In the previous part of this series, we briefly discussed how the different active components of the cannabis plant make it a more complex product than tobacco and alcohol. There are hundreds of strains of cannabis plants. Naturally, companies selling cannabis products would spend heavily on educating customers to enable more informed decisions.
Brick and mortar
Brick-and-mortar locations may become a point of information for customers seeking to learn more about cannabis for recreational purposes. According to Canopy Growth’s Company (WEED) filings, currently, it has locations in Southern Ontario that educate medical marijuana users. According to the company, these locations may also serve recreational users if the law permits. Companies (MJX) like Aurora Cannabis (ACB), MedReleaf (LEAF), and Cronos (MJN) may also follow this model.
Such initiatives would also educate potential customers about the risks of consuming marijuana, which have been an issue put forward by opponents of legalization.
Preferred purchase location
In a survey conducted by Deloitte titled “Recreational Marijuana Insights and Opportunities,” Canadian’s most preferred method to purchase marijuana was through pharmacies, followed by privately owned retailers. Canopy Growth’s brick-and-mortar locations fall under the latter category.
From the survey, Deloitte showed that non-consumers preferred pharmacies while current consumers preferred privately owned retailers. Deloitte concluded that current consumers preferred privately owned retailers because “they want to be served by educated retailers or ‘bud tenders’ who can help them match need to product.” This finding goes along with the above companies setting up their physical shops.
As an investor looking to learn more about the marijuana industry, you can refer to the following articles.