Marijuana next in online coupon trend

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Jun 21, 2007
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Medical marijuana sellers are joining the online coupon trend, trying to lure new patients with deep discounts on pot, hash, smoking accessories and edible cannabis-infused foods.

Online couponing for marijuana comes as popular mainstream coupon sites turn away dispensaries and other marijuana businesses. In established medical-pot states like Colorado, where as many as 700 dispensaries battle for new patients, online coupons are helping some pot shops draw in business.

Colorado's bills itself as the nation's first successful online pot coupon service. With 10,000 subscribers in three Colorado cities, site founder John Molinare said he's doing better than he hoped. Molinare has a marketing background and has never been in the marijuana business, but last year he looked around at Colorado's proliferating pot industry and decided to copy the Groupon model for dispensaries.

"It's a pretty brilliant idea," Molinare unabashedly said while setting up a booth for this weekend's Mile High Kush Expo, a convention for marijuana patients, growers and business owners. "Groupon's out there doing amazing things, and we just wanted to apply it to the medical marijuana industry."

Molinare hopes to expand to Arizona and California, other states that have legalized medical marijuana.

He's not the only so-called "ganjapreneur" with the coupon idea. A Denver website called The 420 Deal is accepting subscribers in Colorado and Arizona for coming pot coupons, though the site isn't offering deals yet. Colorado dispensary owners say they've fielded several calls in the last few weeks from prospective start-up coupon sites catering to marijuana users.

"I'm hearing these guys out because I like the idea," said Austin Martinson, owner of Denver's Karmaceuticals, which sold 85 coupons earlier this year for the company's signature Karma Karamel Chews. The cannabis-infused candies normally sell for $11 each; patients shopping on paid $9 for two.

Martinson lost money on the candy sale, with half the money going to the coupon site. But Martinson called the coupon a success because it brought in 20 medical marijuana patients who'd never shopped there before.

"It's been one of the more effective ways to get people in," said Martinson, who said his small dispensary can't afford display ads in prominent marijuana publications such as Kush or High Times magazines.

MMJ Daily Deals coupons work just like coupons to restaurants or salons. Interested shoppers see deals on a website, pay online, then print coupons to use in the business.

Dispensary owners say that mainstream couponing sites, including Groupon and LivingSocial, won't accept marijuana businesses. Messages left by The Associated Press with both companies weren't returned.

Martinson said he tried without success to advertise through mainstream sites.

"They pretty much just said they weren't interested in this industry," Martinson said.

Another dispensary owner who offered an MMJ Daily Deals coupon says it's too soon to tell whether online couponing will take hold in the pot business.

Todd Carstens, part owner of three Greenwerkz dispensaries in the Denver area, sold about 50 coupons for deeply discounted marijuana-infused sodas through MMJ Daily Deals. Carstens said that razor-thin profit margins in Colorado's crowded marijuana business make it hard to drop prices even further and drum up new business through an online coupon.

"The coupons, they do work if your deal is good enough and aggressive enough," Carstens said. "But you have to offer such an ultra-aggressive deal that it eats up any profit."

Molinare says he expects more dispensaries — and mainstream couponing sites — to come around to the idea of online pot deals. But he concedes marijuana couponing may stay local because medical marijuana violates federal law.

"It's not for the weak of heart because there are so many issues involved," Molinare said.


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