June 4, 2020
From makeup and clothing to dirt of the month and scavenger hunt tools, monthly subscription boxes are all the rage. Now, cannabis is about to join the ranks of BarkBox, Ipsy, and StitchFix, Forbes magazine reports.
Nugg Club, which is now available in Los Angeles and Orange County (pot has been legal for recreational use since 2016 in California), is owned by parent company NuggMD; which claims to be the nation’s leading cannabis-focused telemedicine platform, with 600,000 patients served.
The subscription boxes, Nugg says, “will deliver full-sized, highly-curated and personalized cannabis products directly to the consumer’s doorstep.”
Each box will cost $99 and contain five to seven products valued at just about $250, according to the company. That price is a lot more expensive than the shop-by-mail containers from Iipsy or BirchBox—but is in line with what most millennials spend at a dispensary, Forbes reports.
According to Headset, an analytics service for the cannabis industry, the average basket in California is $68.70 for a little over two items per basket. Through Nugg Club, the customer is effectively receiving five to seven products for the price of three.
Like other subscription services, the boxes are highly personalized. Customers can select the type of product(s) and strain(s) they want to receive in their box with each month’s selection improving based on their feedback. Not the biggest fan of a particular vape flavor? Leave a comment and never see it again. Still have full products a month after the initial box? Deliveries are available every one, two or three months, Forbes notes.
The new Nugg Club cannabis subscription is participating in a market that grew 890% from April 2014 to 2018, and continues to grow. Around 54% of online shoppers say they are members of a subscription box service. Subscription service customers are more likely to be younger Millennials living in college towns or “hipster” areas, two common characteristics of cannabis consumers. According to Headset, millennials alone contribute to roughly 52% of all cannabis sales in the United States.
This type of service adheres directly to aspects of human psychology – a desire for services that are convenient and bring unique products and experiences into our lives. The simple act of opening a delivery ignites the euphoria and excitement of discovering something new. The consumer doesn’t always know what they are going to find, but it’s always a novel product, and that alone is a huge factor in the success of subscription services. That’s probably part of the reason over half of the subscription market is “subscribe for curation” where consumers are surprised by a variety of different items.
As the box goes to launch, Nugg Club is being mindful that we are in the midst of a pandemic. In response to recent studies that report an uptick in depression, anxiety, and PTSD symptoms among healthcare professionals treating COVID-19 patients, Nugg Club is offering a limited quantity of $1 boxes to qualifying workers.
Research contact: @Forbes