The importance of e-commerce for cannabis retailers

POSTED ON October 15, 2021

eCommerce for cannabis retail

The internet has transformed the way we buy things online. Information is accessible with a few taps on our phone screens, and purchasing is increasingly frictionless. As a result, brick-and-mortar retailers are forced to compete online as well as in-store. Cannabis is no exception.

At Greenline, we want cannabis retailers to have everything they need to be successful in this nascent, yet competitive industry. Let’s learn about the e-commerce offerings available for Canadian cannabis retailers.

Embedded menus

Setting up e-commerce doesn’t have to be intimidating and complicated. Modern software providers have built out ways to include full e-commerce functionality with a single line of code added into your website.

Often called ’embedded menus’, all they need is a website to live in. This can be on WordPress, Shopify, Magento, or any other website framework – these menus are agnostic. Once you have your website and branding up, dedicate a page (ex. /shop) to embed your code in, and you are off to the races!

  • Pros: Extremely simple to set up, fully functional. Offered by all cannabis e-commerce platforms.
  • Cons: Menus look very similar to all other retailers using the same provider. Poor SEO
Headless e-commerce

‘Headless’ is a confusing term, but it refers to the fact that the e-commerce functionality is completely API-driven with very little to no pre-built user-interface (UI). This means that you are fully free to lay out your components (categories, product lists, filters, carts, etc.) the way you see fit, but it requires software development expertise.

Headless e-commerce is a relatively new offering primarily offered by Dutchie and Jane.

  • Pros: Extremely customizable, can be distinct in both visuals and user-experience (UX) from competitors
  • Cons: Requires software development expertise. The service is often much more expensive than embedded menus
Custom-built e-commerce

Some stores may decide that pre-existing software solutions are not sufficient for their needs. If your ambition lies in a tightly controlled software ecosystem, custom features nobody has, alongside the capital and talent pool required, custom may be the way to go.

It is challenging to build your own system from scratch. Fire and Flower is a prime example of a well-capitalized cannabis retailer who went as far as acquiring HiFyre to lead their technology efforts. Clearly this won’t be an accessible approach for most.

We encourage you to contact our team to learn about our robust API offerings if this is a path your business is looking to head down.

  • Pros: Fully your vision, the sky is the limit.
  • Cons: Can vary wildly in costs depending on software development expertise. No pre-existing API connections with cannabis POS systems, must be built from scratch.
Marketplace menus

Your e-commerce website is most effective when consumers already know about it. When your business is trying to expand its reach, you need to find ways to attract new consumers, whether it’s via physical marketing or digital marketing. Being listed in a marketplace menu (such as Leafly or Weedmaps) can be a highly effective way of capturing consumers who already have an intent to buy.

  • Pros: Attract consumers who otherwise might not have known about your store
  • Cons: Software fees can be expensive

When cannabis was legalized in Canada, deliveries were limited to a select few provinces. Now, both BC and ON support full private retail deliveries.

Unlike restaurants, who can use 3rd-party delivery services such as Uber Eats, cannabis retailers in BC and Ontario must deliver via their employees and their own vehicle fleets. One can imagine the overhead costs and logistics required to run a successful operation. As a result, it is not something all retailers should pursue – only those with the digital infrastructure who are able to capitalize on the opportunity.

  • Pros: Can drastically increase the reach of your business and increase customer loyalty
  • Cons: Requires substantial preparation, investment, and overhead to do it right

E-commerce solutions can range from $0/month to $2000+/month depending on your service provider. It is not a one-size fits all – one must evaluate the needs and opportunities of your business to see what makes sense.

For those who are cost-conscious, going for a free solution can make sense; however, it’s important to know that the software makes money by aggregating your product, inventory, and sales data to sell to consultants, LPs, and various other data brokers. If you are not comfortable with your data being used in this way, it may be worth considering paid options.

The price range of e-commerce solutions you should consider depends on the opportunity size your business has access to and the capabilities of your team. If you see an opportunity to earn $5000+/month via e-commerce, then a $2000/month option is viable, but if you only see additional e-commerce orders in the hundreds, that option will not. When the answers aren’t obvious, don’t be afraid to start small and grow from there.

What Greenline can offer
Greenline Marketplace

At Greenline, our philosophy is to provide our customers with as many best-in-breed e-commerce solutions through our integrations marketplace. Whatever your e-commerce strategy is, our team is confident that we’ll have a wide range of options for your business. For example, Greenline’s e-Commerce website development partner, Black Hawk Digital can help guide you and design a website that connects with many Greenline integration partners. Website solution providers can often provide a variety of additional services you may want to consider to help grow your business including SEO and branding.

Greenline Capital

Greenline also offers a viable solution for customers to help with exactly these kinds of costs with Greenline Capital. Learn more here.

Contact our sales team by scheduling a demo here.