Cannabis was already the country’s fastest-growing industry, but 2020 has taken the space to another level. A record-high percentage of Americans now support cannabis legalization.
While people couldn’t shop at department stores or go to the movies, they could still purchase from their local dispensary. This government recognition was a major signal to the market that the space has been elevated to the mainstream.
A resounding response from consumers followed with record cannabis sales. Unprecedented demand forced cannabis retailers to revolutionize the ways they do business and how customers purchase products. To minimize direct person-to-person contact that can potentially spread the virus, dispensaries turned quickly to e-commerce and digital payment solutions to keep employees and consumers safe while modernizing their business.
I see technological innovation at the forefront of the legal industry moving forward. Technology will enable dispensaries to streamline operations in a highly regulated space where compliance is essential. In turn, data will increasingly become more important as retailers will need to better understand their data to make more proactive, informed decisions. This will be a focus for dispensaries of all sizes, but in particular larger businesses that are looking for an increasingly high level of sophistication for their online experiences.
To meet this need, we’re finally seeing new enterprise-level solutions on the market that empower dispensaries to fully leverage their data to design their unique online identity so they can remain competitive as more players join the space.
As legalization continues to spread, wider adoption will further legitimize the industry and de-stigmatize cannabis sales and use. We will likely see cannabis companies attracting more top talent from some of the most notable companies across mainstream industries, and more software platforms, businesses and investors that were formerly hesitant to enter the space begin to work with and invest in cannabis-related businesses. Federal legalization of cannabis also has the potential to enhance liquidity and open the floodgates to more investment deals.
Additionally, as we’ve already begun to see, there will be an increasing trend toward consolidation across the space as retailers continue to make big acquisitions and mergers. More multistate operators will consume smaller players and smaller players will combine forces, creating a space that is more cohesive and less fragmented.