Case Study: Increasing Average Basket Value Through a Loyalty Program

Industry: Cannabis Retail Primary KPI: Average Basket Value (ABV)

Objective: Increase revenue and ABV in a highly regulated retail environment

The Challenge

This cannabis retailer was facing flat basket sizes and limited customer retention opportunities. With no existing loyalty program in place, the business lacked a structured way to reward repeat customers, influence purchasing behavior, or increase visit value. Any solution also needed to comply fully with provincial and federal cannabis regulations in Canada.

The Strategy

We designed and launched a fully compliant loyalty program built specifically for the realities of cannabis retail. The program focused on rewarding frequency and engagement without incentivizing overconsumption, while still driving meaningful revenue impact.

Key tactics included:

• Designing a compliant loyalty program aligned with provincial and federal cannabis regulations

• Structuring rewards to encourage repeat visits, higher basket values, and sustained program participation

• Rolling out the program to existing customers with a strong emphasis on fast adoption

• Developing a full suite of marketing assets to support launch and ongoing engagement, including in-store signage, print materials, website content, email campaigns, and automated email flows

• Training staff and equipping them with clear messaging to promote the program at point of sale

The goal was not just sign-ups, but long-term loyalty penetration and behavioural change.

The Results

The impact was immediate and long-lasting.

Average basket value increased significantly among loyalty members in the first year of the program and continued to grow into year two. Loyal customers consistently outperformed non-loyal customers, demonstrating higher spend per visit and sustained engagement over time.

These results clearly illustrate the revenue power of a well-designed loyalty program and its ability to drive measurable retail growth in a regulated industry.

The Takeaway

Loyalty programs are not just retention tools. When designed strategically and executed properly, they are powerful revenue drivers. This case proves that even in one of Canada’s most regulated retail environments, loyalty programs can meaningfully increase basket value, customer engagement, and long-term profitability.