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Data is transforming the cannabis industry, and as a result, new technology companies are opening in the cannabis space. In addition, traditionally non-cannabis companies are extending their brands to the industry.
Today, databases, predictive analytics, artificial intelligence, and machine learning are having widespread effects on cannabis businesses, investors, regulators, and consumers. Through advanced data collection, technology, and the application of sophisticated algorithms, usable data is now available to help cannabis and ancillary businesses:
Let’s take a closer look at some ways data and technology are directly impacting the industry.
The distribution process for cannabis products is different from one state to another, but it’s always complicated due to security and regulatory compliance concerns. When it comes to getting products to the final distribution point – the customer or patient – big data and technology are having significant effects.
You might not instantly think that marijuana delivery and big data go together, but think again. For example, cannabis delivery company Eaze captures data related to customers’ locations, products purchased, time spent considering each product, amount of time items were placed in the shopping cart before being removed, and much more. The company analyzes all of the data it collects and uses artificial intelligence, predictive analytics, and machine learning to put the information into usable formats for its clients.
Many companies use the data Eaze collects for marketing purposes – to target consumers with specific product messages, to create special offers, to develop new products, and more. The company helps businesses understand who their customers are and how those customers use their products. This data enables the businesses to develop better products and increase the return on their marketing investments.
Today, big data is critical to decision-making in the cannabis industry. Having access to real-time intelligence can mean the difference between success and failure in this fast-moving marketplace. Technology platforms like Headset track inventories, consumer data, and market trends from millions of data points. Using artificial intelligence and predictive analytics, the platforms turn the data into meaningful information that clients can quickly access.
Companies use the data available in these platforms to analyze inventory trends, reordering, items sold per transaction, number of items sold per budtender, transaction totals, grow cycles, production schedules, packaging needs, staffing requirements, product launches, market share, sales projections, wholesale prices, consumer trends, consumer behaviors, consumer spending, healthcare trends, and more. The data can also be used to analyze competitor brands, competitor product releases, and competitor prices.
Having access to this kind of data helps cannabis business communications, spending, and decision-making, but it does even more than that. It also helps these businesses stay ahead of the competition and gain measurable market advantages.
For example, subscribers to the Cannabiz Media License Database can optimize the ROI of their email marketing campaigns using the built-in performance optimization tools that are powered by data and artificial intelligence.
Big data also plays a role for investors who can use the artificial intelligence from VantagePoint to predict the cannabis stock market, identify patterns, and make less risky forecasts and investment decisions. When it comes to mergers and acquisitions in the cannabis industry, investors can simulate deals using the AI-powered tools in Cannabiz Media’s Cannabiz Intelligence™ platform.
From a business risk perspective, cannabis companies use artificial intelligence, predictive data, and machine learning technology from companies like Adherence Compliance to analyze compliance data and predict where marijuana license holders are most likely to fail. This enables them to make critical proactive decisions in order to mitigate those risks.
RELATED: Listen to the Cannabiz Media Cannacurio Podcast with Justin Mayhall of Biotrack to learn how Cannalytics from Helix Biotrack helps cannabis businesses make intelligent business decisions with a mix of data analysis and machine learning algorithms.
A number of technology companies are developing solutions to improve operational efficiencies, so cannabis businesses can streamline and automate processes, increase revenue, and improve customer experiences.
Several tech companies that offer solutions to cultivators have gotten a lot of attention over the past couple of years, including METER Group, a company that provides systems and real-time data to cannabis cultivators, which helps them improve productivity, efficiency, and grams per square foot per year.
Another example is the GrowLife system, which uses data and artificial intelligence to automatically make changes based on growing conditions to reduce the cost of production and the risk of over-supply for cannabis cultivators. At urban-gro, big data is processed at scale, and using predictive metrics, cultivators can make quick and better decisions that lead to improved crop outcomes.
Creating positive customer experiences starts with delivering products that people actually want and need. To achieve that goal, Wana Brands uses data as part of its research and development process through a collaboration with The Effects Lab by budboard. The Effects Lab is an R&D partner for cannabis product development that uses complex cannabis data, artificial intelligence, and machine learning to improve and accelerate the R&D process.
Data and technology can predict the direction the industry is going in and what consumers will want next. However, all data is not created equal. The challenge is collecting, standardizing, and analyzing data that is highly reliable and relevant.
In addition, the people accessing the data to make critical business decisions need to know what questions to ask in order to fully use the data available to them and leverage the power of artificial intelligence and machine learning. It all starts with quality data.
Bottom-line, companies that have access to real-time business intelligence and reliable predictive insights are better positioned to mitigate risks from all sources and increase revenue and profits. This data-driven intelligence will enable the companies that invest in it to gain valuable insights about what consumers truly want and need from cannabis brands. Ultimately, big data and technology can improve the overall customer experience, which leads to sustainable growth for any company that is wise enough to start prioritizing, collecting, and using it today.
Originally published 6/18/18. Updated 6/28/22.