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Marijuana retailers add VIP rooms, consumption lounges, other amenities to woo customers

· Oct 27, 2021
All are features businesses in the hotly competitive marijuana industry are incorporating into their retail operations to stand out from the crowd and attract customers. Advertisement ...

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Drive-thrus, VIP sales areas, consumption lounges – even separate rooms to buy cannabis growing equipment.

All are features businesses in the hotly competitive marijuana industry are incorporating into their retail operations to stand out from the crowd and attract customers.

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That has helped spark a building boom.

The average size of retail space in cannabis stores jumped in 2020 amid increased consumer demand and the COVID-19 pandemic, rising 50% for medical dispensaries and 35% for recreational shops.

“In more mature states where the adult-use market has been there for a bit and the competition is fiercer, many of our clients want to separate themselves from the pack,” said David Fettner, managing partner of Grow America Builders, an Illinois-based, design-build construction firm specializing in the cannabis industry.

Many of Grow America’s clients are looking for ways to make security more subtle and designing their shops with special VIP rooms where deep-pocketed customers get white-glove treatment, Fettner said.

They’re also looking for properties that will lend themselves to drive-thru operations, such as former banks or fast-food restaurants.

In Michigan, Cory Roberts and brothers Edgar and David Ramon formed a partnership to purchase the former Sons of Norway lodge and 4 acres of land in Muskegon, where they’re planning to develop a cannabis retail store, consumption lounge and grow operation.

The new venture is called Michigan Canna House.

“Our concept is that rather than just be retail or cultivation or a consumption lounge, we’re looking at ourselves as a destination spot,” Edgar Ramon said.

“People can spend as much time here as possible – they’ll be entertained, they’ll be fed, and they’ll have an immersive experience.”

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Ramon and his colleagues plan to renovate the existing 11,000-square-foot building for use as a retail store and consumption lounge.

The building’s commercial-grade kitchen will enable Michigan Canna House to serve gourmet food in the lounge, but the cuisine won’t be cannabis-infused.

There will be a VIP area where customers can have products brought to them, much as a sommelier helps connoisseurs select fine wines.

Michigan Canna is in the process of designing a 10,000- to 14,000-square-foot, environmentally friendly greenhouse that will help the company as it attempts to become carbon neutral.

Michigan Canna will use virtual reality and artificial intelligence to help give visitors an immersive experience.

For example, guests visiting the company’s consumption lounge will be invited to use virtual-reality goggles to tour the cultivation facilities to see what stages the plants are in – without setting foot in the grow.

“We don’t want to bring anybody in through our facility – we have to be cautious about cross-contamination,” Ramon said.

 Legacy companies rethink stores

 Even the operators of legacy companies that have been successful since marijuana was legalized in their states are rethinking how to design their stores.

Denver-based marijuana chain Native Roots, for example, has opened two new retail outlets that are similar to an Apple Store. One of them also has a drive-thru.

Customers are greeted by a budtender who will guide them through the store while providing a one-on-one consultation, said Buck Dutton, Native Roots’ vice president of marketing.

Products are displayed by category – edibles, vapes, concentrates and flower – in different sections of the new store.

Budtenders in the new stores use iPads to build their customers’ orders.

Those orders are fulfilled as customers walk through the facility, so shoppers are ready to check out once they’re done shopping.

By contrast, Native Roots’ legacy shops are akin to jewelry stores, with products under glass in cabinets, Dutton said.

Native Roots is conducting customer surveys to determine what works well for the company under each model.

It’s offering customers of its older stores $25 to visit the new facilities and report what they like about each.

“We’re using secret shoppers but with our own customers,” Dutton said. “In the retail business, the customer is No. 1, so we value what the customer says.”

 ‘Super’ checkouts, music, art

Boca Raton, Florida-based Jushi Holdings is working with a national architecture firm to address measures it can take to better accommodate people with disabilities and implement “super” checkouts with up to 20 point-of-sales systems.

The company also wants to incorporate roving and express checkouts as well as walk-up windows.

In addition, Jushi is integrating music culture and art into the experience customers have in its stores.

The company’s Beyond/Hello store in Santa Barbara, California, features artwork from Jona Cerwinske, who garnered attention in the art and music worlds for his Sharpie murals that sell for about $35,000.

Jushi also recently partnered with Colin Hanks to bring his Hanks Kerchiefs line into its stores.

Julian Scaff, Jushi’s experience design director, said the company is “focused on providing our customers with unique music, art, fashion and cultural experiences that complement our modern cannabis retail environments.”

He added: “We also have been using color psychology, musicology, data, research and even the neuroscience of scent to create cohesive customer experiences.”

Express lane, merchandising space

While many retailers are focused on distinguishing themselves from rivals by renovating and building new stores, others have focused on other aspects of the business they believe will differentiate them.

Nevada-based Deep Roots Harvest, for example, is focusing on bolstering its online experience in response to customer feedback.

“People want an experience where they can go to a nice menu, put a pre-order in, pick it up or have it delivered — people want in and out,” said Jon Marshall, chief operating officer of Deep Roots Harvest in Mesquite.

If customers have preordered through the Deep Roots Harvest website, they can pull into an express lane and a runner will bring out the products.

“Of course, there are the ‘never-evers’ who have never been into a dispensary and have a lot of questions,” he said. “We’re trying to create a system where they can slot into a lot of different ways to shop.”

Deep Roots Harvest has also added merchandising areas to its stores where customers can by T-shirts and paraphernalia.

Although the areas are not consumption lounges, seating is available.

Las Vegas-based Planet 13 Holdings, with its Willie Wonka-style production windows where customers watch edibles and beverages being produced, is considered the destination for cannabis fans.

To enhance the customer experience, the company has recently installed more video walls, improved the sound systems and expanded the retail space to accommodate the droves of tourists who flock to its flagship store.

Planet 13 also has added a magnetic wall that gives the appearance of its products floating in cylinders and rotating at various speeds – all intended to give customers a 360-degree experience.

“Tourists want an experience,” Planet 13 co-CEO Bob Groesbeck said, “and it’s our job to provide that experience.”