The price increase will hit the cannabis industry

Rising prices are flirting with another industry – to the fear of consumers… will marijuana be next?

Price increases or dynamic pricing are already part of business and consumer behavior. Uber, airlines and hotels are leaders in charging more for something when you need it most. Uber has faced constant backlash for charging up to four times the regular cost. Wendy's is now causing an uproar because they want to experiment with price increases and people are worried. Theoretically, burger prices could rise during “lunch hours.” But will the price increase hit the cannabis industry? In a way, yes.

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Nowadays rising/dynamic prices are seen as negative. For a good reason. Federal regulators have been scrutinizing motor vehicle services after several sharp increases amid extreme weather conditions. This forced Uber to agree to limit surges during declared emergencies to avoid being accused of price gouging (which is clearly illegal). But as people got used to hailing a taxi from their phones, they also adjusted to rising prices becoming the new normal.

Photo by Flickr user ctj71081

But dynamic pricing has been used to benefit customers for decades – Taco Tuesday to get people to eat out earlier in the week. Half price bottles of wine to fill restaurants on a Monday. Even Black Friday is a way to encourage people to get in the holiday spirit early – around 5 a.m.

It had a huge impact on the alcohol industry – in the form of happy hour. Happy hour became a Navy buzzword in the late 1950s and entered the mainstream. The idea of ​​discount drinks and happy hours really took off in the 1970s. Guests had the benefit of sipping after work at a discounted price (or just more bang for the buck with 2 for 1). For restaurants and bars, customers have been lured in at slower times (4-6 or 7 p.m.) and can pick and choose the special offers, allowing them to add value and still make a profit.

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Marijuana dispensaries have also embraced happy hour pricing and stores are offering time-sensitive deals. In an effort to attract customers and fill slow hours, there are things like “buy one, get one with 20 percent off every day from 9 a.m. to noon and 4 p.m. to 6 p.m.” Or “weekdays from 8 a.m. to 10 a.m.; 20 percent off premium eights and more.” Dynamic pricing is used to adjust consumer behavior… and a good discount is a powerful incentive, and the marijuana industry is taking note.