Caliva opened its doors on New Year’s Day to a line of eager customers ready to purchase legal cannabis in San Jose, California. Many drove a few hours from cities without licensed dispensaries for the chance to be a part of history. Momentum continued through the week with sales, store traffic, and delivery at an all-time high.
We saw revenue growth increase five times more and traffic nearly quadrupled.
It was a week of expectations met and a few surprises. Let’s take a look at our major takeaways:
Product Sales Breakdown:
The Rise of the Vape
As we reported back in November, Californians love their vape pens. We were thrilled to see our vape pen line shine in the first week with sales even across the board between the four different SKUs available. Customers enjoy the discrete nature of the vape, the ease of use, and our occasion based options.
Pre-Rolls Win Big
We saw an overwhelming enthusiasm for pre-rolls with many long time illicit market purchasers thrilled that you could by a joint “already rolled.” Our top seller of the week was the Super Session, an infused pre-roll that packs a punch. As predicted, Californians like their pre-rolls rolled with a little added kick from high-powered concentrates like hash, kief, oil, or caviar.
Dogwalkers were a top seller thanks to their amazing portability, size, and style. Their more mellow cousin, Toasties were not too far behind with so many customers fascinated by the product form and price point.
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Flower; Go With What you Know
Flower was the top seller of the week as expected and as previously mentioned, many customers who are no strangers to cannabis were in line to buy the classic product. We saw our top strains sold mirror industry strain trends with OGs and Jacks at the front; Humboldt OG, Purple Jack, and Stardawg were top out of the door with the buzz in line favor strain names over potency numbers.
Regulations are moving all edibles to the microdosing world and Kiva’s Terra Bites along with Plus Gummies saw the most sales. Many long time smokers new to legal sales were elated to learn edibles are dosed and labeled accordingly. Gone are the days of eating a brownie and freaking out. It’s a slow and steady wins the race with today’s edibles. Cannabis beginners were also thrilled to see that there were non-smokable options for getting started.
Pro Tip: Stock up on Accessories
Even the most experienced cannabis user is always down to pick up a clean glass pipe, some rolling papers or even splurge on a new bong. We can’t stress enough how important it is to have these on hand for customer convenience. ___________________________________________________________________________
It was long lines throughout the day on 1/1, with lines tapering a bit during the week, but not a ton. Average wait times continue to vary between twenty and forty minutes. Most customers are not upset by this as they want the chance to spend time with a budtender and get all of their questions answered.
Big takeaways from line management is that customer delights are well-received; raffles, giveaways (e.g. swag, food, coffee, and live music) are always a nice touch and keep your customers smiling in line.
Traffic was monumental, but we did see a dip in customer Average Order Sale (AOS).
Pick-up and delivery saw strong numbers and customers who knew what they wanted were able to order at our in-store pick up station and skip the line. These sales avenues stand to see an increase as customers look to avoid lines, hone in on their preferred categories, and educate themselves on their preferences.
Pro Tip: Provide a fast pass type line to loyal, returning and/or medicinal customers and provide pick up and delivery options to diversify.
Who is the Recreational Consumer?
As expected, many of the die-hards turned out early on January 1st and the morning was packed with an enthusiastic crowd ready to be a part of history. That said, the AOS for the morning crowd was $40 vs. $85 in the afternoon. These numbers were to be expected with the amount of promotion we did to kick off recreational use. Let’s take a look at some key customer segments:
Black to Gray Market
For years we faced challenges getting core cannabis users to get a doctor’s recommendation and come in to buy legally. No surprise to us, this cohort is skeptical of their information being used elsewhere and never made the leap. Over the last week, we’ve seen this crowd come through in droves and range in age from early 20s up to their 70s.
Lab results, potency numbers, and grower profiles were all so new to this group and we expect to see them become more diligent about testing numbers and see them looking at marijuana through the same lens as food (e.g. farm to table movement, value purchases, etc).
It was encouraging to see the Boomer generation out to celebrate the end of a prohibition they’ve been a part of their whole lives. Pleasant surprise; Avg. age of new customers = 53.
Our afternoon crowds are a real snapshot of what is to come from the recreational market. We saw many couples and groups make their trip to the dispensary a fun outing. Their product affinities were mainly flower, pre-rolls, vapes and some edibles (skew female). These groups were overly excited about customer delights and enjoyed looking at menus on tablets together before getting to the budtenders.
Over the last week, a considerable amount of first-time to cannabis users have come in to look for alternatives to opioids, products to substitute alcohol, and are exploring out of plain curiosity. It’s imperative to give these customers special treatment, lower dose product options, and provide them education material as much as possible.
Pro Tip: Track your customer data and make sure your store experience and product array matches your clientele.
The future is bright for California cannabis and Caliva is here to provide insights, products, and opportunity as the legal market evolves in the coming year.