Online Brand Store or Online Marketplace or Both? How Can Cannabis Merchants Decide?

by | Aug 10, 2022


Jose would have been a civil rights lawyer if he wasn’t in IT marketing – he even got into law school! He loves the cold climate of hill stations and the long drive that takes him there. Once there, he would read or stream; not one for the outdoor.

Many cannabis brands joined the ecommerce bandwagon during the pandemic to ensure their offerings were accessible to customers and patients. The biggest dilemma during this transition, for cannabis cultivators and manufacturers of value-added products, has been choosing between an online marketplace and an online brand store.

While an online cannabis marketplace offers instant time to market and an immediate revenue opportunity with guaranteed visitor traffic, it involves significant trade-offs, especially around customer/patient data access and control and brand identity. A custom online store ensures full customer/patient data access, delivers highly personalized experiences, enables loyalty rewards programs, and provides total control over the brand. However, it takes time to build, test, go live, and market.  

Webscale is a trusted partner to Trulieve, PharmaCann, and Airfield Supply Co. We understand how to make businesses in this dynamic industry successful and we’ve captured our learnings and best practices in a new eBook that you’ll find interesting.

Are you having these conversations right now? Here’s our take on the trade-offs between the two to help you make a decision:

Online Marketplace vs. Online Brand Store – A Comparison

Online Marketplace Online Brand Store
iFrame embedded menu offers only basic UX Develop a custom UI for superior UX
Provides the same iFrame menu for all merchants; no room for brand differentiation Reinforce unique brand colors and emotions through a custom build
Basic visitor analytics provided Dedicated tracking and reporting of visitor analytics
Direct competitors are also listed on the same marketplace Captive website visitors with no distractions from competitors
Offers zero SEO value for your cannabis brand 100% SEO authority for your brand. Every dollar spent on SEM like keywords, and even blogs, benefit your brand
Limited brand recognition as most patients/customers shop for product category or intended outcome Contributes to high brand recognition
Proximity to competition and low brand differentiation may force you to indulge in price wars to attract sales Absolute freedom to showcase your core brand values like quality, experience and price
Less control and access to customer data You own the customer data including demographics and spend, and customer relationships. Can easily run loyalty programs, retargeting and upselling, creative campaigns etc.
Binding contract that may restrict listing on other marketplaces No limitations. Marketplace becomes supplementary and not a substitute for your online presence
Possibility of marketplace-owned brands having an unfair advantage No competition at all
Patients/customers may become loyal to marketplace brand Patients/customers’ loyalty towards cannabis brand
Commission payable to marketplace Zero commission
Dependent on marketplace for uptime, security, performance, and support Can establish a “best-of-breed” approach and engage the best technology for superlative outcomes
Fast time-to-market Time and resource intensive as a green-field project
Guaranteed visitor traffic due to Marketplace brand and SEM Huge investments needed in SEM and will take time to deliver results

Increasingly we are also seeing brands adopting an omnichannel approach and investing in multiple touchpoints to engage with customers wherever they are: physical store, online brand store and online marketplace. Merchants need to evaluate priorities, resources bandwidth and opportunity costs before deciding which options to explore.

Looking for a Digital Agency to Develop Your Online Brand Store?

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