The legal cannabis industry is a highly-regulated, rapidly-evolving space. Sales of the substance for recreational use have only become legal in a select few states within the last decade, and it’s still completely illegal at the federal level.
For cannabis dispensary owners in 12 of those states, Denver-based Flowhub, which recently raised a $23 million Series A funding round, provides a crucial tool to run their operations. The company offers a platform that consolidates the management of complex compliance mandates, security, supply chain data, sales transactions, inventory, and reporting into one system.
But each state has its own distinct regulatory structure to govern the fledgling industry, and that means Flowhub faces the challenge of providing cannabis entrepreneurs with a solution critical to their business’s success that can also meet their unique compliance needs. That’s why Flowhub uses Pendo as its “digital communicator.”
The software’s ability to collect usage data from segments of users allows Flowhub to target specific customers at the state level with messages relevant to their individual market. Since those messages reach users right in the app when they’re actively using it, engagement is much higher than using emails, which are often missed or ignored.
Pendo’s ability to report usage across applications lets Flowhub get a holistic, eagle-eye view of what users are doing across their entire system, from their web-based point-of-sales software to their mobile app. When power users of certain features are identified, the team can approach them with in-app surveys to obtain detailed feedback.
Having that insight allows for more data-driven conversations and easier prioritization of which projects and features to pursue, driving faster innovation at Flowhub in a fast-paced industry. This is critical for a company that often rolls out new features on a state-by-state basis. If the data shows that a feature is doing well in the state where it’s first released, it might make sense to scale it out to additional markets and other states.
For example, the team was surprised to learn that consumers at Colorado dispensaries are three times more likely to join a loyalty reward program compared to California or Oklahoma consumers.
“This allows us to continually optimize our platform and bring new enhancements to market that will actually serve our customers in the way they need,” says Nico Lewis, a product manager at Flowhub.
Pendo’s in-app guidance features also allow Flowhub to refine the user experience, automatically serving up custom guides, walkthroughs, and tips right in the app. When users are underutilizing or using features in unintended ways, Flowhub uses Pendo to help nudge them onto the right course of action. When new features are released or others are improved, in-app messaging provides the details on how they’ve changed and how to use them.
That means there’s no need to involve support teams or coordinate a development release event—all the information is automatically pushed to the users through Pendo, empowering them to self-service as needed.
“The cannabis industry is still new and evolving and there can be a steep learning curve for many of our dispensary customers who are coming to this industry without a lot of cannabis experience,” says Lewis.