Big data and technology have become critical to a wide variety of industries in recent years, and the cannabis industry is no exception. Today, databases, predictive analytics, artificial intelligence, and machine learning are having widespread effects on cannabis businesses, investors, regulators, and consumers.
Through advanced data collection and the application of sophisticated algorithms, usable data is now available to help marijuana businesses:
- Predict trends
- Met consumer demands
- Reduce costs
- Improve efficiencies
- Comply with regulations
- Improve the efficacy of medical cannabis
- Maximize sales
- And more
Many companies have been aggregating data from the cannabis market for research and analysis. In fact, data aggregation has become big business in the cannabis industry with big data company New Frontier Data acquiring data discovery platform Zefyr (the ‘Nielsen’ of cannabis) for $10 million in 2019. However, the list of possibilities that big data and technology bring to the cannabis industry has evolved far beyond aggregation.
Let’s take a closer look at five key ways big data and technology are directly impacting the industry.
1. Big Data Streamlines the Cannabis Regulatory Process and Helps Close the Scientific Research Gap
One of the biggest challenges in the medical marijuana market is the inability to conduct clinical research on the efficacy of marijuana because it’s still a Schedule 1 drug at the federal level. Therefore, the growing cannabis market lacks the clinical data needed to help businesses create new and better products. Global Cannabis Applications Corp. (GCAC) is trying to change that.
GCAC’s Citizen Green technology uses artificial intelligence and blockchain to collect clinical data directly from consumers in an effort to streamline the regulatory process that impedes the manufacture of innovative marijuana products. In simplest terms, the technology rewards people who complete surveys with cryptocurrency – digital tokens – that they can use for products available through global medical cannabis programs.
The survey data is reconfigured into a clinical standard and combined with data from actual clinical studies as well as product information. GCAC says its Citizen Green technology provides better patient outcomes and helps researchers find qualified participants for clinical studies, which ultimately, speeds up the approval process for new medical marijuana products.
The reality is the cannabis industry needs access to clinical data to improve product development and further legitimize the industry overall, and they’re looking for innovative ways to access that data.
After being denied from receiving grant money, researchers from the University of New Mexico began using self-reported user data collected via the Releaf smartphone app to conduct research about medical cannabis consumption and symptom relief that led to studies published in two separate journals: Frontiers in Pharmacology and Medicines.
2. Big Data Improves Distribution in the Cannabis Industry
The distribution process for cannabis products is different from one state to another, but it’s always complicated due to security and regulatory compliance concerns. When it comes to getting products to the final distribution point – the customer or patient – big data and technology are having significant effects. Companies like Eaze and GreenRush offer web and mobile apps that enable people to choose their marijuana products and have those products delivered directly to them.
You might not instantly think that marijuana delivery and big data go together, but think again. Eaze captures data related to customers’ locations, products purchased, time spent considering each product, amount of time items were placed in the shopping cart before being removed, and much more. The company analyzes all of the data it collects and uses artificial intelligence, predictive analytics, and machine learning to put the information into usable formats for its clients.
Many companies use the data Eaze collects for marketing purposes – to target consumers with specific product messages, to create special offers, to develop new products, and more. The company helps businesses understand who their customers are and how those customers use their products. This data enables the businesses to develop better products and increase the return on their marketing investments.
3. Big Data Reduces Risk by Optimizing the Decision-Making Process
Today, big data is critical to decision-making in the cannabis industry. Having access to real-time intelligence can mean the difference between success and failure in this fast-moving marketplace. Technology platforms like Headset track inventories, consumer data, and market trends from millions of data points. Using artificial intelligence and predictive analytics, the platforms turn the data into meaningful information that clients can quickly access.
Companies use the data available in these platforms to analyze inventory trends, reordering, items sold per transaction, number of items sold per budtender, transaction totals, grow cycles, production schedules, packaging needs, staffing requirements, product launches, market share, sales projections, wholesale prices, consumer trends, consumer behaviors, consumer spending, healthcare trends, and more. The data can also be used to analyze competitor brands, competitor product releases, and competitor prices.
Having access to this kind of data helps marijuana business communications, spending, and decision-making, but it does even more than that. It also helps these businesses stay ahead of the competition and gain measurable market advantages.
For example, subscribers to the Cannabiz Media License Database can optimize the ROI of their email marketing campaigns using the built-in performance optimization tools that are powered by data and artificial intelligence.
RELATED: Listen to the Cannabiz Media Cannacurio Podcast with Justin Mayhall of Biotrack to learn how Cannalytics from Helix Biotrack helps cannabis businesses make intelligent business decisions with a mix of data analysis and machine learning algorithms.
Big data also plays a role for investors who can use the artificial intelligence from VantagePoint to predict the cannabis stock market, identify patterns, and make less risky forecasts and investment decisions.
From a business risk perspective, cannabis companies use artificial intelligence, predictive data, and machine learning technology from companies like Adherence Compliance to analyze compliance data and predict where marijuana license holders are most likely to fail. This enables them to make critical decisions in advance in order to mitigate those risks.
4. Big Data Improves Efficiency and Revenue
A number of technology companies are developing solutions to improve operational efficiencies so cannabis businesses can streamline and automate processes and increase revenue. Several tech companies that offer solutions to cultivators have gotten a lot of attention over the past couple of years, including Motorleaf, which tracks the growth rate of cannabis plants using artificial intelligence.
The GrowLife system uses data and artificial intelligence to automatically make changes based on growing conditions to reduce the cost of production and the risk of over-supply. At urban-gro, big data is processed at scale using its Soleil Technologies solution. Through predictive metrics, cultivators can make quick and better decisions that lead to improved crop outcomes.
Canada’s Wayland Group provides an integrated platform to cultivators that uses predictive data, artificial intelligence, and automation for environmental monitoring and building management. The result is improved asset utilization, fewer employees, shorter time-to-market, higher yield crops, and lower costs.
5. Big Data Improves the Customer Experience
In addition to its efforts related to product development discussed in #1, GCAC has taken steps to improve the customer experience in the cannabis industry using data and artificial intelligence. Last year, GCAC announced it would launch Sanna, which is an artificial intelligence chatbot that patients use to obtain information and recommendations related to medical marijuana. The artificial intelligence, machine learning, and natural language processing built into Sanna enable it to accurately analyze symptoms and treatment plans.
Other chatbots, like Cannbot, connect dispensaries with patients and customers. Using artificial intelligence, the chatbot can help answer consumer questions and allow the dispensary to obtain valuable data to improve sales.
Customer experiences can also be improved with the PotBot mobile app from Potbiotics, which uses artificial intelligence to sort through more than 30,000 cannabis strains, read peer-reviewed medical journals to analyze studies on cannabinoids, and match that information with up to 37 symptoms (such as cancer, asthma, and insomnia) to identify which strain is best to treat each specific condition.
Key Takeaways about the Effects of Big Data and Technology on the Cannabis Industry
Data and technology can predict the direction the industry is going in and what consumers will want next. Outside of the marijuana industry, small and large companies around the world already rely on data to make decisions in all aspects of company operations.
It’s not surprising that the importance of data has been recognized in the cannabis industry. As a result, new technology companies are opening in the cannabis space and traditionally non-cannabis companies are extending their brands to the industry.
However, all data is not created equal. The challenge is collecting, standardizing, and analyzing data that is highly reliable and relevant. In addition, the people using the data to make critical business decisions need to know what questions to ask in order to fully use the data available to them and leverage the power of artificial intelligence and machine learning. It all starts with quality data.
Bottom-line, companies that have access to real-time business intelligence and reliable predictive insights are better positioned to mitigate risks from all sources and increase revenue and profits. This data-driven intelligence will enable the companies that invest in it to gain valuable insights about what consumers truly want and need from cannabis brands. Ultimately, big data and technology can improve the overall customer experience, which leads to sustainable growth for any company that is wise enough to start prioritizing, collecting, and using it today.
Originally published 6/18/18. Updated 7/24/20.
Susan Gunelius, Lead Analyst for Cannabiz Media and author of Marijuana Licensing Reference Guide: 2017 Edition, is also President & CEO of KeySplash Creative, Inc., a marketing communications company offering, copywriting, content marketing, email marketing, social media marketing, and strategic branding services. She spent the first half of her 25-year career directing marketing programs for AT&T and HSBC. Today, her clients include household brands like Citigroup, Cox Communications, Intuit, and more as well as small businesses around the world. She has been working with clients in the cannabis industry since 2015. Susan has written 11 marketing-related books, including the highly popular Content Marketing for Dummies, 30-Minute Social Media Marketing, Kick-ass Copywriting in 10 Easy Steps, The Ultimate Guide to Email Marketing, and she is a popular marketing and branding keynote speaker. She is also a Certified Career Coach and Founder and Editor in Chief of Women on Business, an award-winning blog for business women. Susan holds a B.S. in marketing and an M.B.A in management and strategy.
Source: https://cannabiz.media/the-effects-of-big-data-and-technology-on-the-marijuana-industry/
