An on-demand weed delivery service has just become the very first of its kind to get an app on the Apple Store. Eaze was founded in 2014 as a marketplace for cannabis products that people can purchase and have delivered to their homes on-demand. Now, it’s taking the tech world by a storm. Eaze, like other entities, did technically have an app before, but only to browse on. To actually purchase anything, you’d be redirected to the website, which is a clunky experience and kind of a pain. Now, the full, complete transaction can happen through the app. The company’s vice president, Elizabeth Ashford, says the change is extremely meaningful. “What’s meaningful about it is that Apple changed their terms in early June, and we were first to market to have full e-commerce functionality.” Ashford says Apple’s change in approach to cannabis and cannabis apps is a big deal. Still, she views this as an inevitable progression in the cannabis industry and in commerce. “Prior to Apple making this shift in terms, you saw Amazon changing their testing requirements and saying they would be open to delivery. Uber saying that. It’s just a trend, and I think though Apple and the app store really do function as gatekeepers for commerce. So their shift has a really immediate, material impact on the legal industry. That’s really the important part of it. Obviously I’m thrilled that we’re first out of the gate on it, but I also think it’s a great sign for the industry that you have Apple, Uber, Amazon talking about it.” This isn’t just a big deal for the company itself; it’s a win for social equity programs. “I think we have one of the best programs in the industry, in the nation, to elevate social equity brands,” said Ashford. Eaze has a menu specifically for social equity brands and has sold close to $7 million in products from those brands since the menu was launched in 2019. It also has a business-accelerator program called Momentum that helps social equity applicants get off the ground by giving grants. “The platform is doing a lot of broad good. What it really does is, it puts a wide variety of products in front of consumers and lets consumers decide. And we see a lot of interest and a growing interest in brands produced by business people who were personally hurt by the War on Drugs. We’re very proud of that.” Eaze has already been extremely successful as a website. They’ve completed 7 million deliveries to date and have 2 million registered customers. But the goal isn’t to edge out the competition or impede brick-and-mortar retailers. “Our position is that there is room for a lot of different proprietors in this space,” said Ashford. “Our perception of that is that a rising tide raises all boats for the industry. In terms of competition, we are the largest delivery network in California – and by extension, the United States – but our framework for how we operate is not to minimize or inhibit retailers who are also doing this. I think we want to get the word out as broadly as possible.” Really, Ashford says, the goal is access. California has nearly 40 million people, but there are cannabis deserts throughout the state. Yet the majority of people, even if they aren’t medical patients, cite medical reasons for why they use cannabis, like insomnia, chronic pain, and anxiety. “Certainly cannabis has had the largest – in a sense – human trial of any medicine in human history. Thousands of years of people using it to treat human conditions is really the proof of that. When we think about it as a company, we don’t make huge distinctions between what’s a medical product and what’s an adult-use product. If you’re using it, and you’re using it to make yourself feel better and you’re using it to treat a condition, or even to bring about relief from biproducts of other medications you’re taking – all of that falls largely into the medical bucket.” Access allows people to make their own decisions as adults for how they want to treat their own conditions. The news about the app follows an incredibly successful year for Eaze. Like other delivery businesses, Eaze did great during the pandemic. First-time deliveries, new sign-ups the volume of orders, and total order value were all up in 2020. This isn’t the first time Eaze has redesigned its operation. “Eaze’s business model up until late 2018 is that we were really sort of a platform that connected independently-owned retailers with customers,” explained Ashford. Some of those would have been dispensaries with store fronts, some of them were not. “We would contact the retailer and they would get it to the doorstep.” So for the consumer, it would feel like they were buying from Eaze. In reality, you’d be buying from the dispensary or cannabis provider. They decided to change that business model and opt for vertical integration. They made the switch in February of 2020 after a $20 million investment. “We started to either become partners or sole proprietors on the retail license. That means we shifted to a vertically-integrated model where we own and operate the retailer function and license, as well as doing the fulfilment through delivery,” explained Ashford. 2019 was a bad year for cannabis. There as a huge crunch in capital. Even still, Eaze was able to boast a 97% annual increase in new sign-ups and a 74% increase in first-time deliveries. Their overall deliveries increased by 71% and they doubled their customers over the age of 50. But the business’s leaders figured it was time for a change. “It was just a function of what was going to be viable in the longer run for the company,” said Ashford. “And honestly, it’s just a lot more efficient to own the operations side of it as well.” In California, the licenses for people cultivating marijuana and the people selling it are separate. Eaze created a subsidiary called Stachs that handles fulfilment. The company is careful to verify that people are over 21 when they make an account, and that they are who they say they are. You have to provide photos of the front and back of your ID, which is matched with a photo of your face that you submit. You also have to present your ID when your purchase is delivered to re-verify your identity. It’s a win for the brands involved, too, because they can reach a broader base of consumers. Eaze delivers to 85% of the state of California, so brands aren’t limited by the number of individual dispensaries they can convince to carry their product. Later in July, Eaze is expanding into the state of Michigan. It’ll be operational in Ann Abor, Detroit, and Grand Rapids. “Michigan has a robust adult use market, that’s growing exponentially,” said Ashford. “For delivery, the sate regulations and local regulations are very favorable.” The adult use market in Michigan is exploding and its medical market is already robust. “Obviously, more and more major markets are both coming online and maturing, and so we’re going to be looking at those as it happens, but it has to be both a sizeable market and one that’s conducive to delivery, because obviously that’s our model.”
Eaze Becomes First Weed Shopping Platform on App Store
We spoke to Eaze's vice president about what this means for the company.
July 16, 2021 | Industry |
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