Not only is 4/20 the industry’s most important holiday, it’s also the biggest sales day of the year. In 2022, rising consumer demand and increased availability of legal products in the U.S led to sizable booms in business at dispensaries. The industry shattered records for the most money ever spent on a single day, tallying over $154 million in legal sales, a 38% increase from last year’s recording-breaking holiday, according to cannabis enterprise software company Akerna 

The fanfare around 4/20 presents companies with a unique opportunity to reach new customers and bring them into their stores. Leading retail insights provider Headset found that on average, cannabis stores experienced 148% higher sales on 4/20 than on the previous four Wednesdays, and that the median cannabis store saw a 107% increase in transaction volume, meaning on 4/20, dispensaries drove in significantly more shoppers than they typically do. By delivering exceptional retail experiences, companies can turn first-time buyers into loyal, repeat customers.

The high growth numbers for this year in particular are due to a myriad of factors, including the fact that more markets have come online, cannabis is becoming less stigmatized and more accepted in mainstream American culture, and companies are offering a wider range of products and reaching more customers through better omnichannel retail experiences. While it might take a few more years for 4/20 to be considered a national holiday – Trulieve (OTC:TCNNF) even attempted to apply for the official designation but was turned down due to its affiliation with the cannabis industry – the day is a tremendous opportunity for dispensaries to forge lasting relationships with both new and returning customers. 

As cannabis markets mature, more products are available now than ever before to serve a diverse range of consumers and keep up with evolving preferences. Consistent with previous years, beverages, pre-rolls, edibles and concentrates performed particularly well this 4/20. According to Headset, compared to the previous four weeks, beverage sales surged 176%, concentrates increased 155% and pre-rolls increased 150%. In terms of market share, cannabis point-of-sale software provider Flowhub found that the edibles category grew 5% year-over-year, reaching 13%, and flower lost 4% market share, hitting 59%. While edibles still ranked third after flower and concentrates in 2022, the 5% growth in market share signals a significant trending shift in consumer preferences, impacted by the influx of better products hitting shelves and new consumers entering the legal market. Typically, customers new to cannabis tend to gravitate towards edibles and beverages since smoking flower is perhaps a bit more intimidating and less discreet.

Providing modern omnichannel retail experiences continues to be a challenge for dispensaries due to the industry’s regulatory constraints, but dedicated technology and payment platforms have enabled more dispensaries to offer digital services, which are bolstering sales. Cannabis delivery, still in its infancy and held back by regulatory hurdles, only accounted for 3% of transactions this 4/20 according to Flowhub. However, there were more than twice as many delivery orders placed this 4/20 compared to last year, showing signs of progress ahead.

Making online reservations for in-store pickup has become increasingly popular among cannabis consumers, so providing a user-friendly, informative website with optimized SEO is key for cannabis companies striving to drive in more business and retain customers. For MSO Jushi (OTC:JUSHF), online reservations comprised 60% of its total 4/20 sales, and Jushi’s Beyond Hello™ website saw its highest hourly peak on record and the highest daily traffic ever during 4/20 this year.  

Brick and mortar still dominates the cannabis retail space, but retailers are now merging the physical and digital, capitalizing on marketing and engagement opportunities to drive in-store traffic. Cannabis marketing platform springbig reported that dispensaries sent over 14.5 million promotions via text messages on 4/20 this year – up 18.3% from last year – helping generate nearly 500,000 store visits and $40 million in sales, an 18.8% increase in visits and a 5.4% increase in sales over last year’s holiday. These increases highlight how retailers must be ready to approach this holiday from all fronts and lean into digital solutions to connect with target audiences. Leveraging omnichannel inroads is particularly important as Gen Z consumers have emerged as not only the fastest-growing demographic but also the biggest spenders on 4/20.

Sales data reveals that dispensaries experienced growth in almost every area of the country this 4/20, but the levels of growth and revenue varied considerably between states. In terms of year-over-year sales growth, states with newer markets experienced higher numbers. Jane Technologies found that Arizona, which commenced adult-use sales in January 2021, experienced a 100% increase in sales this 4/20, and Illinois, which opened its adult-use market a year earlier, saw a 54% increase. The already strong medical markets of Pennsylvania and Florida also experienced impressive growth, increasing sales 18% and 10% respectively. However, Jane found sales numbers actually decreased year-over-year in Colorado (-20%) and California (-15%). In these mature, more competitive markets, dispensaries need to go above and beyond to meet higher customer expectations in order to succeed.

As the cannabis industry matures, brands are becoming savvier, marketing towards different segments of the population and providing more inclusive product offerings. Data from this year’s holiday shows that demographics are shifting among cannabis consumers in the U.S. Akerna found that women made up more than 40% of customers this 4/20, a departure from the past where male consumers dominated the market and were considered the target demographic of many companies. Akerna also found that 59% of purchases were made by consumers under 40. These younger consumers, who have less stigma around cannabis, will continue to take up more market share going forward, and retailers need to appeal to them by leaning into digital solutions. 

As the cannabis industry rapidly expands and evolves, companies can learn a lot by analyzing data from this year’s 4/20 to see where they’re doing well and to identify opportunities for improvement. Leveraging this data, while also staying up to date with key industry developments, will help companies boost sales and further their success as they head into other important retail days such as 7/10 (OIL day), Green Wednesday and of course, next year’s 4/20.