Competitors out of the Cannabis Market - Seite 2

For cannabis companies, opening over 100 dispensaries across the country would be a dream come true. Instead, most have had to adopt a slower approach of either building or buying out multiple dispensaries in each state. Many of these stores also aren't built on prime real estate. The competition is fierce, and companies with brands that are most influential with buyers are the ones that win these locations.

The Importance of Prior Retail Experience

There are many strategies for helping expose cannabis to potential customers. With some statistics indicating that the majority of Americans haven't tried marijuana, it's up to companies to change the public perception of consumption. Many businesses talk about improving the retail experience and revolutionizing the use of branding; few follow through with these promises.

Most cannabis brands are segmented by traditional customer demographics, such as high-end luxury, low-end value brands, etc. The most common approach has been to bombard customers with as many options, strains, and prices as possible, a strategy most retail executives know to be mediocre.

Instead, companies enjoying the most success are those that use brands to appeal to emotion. Most dispensaries are lucky to generate revenues of $6,000 per square foot. In contrast, a Las Vegas dispensary called "The Source," owned and operated by Green Growth Brands (CSE:GGB) (OTC:GGBXF), sees revenues of up to $14,000 per square foot. By following this brand-centric approach, this store alone boasts revenues 130 percent above average.

Much of this success comes from the company's management team. Green Growth Brands (CSE:GGB) (OTC:GGBXF) CEO Peter Horvath brings his decades of experience leading Victoria's Secret, American Eagle Outfitters, DSW, and other brands. Another figure to note, CMO Scott Razek, also has a 25-year tenure as a marketing executive in many of those same companies. Both executives left behind lucrative corporate roles in mainstream industries for the sheer growth potential of cannabis.

Back in 2018, Jim Cramer on CNBC's Mad Money would describe Peter Horvath as being "the first CEO that's going into retail that's actually been in retail" With this new deal under his belt, it's clear that the company is becoming perhaps the strongest cannabis brand and retail presence in the market.

First Mover Advantages in Auxiliary Markets

While cannabis retailing has focused mainly on traditional plant products, there's much to be said for alternative product lines. CBD-infused edibles, beverages, and topical oils are a market estimated at being worth $4.1 billion by 2022, with the CBD market in general projected at $22 billion. At the same time, these products attract different types of customers with different profiles and can't be marketed to in the same way.