The Canadian cannabis retail is evershifting; new retailers seemingly appear daily while existing stores are either being consolidated or finding ways to compete with the onslaught of competitors popping up. One factor that has been leading consumers to different retailers is price. Some retailers set razor-thin margins to entice customers while others offer price-matching for those who’ve done their research using tools such as Reddit.
One tool that has captured Reddit’s attention is hibuddy, an online platform that combines Geodata and aggregated retail cannabis menus, to show consumers not only the closest shop with their favorite product but also the least expensive option. We spoke to Myles Robinson of hibuddy to hear the story behind the tool shaking up Canadian retail.
Humble Beginnings
hibuddy began due to a simple pain-point: it can be hard to track down the latest and greatest products. The team at hibuddy began with industry insiders hunting for quality products amidst the 20+ stores surrounding them. Robinson referenced trying to find BOAZ’s Dank Rainbow and the ever-hyped Cookies drops as two drops that originally illuded him before the creation of hibuddy, and how certain products can be make-or-break when it comes to getting customers in the door.
”There are those high-level products that might be a driving factor to a retailer to bring in a consumer; like I go to a store for Ghost Drops. We were, as consumers, unable to see that information unless I took the time to go to your store. That might mean going to menus, but still, if I'm gonna have 10 stores around me, do I want to go to every menu? Or do I want to go to one website that aggregates those 10 menus? So that's where we started, and it really just grew from there. I'd say the industry, Reddit, the people in the community - they have been our saving grace. [hibuddy] has blown up to something far beyond what we ever expected.
Myles Robinson, Partner at hibuddy
Facing Diversity
While many consumers were excited to see a tool like hibuddy emerge, being shared countless times on Reddit and other social media, some retailers weren’t enthused, claiming menu aggregation could potentially lead to undue price competitions between retailers. Due to this, hibuddy transitioned into an “opt-in” model, where retailers would expressly give permission to have their menus aggregated to hibuddy as a tool. While pricing is important, Robinson reaffirm the belief that it’s not paramount, and that hibuddy can be used for retailers to differentiate their offerings from competitors.
”I'm about the belief that not every one of my SKUs as a producer needs to be on every retail shelf. Then as a retailer, I don't need to carry every available SKUs in my store to obtain profitability. And so the one thing we've found out now looking at the data is that most of a retailer segment and say a 10-kilometer radius has 40% to 60% of the same menu items.
Robinson then pointed to Toronto’s Dynasty Pot Shop as an example of a retailer taking a different approach.
”The people at the store, they have a differentiated model; they carry under 100 SKUs. They sell through their SKUs regularly and bring in the fresh and what they need to. So for us, we understand that they're sitting beside major retailers on every side but they're able to carve out their niche market of consumers based on activities that they put on, engagement with their community, and having the right assortment of products that bring people through the door.
A Growing Giant
Just how popular has the platform become? Since launching, hibuddy has grown from 25,000 to 50,000 unique visitors each and every month, seeing a steady 5% month after month. Robinson points to the latest round of OCS releases as catalysts to the growth of the website.
”The people at the store, they have a differentiated model; they carry under 100 SKUs. They sell through their SKUs regularly and bring in the fresh and what they need to. So for us, we understand that they're sitting beside major retailers on every side but they're able to carve out their niche market of consumers based on activities that they put on, engagement with their community, and having the right assortment of products that bring people through the door.
As the platform grows, Robinson wants to use hibuddy to help customers not only find their products for the lowest price but help users to find stores they will connect with. Robinson laid out plans for hibuddy to begin adding filters to the store lists to highlight stores with unique selling points, such as being locally owned & operated, having price-matching, access to delivery, and highlight stores owned & operated by POC and other disenfranchised communities.
hibuddy also has plans to become more active in the cannabis scene overall, as Robinson hinted at potential collaborations with retailers; such as sponsoring a 4/20 event this coming April.
A Changing Climate
As the market continues to grow and evolve, and hibuddy continues to steadily grow to 100,000 monthly users, hibuddy’s team is anticipating a change in power dynamics in the market, guided by evolving consumer habits.
”As flow through programs come through, it will be all about LP and retailer can create connections and making sure that they, as a producer, can communicate the value of being listed inside those stores to the retailers. For me, it's almost going to be the great switch at that point from the power being in the retailer's hands to the power being in a producer’s hands, and it comes into a mature market. If you look at PepsiCo, Fritolay has removed its chips from Loblaws stores over a pricing competition. As an established producer, they hold the power to choose where they want to put the product, it's the consumer who is looking for their product and finding an accessible store where they can buy it . So while we're all playing in the same playground of available SKUs, it's going to be about what you can do to ultimately differentiate yourself.
Last Updated on April 5, 2022 by ADCANN
