KPI #5: New Customer Review Rate

Your dispensary's New Customer Review Rate is a vital metric that measures how effectively you convert first-time customers into business advocates. Based on our analysis of single-store, multi-store, and multi-state dispensaries across the United States, this key performance indicator directly impacts your local search visibility and customer acquisition costs.

New Customer Review Rate measures the percentage of first-time customer orders from online reviews. For example, if your dispensary serves 100 new customers monthly and receives 20 reviews from these first-time visitors, your New Customer Review Rate is 20% (20/100 = 20%).

Based on our proprietary BNCHMRK dataset, here's how we categorize dispensary New Customer Review Rate performance:

• Great: New Customer Review Rate ≥ 2.5%

• Average: New Customer Review Rate between 1% and 2.5%

• Needs Improvement: New Customer Review Rate < 1%

Author Note: this target will evolve as our dataset grows. Based on market maturity, local competition, customer demographics, and review generation strategies, individual review rates can vary.

Our latest data from October 2024 shows significant variations in New Customer Review Rates across dispensaries in our dataset. We currently have data from dispensaries in 9 U.S. markets. Below is the performance distribution by percentage:

Dispensary Performance Distribution

• Dispensaries Scoring 'Great': 37.5% of dispensaries scored in this range with an average New Customer Review Rate of 6.8%

• Dispensaries Scoring 'Average': 50% of dispensaries scored in this range with an average New Customer Review Rate of 5.7%

• Dispensaries Scoring 'Needs Improvement': 12.5% of dispensaries scored in this range with an average New Customer Review Rate of .49%

To accurately calculate your dispensary's New Customer Review Rate, follow these steps:

#1. Track New Customer Reviews

• Monitor reviews across all platforms (Google, Weedmaps, Leafly, etc.)

• Verify review authenticity

• Note review timestamps

• Match reviews to customer visit dates

#2. Count New Customer Orders

• Include all first-time purchases

• Track across all sales channels

• Exclude repeat customers

• Account for delivery and pickup orders

#3. Formula

New Customer Review Rate = (Number of New Customer Reviews / Total New Customer Orders) × 100

Several key factors influence your dispensary's New Customer Review Rate:

Market-Specific Variables

Competition Density

The number of dispensaries in your area can impact how willing customers are to leave reviews. Successful dispensaries stand out by focusing on strategies like unique product selection, competitive pricing, and personalized service.

Local Customer Behavior

Demographics, cultural factors, and local habits influence review behavior. Understanding your local market helps in tailoring review generation strategies.

Market Maturity

• New Markets: Emphasis on education and trust-building. Encourage first-time buyers to share their experiences.

• Growing Markets: Enhanced feedback collection and differentiation through service quality.

• Mature Markets: Advanced review systems and strategic response protocols help maintain high review rates.

Operational Factors

Customer Experience Quality

A positive customer experience drives higher review rates:

• Staff Interaction Quality: Ensure staff provide exceptional service to create memorable first impressions.

• Store Environment: Optimize store layout and atmosphere to enhance customer comfort.

• Service Efficiency: Reduce wait times and provide seamless checkout experiences.

Review Collection Process

An effective review collection process helps boost New Customer Review Rates:

• Timing of Review Requests: Request reviews soon after the customer interaction while the experience is fresh.

• Method of Solicitation: Use a mix of automated messages and in-person requests.

• Incentive Programs: Offer rewards or discounts for leaving a review, ensuring compliance with platform policies.

Platform Management

Managing review platforms effectively ensures that reviews are visible and impactful:

• Response Protocols: Respond to reviews promptly and thoughtfully.

• Monitor Frequency: Regularly monitor reviews to address concerns and celebrate positive feedback.

• Review Verification: Verify and manage reviews to ensure authenticity and relevance.

Based on our experience working with dispensaries across multiple markets, we see several key areas that drive improvements in New Customer Review Rate performance:

Customer Experience Enhancement

Staff Training Programs

• Educate staff on the importance of reviews and how to encourage them during customer interactions.

Environment Optimization

• Create a welcoming environment that encourages customers to share their experiences.

Service Standardization

• Ensure that all customers receive a consistently high level of service.

Review Generation Strategy

Automated Review Requests

• Use SMS or email to request reviews after a customer's first visit.

Staff Involvement

• Train staff to ask for reviews in a natural and friendly manner.

Incentive Programs

• Offer discounts or points for reviews, but ensure incentives align with review platform guidelines.

Response Management

Quick Response Times

• Respond to reviews promptly to show customers that their feedback is valued.

Personalized Replies

• Personalize responses to reviews to build a stronger connection with customers.

Follow-Up Procedures

• Address any issues raised in reviews and follow up to resolve concerns.

Implementation Framework

Assessment

• Current performance review

• Challenge identification

• Resource evaluation

• Process documentation

• Competition analysis

Strategy Development

• Goal setting

• Resource allocation

• Timeline creation

• Staff training plans

• Technology selection

Execution Management

• Performance monitoring

• Team feedback collection

• Strategy adjustment

• Success recognition

• Continuous improvement

• Overall Review Rate

• Customer Return Rate

• Customer Satisfaction Score (CSAT)

• Net Promoter Score (NPS)

• Review Response Rate

• BNCHMRK Monthly Reports: Access the latest insights on dispensary performance.

• Marketing Performance Scorecard: Get your free BNCHMRK scorecard to assess your marketing efficiency.

• Consultation with Growth Experts: Schedule a free consultation with one of our cannabis growth experts for personalized advice.

What is a good New Customer Review Rate for a dispensary?

A good New Customer Review Rate is 2.5% or higher, meaning 2.5% of first-time customers leave a review. Our data shows top-performing dispensaries achieve rates of over 12%, while the dataset average is 3.6%.

How do you calculate New Customer Review Rate for a dispensary?

Calculate by dividing the number of reviews from new customers by the total number of new customer orders, then multiply by 100. For example, if you receive 30 reviews from 100 new customers, your rate is 30% (30/100 × 100 = 30%).

Which review platforms should I focus on?

Focus on Google Business Profile first, then Yelp and other industry-specific platforms like Weedmaps and Leafly. Based on your market's preferences, consider local review sites.

How often should I calculate my dispensary's New Customer Review Rate?

Track this metric monthly to identify trends and adjust strategies. Also, quarterly and annual rates should be calculated to account for seasonal variations and long-term patterns.