The Impact of Big Data and Technology on the Marijuana Industry

Data is changing the cannabis industry, and as a result, new technology companies are springing up in the cannabis space. Additionally, traditional non-cannabis companies are expanding their brands into the industry.

Today, databases, predictive analytics, artificial intelligence, and machine learning are having far-reaching implications for cannabis companies, investors, regulators, and consumers. Through advanced data collection, technology and the application of sophisticated algorithms, actionable data is now available to support cannabis and related businesses:

• predict trends
• Meet consumer demands
• reduce costs
• improve efficiency
• Increase productivity
• comply with regulations
• Enhance the potency of medicinal cannabis
• increase sales
• maximize profits
• And more

Let’s take a closer look at some of the ways data and technology are directly impacting the industry.

Big data improves distribution in the cannabis industry

The distribution process for cannabis products differs from state to state, but is always complicated due to safety and regulatory compliance concerns. When it comes to getting products to the final point of distribution—the customer or patient—big data and technology have a significant impact.

You might not immediately think that marijuana delivery and big data go together, but think again. For example, cannabis delivery company Eaze collects data related to customer locations, products purchased, time spent looking at each product, time items were added to carts before being removed, and more. The company analyzes all collected data and uses artificial intelligence, predictive analytics and machine learning to bring the information into usable formats for its customers.

Many companies use the data Eaze collects for marketing purposes – targeting consumers with specific product messages, creating special offers, developing new products, and more. The company helps companies understand who their customers are and how those customers use their products. This data enables companies to create better products and increase returns on their marketing investments.

Big data reduces risk by streamlining the decision-making process

Today, big data is critical to decision making in the cannabis industry. Access to real-time information can mean the difference between success and failure in this fast-paced marketplace. Technology platforms like Headset track inventory, consumer data and market trends from millions of data points. Using artificial intelligence and predictive analytics, the platforms transform the data into meaningful information that customers can access quickly.

Businesses use the data available on these platforms to analyze inventory trends, reorders, items sold per transaction, number of items sold per budtender, total transactions, growth cycles, production schedules, packaging needs, staffing needs, product launches, market share, sales forecasts, wholesale prices, consumer trends, consumer behavior, Consumer spending, health trends and more. The data can also be used to analyze competitor brands, competitor product releases and competitor pricing.

Access to this type of data helps cannabis companies communicate, spend, and make decisions, but it does more than that. It also helps these companies stay ahead of the competition and gain measurable market advantages.

For example, Cannabiz Media License Database subscribers can optimize the ROI of their email marketing campaigns using the built-in performance optimization tools powered by data and artificial intelligence.

‍Big data also plays a role for investors, who can use VantagePoint’s artificial intelligence to predict the cannabis stock market, spot patterns, and make less-risk predictions and investment decisions. When it comes to mergers and acquisitions in the cannabis industry, investors can simulate deals using the AI-powered tools of Cannabiz Media’s Cannabiz Intelligence™ platform.

From a business risk perspective, cannabis companies are using artificial intelligence, predictive data, and machine learning technologies from companies like Adherence Compliance to analyze compliance data and predict where marijuana license holders are most likely to fail. This allows them to make important proactive decisions to mitigate those risks.

‍RELATED: Listen to the cannabiz media Cannacurio podcast with Biotrack’s Justin Mayhall to learn how cannalytics by Helix Biotrack helps cannabis companies make intelligent business decisions with a blend of data analytics and machine learning algorithms.

Big data improves efficiency, revenue and customer experience

A number of technology companies are developing solutions to improve operational efficiencies so cannabis businesses can streamline and automate processes, increase sales, and improve customer experiences.

Several technology companies that offer growers solutions have garnered a lot of attention in recent years, including METER Group, a company that provides cannabis growers with systems and real-time data to help them improve productivity, efficiency and grams per square meter per year.

RELATED: Listen to the Cannacurio Podcast with METER Group CEO Scott Campbell

Another example is the GrowLife system, which uses data and artificial intelligence to automatically make changes based on growing conditions to reduce production costs and the risk of oversupply for cannabis growers. At urban-gro, large amounts of data are processed at scale, and using predictive metrics, farmers can make faster and better decisions that lead to better harvest results.

Creating positive customer experiences starts with delivering products that people actually want and need. To achieve this goal, Wana Brands uses data as part of its research and development process through a collaboration with The Effects Lab by Budboard. The Effects Lab is a cannabis product development R&D partner that leverages complex cannabis data, artificial intelligence and machine learning to improve and accelerate the R&D process.

Key insights into the impact of big data and technology on the cannabis industry

Data and technology can predict where the industry is headed and what consumers want next. However, not all data is created equal. The challenge is to collect, standardize and analyze data that is highly reliable and relevant.

Additionally, the people accessing the data to make important business decisions need to know what questions to ask to fully leverage the data at their disposal and harness the power of artificial intelligence and machine learning. It all starts with quality data.

The bottom line is that companies with access to real-time business intelligence and reliable predictive insights are better positioned to mitigate risk from all sources and increase sales and profits. This data-driven intelligence will enable the companies investing in it to gain valuable insights into what consumers really want and need from cannabis brands. Ultimately, big data and technology can improve the overall customer experience, leading to sustainable growth for any business smart enough to start prioritizing, collecting, and consuming data today.

‍Originally published on 06/18/18. Updated 6/28/22.