April 24, 2020

Cannabis Market Data Analysis Tips in the Time of Covid-19

It's an unprecedented time and we have some tips to help you use the power of data as effectively as possible now, and into the future.
Written by
Liz Connors
Published on
April 24, 2020
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Interested in the vapor pen market? Read our comprehensive 2023 report. Get the low-down on which brands and form factors are gaining the most market share as well as demographics about the consumers doing the most purchasing.

During these unprecedented and volatile times, it is more difficult (and more important) than ever to understand the nuances of your business in the cannabis space. Whether you’re a retailer, producer, or investor, you’re thinking about the same questions we are at Headset: Will things ever ‘get back to normal?’ When will that happen? Will there be a “new normal”? Sadly, no one has the answers to those questions. We do however, have some tips to help you use the power of data as effectively as possible now, and into the future.

Find our broad tips below with suggestions of where to dive into deeper analysis in Headset Insights.

Look beyond your brand:
You should always look to your category and competitive landscape to provide context for your brand’s performance, but that is even more true now. If your brand’s sales are up 15% over last quarter that may seem like fantastic performance at first glance.  But, if the overall category is up 25% and your primary competitors are up 30% over the same time period than the narrative is suddenly very different.

Insights Dashboards: Category Details , Segment Details,  Brand Compare

Think beyond your usual category or segment:
It’s critical to watch category level trends across an entire market. If you sell Flower and Pre-Rolls, and both have 5% increased sales last month, that could be indicating two very different things depending on the overall category share trajectories within your market.

Insights Dashboards: Market Overview, Category Details, Segment Details, Data Export > Category, Data Export > Segment

Don’t ignore other markets:
Watch trends in other markets - how is your market similar? How is your market different? During the COVID-19 pandemic, sales are above average in Washington, California, and Oregon,  but below average in Nevada and Colorado. What do NV and CO have in common? Economies heavily driven by tourism (especially during ski season in Colorado). When one state lifts a lock down before yours, it can be an indicator of what to expect when it’s your turn.

Insights Dashboards: All Markets Overview, Market Overview, Insights Pulse

Drill into package sizes: Are your sales increasing equally across package sizes? In the era of COVID-19 stock up shopping, probably not. For example,  as we’ve reported on our COVID blog, the largest package sizes of Flower have flown off the shelves while grams saw very little sales boost. This type of analysis can help you plan your manufacturing plan for future demand.

Insights Dashboards: Category Details, Segment Details, Pricing, Data Export > Package Size

Look at unit volume and pricing to understand total sales
Total sales can increase in multiple ways: increased unit volume at the same price, or increased price at the same unit volume (or increases in both once). If your competitor’s top line sales grew by 30%, did their unit volume increase at the same level? Did they raise prices? Both?

Insights Dashboards: Pricing, Discounts, Brand Details, Brand Compare > Pricing

Break it down further with Equivalized (EQ) Price and Cost
This is a great time to include EQ price and EQ cost in your analyses as it helps you put your competitive landscape on an even scale.  In Headset Insights EQ price refers to the average price per gram for inhalable categories (Flower, Pre-Roll, Concentrates, and Vapor Pens) and average price per milligram of THC sold in the non-inhalable categories (Edible, Beverage, Tincture, Topical, and Capsules). EQ cost is the average cost for the same equivalized units.  This allows for easy comparison across package sizes (eg. 10mg vs 100mg Edibles or 1g vs 28g packages of Flower).

Insights Dashboards: Category Details, Segment Details, Brand Compare > Pricing

Be very specific with your time frames:
Our analytics team asks one question more than any other when evaluating cannabis sales metrics: “Over what time frame?” It’s a question that you should always be asking too! A time period filter is available on almost every Insights dashboard that allows you to select any set of individual days using the “Custom” tab. With COVID-19 stay at home orders being placed and extended at different times in every market, it’s especially important now to understand the temporal context of any analysis before drawing conclusions.

Insights: Most dashboards

Think About Consumer Shopping Patterns: It is always helpful to know when customers are shopping to help plan staffing, deliveries, or vendor days. During the COVID-19 pandemic the fairly stable trends we’ve been watching for years have suddenly shifted. Customers are have moved slightly away from weekend shopping in favor of visiting the shop on weekdays. In addition, we see people shopping earlier in the day than was typical pre-covid. Understanding when to expect volume now and what it will likely switch back to once the pandemic ends can help you plan efficiently for demand.

Demand Planning: Hourly + Day of Week

Think about sales channels:
While cannabis delivery was already legal in some markets, many more are scrambling to allow sales to continue while honoring social distancing procedures with new options for delivery or online ordering and curbside pick up. Headset’s brand new Purchase Method Dashboard will allow cannabis retailers to understand the differences in total sales, category share, basket size, and pricing between these two distinct sales channels.

Retailer: Purchase Method

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