Key takeaways
- Google bars ads that promote THC, so a dispensary cost-per-lead benchmark from Google Ads describes some other business.
- Count the discount you fund as part of the cost, not just the placement fee.
- Because cannabis is a repeat purchase, cost per returning customer tells you more than cost per first visit.
- 4/20 and holiday deals bring the least loyal shoppers of the year, so judge those weeks on their own.
There is no reliable Google Ads cost per lead for a dispensary, because Google's dangerous products policy bars ads that promote THC (Google's policy), and Meta's drugs policy does the same (Meta's policy). Any benchmark you are shown came from another business. The number worth knowing is your cost per new customer on the channels you can pay for.
Cost per lead vs cost per new customer
A lead is someone who showed interest; a new customer is someone your POS rang up. Only the second pays the rent, and for a dispensary the gap between them is wide.
Here is what each term means behind a dispensary counter:
Lead : A pre-order, a call, a click for directions, a view of your listing on a menu platform or a sign-up from your site. Cheap to count, and most platforms count it generously.
New customer : A first purchase in your POS that you can tie to a source, through a promo code, a source field at loyalty sign-up or the question "how did you hear about us?"
Returning customer : A new customer who buys again within a set window, such as 60 days. This is where a dispensary's money is, because a regular's visits over a year are worth many times their first basket.
A source that produces cheap leads and few returning customers is expensive, however good its dashboard looks.
From cost per lead to cost per booked new customer
- Leads you pay for Where it leaks: Spam and wrong numbers
- Real inquiries Where it leaks: Calls nobody answers
- Conversations Where it leaks: Quoted, never followed up
- Booked new customer Your real number: cost per booked new customer
Calculating your number
- Choose one channel and one month. A single menu placement or deal listing, measured over a normal month rather than the 4/20 or holiday rush.
- Total the full cost. Add the placement fee, the value of any discount you funded for those shoppers, and staff time spent on creative and deal setup.
- Count first purchases from it. Use the POS source field, the loyalty sign-up source or a promo code that only that channel carries.
- Divide cost by first purchases. That is your cost per new customer for the channel.
- Count who came back. Check how many of those customers bought again within 60 days, and divide the same cost by that count.
- Compare against margin, not revenue. Pull what an average regular brings in gross margin over a year, and see whether either number still fits.
An example with round, hypothetical numbers. Say you test two placements in the same month, each costing $1,200 once the discount you funded is added in.
| Placement A: one-day doorbuster | Placement B: first-visit offer with loyalty sign-up | |
|---|---|---|
| First purchases | 80 | 40 |
| Cost per new customer | $15 | $30 |
| Came back within 60 days | 8 | 16 |
| Cost per returning customer | $150 | $75 |
Placement A wins the dashboard. Placement B wins the business, because it delivers twice as many regulars for the same money. These numbers are an illustration, not a benchmark. Run your own.
Why costs rise around 4/20, holidays and new product drops
Costs rise in those weeks because every store near you runs its deepest deals at the same time, chasing the same shoppers.
Three things happen at once. The discounts you fund get bigger, so the hidden part of your cost grows. The shoppers those discounts attract are the least loyal of the year, so fewer of them come back. And the counter is so busy that loyalty sign-ups get skipped, which breaks the tracking you need to judge the week at all.
New product drops behave differently. A drop that your regulars have been waiting for costs little to promote, because your own list does the work. A drop announced only through paid placements brings in brand shoppers who may follow the brand to the next store.
Judge peak weeks as their own cohort. If 4/20 customers return at half the rate of a normal month's, that is not a failing channel; it is the season.
Lowering cost per new customer
Lower it by wasting fewer of the visits you already pay for, then by leaning on channels with no placement fee.
- Enroll every first-time customer. Make loyalty sign-up part of the first transaction, so a deal visit can become a second visit.
- Keep the menu honest. A shopper who drives over for an item the menu showed in stock and the shelf doesn't have is a paid visit lost.
- Confirm pre-orders quickly. A ready-for-pickup message keeps the order you paid to win.
- Build the free channels. A complete Google profile and a crawlable menu on your domain bring first-time customers with no fee attached. The SEO guide for dispensaries covers that work.
- Win back lapsed regulars first. A customer your POS shows has stopped visiting costs less to bring back than a stranger costs to win. The repeat customer guide shows how.
How VETS Growth Marketing helps
We set up the source tracking your POS needs, then calculate cost per new customer and cost per returning customer for every channel your dispensary pays for. You see which placements to keep before 4/20, not after. The work runs as a project with a date, in accounts that stay in your name, and we report in customers who return. Book a growth consultation and we will compare your channels with you.
Sources
- Dangerous products or services policy, Google Advertising Policies Help
- Advertising Standards: Drugs and pharmaceuticals, Meta Transparency Center