Effective Management of Consumer Data in Your Cannabis Dispensary
The cannabis industry continues to achieve broad-based legitimacy, with 21 states legalizing the recreational use of cannabis. The recent cannabis-friendly regulations have triggered increased investment in the industry. Increased business opportunities in the industry have caused a market rush in consumer engagement, moving products, and achieving profitability by businesses. However, these moves can only be performed by focusing on the relevant consumer privacy and data security risks.
Like other new industries, consumer privacy and data security risks are one of the biggest challenges businesses face. The challenge significantly affects the credibility of a business and whether clients feel safe conducting any transaction with the company. In the US cannabis industry, consumer privacy and data security risks manifest differently across business processing activities and operating systems. If you are running a cannabis dispensary, you interact with consumer data more often than even a regular retail shop. On a typical day, cannabis dispensaries collect visitor I.Ds and track visits and purchases.
Good business practices demand such privacy and security risks to be addressed.
Maximizing data value
For many years, consumer data has proven to be a very efficient tool in business decisions. The legal cannabis industry has continued to experience tremendous growth, and business owners realize the value of the consumer data they have at their disposal. They have also become aware of the multi-directional threats associated with collecting and protecting this data. They are looking for the most effective and secure resources and tools for data protection.
You can use personal data about cannabis consumers to generate high-value insights about consumer behavior and boost the consumer relationship with the business. However, thanks to consumers' freedom, they can limit how much information they are willing to share with the cannabis dispensaries. Of course, there is mandatory information like the presentation of identification documents and medical prescriptions as required by cannabis laws.
Cannabis dispensaries can come up with consumer-based rewards and insights from their collected consumer data. It’s important to note that businesses can only use consumer data after receiving the content from the consumer. When collecting data, it's essential to make a privacy notice available, informing the consumer what data is being collected and how you will use it. It should also state whether the data will be shared with third parties. Your privacy notice should explain how you will protect consumer data from a breach.
The privacy notice is a legal requirement at the federal and state levels. Apart from that, it’s also good customer practice. For instance, "Section 5 of the Federal Trade Commission Act (FTC Act) (15 USC 45) prohibits ''unfair or deceptive acts or practices in or affecting commerce. '' The prohibition applies to all persons engaged in commerce, including banks."
By informing your consumers about the privacy notice, they know the type of data being collected, how you will use the data, who will have access to it, and how you will protect it.
Online hackers are always trying to find ways to access business data. They do this in numerous ways, from holding essential data for ransom to identity theft or selling stolen data. All US states have data breach laws, which generally require businesses to notify individuals who suffer from data breaches or are infiltrated due to security breaches. It’s essential to fully understand the state and federal laws regarding data privacy which guide consumer data of your cannabis customers.
Most hackers will exploit your business operations and process vulnerabilities to achieve data breaches. Frequent monitoring and updating of your business's security systems will protect you from such malicious acts. Your cannabis dispensary needs to provide customers with secure data environments, and your business should have robust incident response plans. Other vital tactics to use that will enhance consumer data privacy include:
Draft, publish, or update the privacy notices
Enhancing customer trust
Limiting data risks
Maximizing data value
Comply with the federal and state regulatory obligations
Even though there have been numerous moves by lawmakers to come up with comprehensive data privacy regulations at the federal level, there has yet to be any success. Nevertheless, the American Data Privacy Protection Act (ADPPA) is the only hope, having made it further in the federal legislative process than any data privacy bill in the past. Other federal laws which govern data privacy and might affect the operations of a cans dispensary include:
The Children's Online Privacy Protection Act (COPPA) governs the collection of information about minors.
The Health Insurance Portability and Accounting Act (HIPAA), which governs the collection of health information
Most of the data privacy laws are at state levels. For instance, the California Privacy Rights Act (CPRA) and Virginia's Consumer Data Protection Act (CDPA) are some of the state laws which govern data privacy.
As you have read in this article it is not as straightforward as other industries. Operating a cannabis business is extremely difficult, and not having the know how can really affect your bottom line. Vende POS is made to help its clients run the business they have always wanted. Providing you with all the necessary tools for your business to succeed is our goal. Schedule a demo with us today and see how running your business on the Vende platform can help.