Cayuga Hospitality Consultants Conference: Growing Relationship Between Cannabis and Hospitality
During our Annual Cayuga Hospitality Consultants Conference in November 2024, Tyler Jacobson of 4B Marketing and Hybrid Marketing Co. presented cannabis usage trends from a recent survey and discussed their connection to the travel industry.
As cannabis legalization continues to expand across the United States—now reaching 38 states in some capacity—the implications for the hospitality industry are both nuanced and evolving. While cannabis tourism was once a significant driver for travel to states like Colorado, Washington, and California, the novelty has waned as legalization spreads.
This decentralization means travelers no longer need to cross state lines for access. Instead, cannabis use is becoming more localized, shifting its role from a travel motivator to an amenity or convenience factor for hotel guests.
Opportunities for Cannabis-Aware Hotels
For hotels, this change presents an opportunity—not necessarily to become cannabis-friendly establishments but to be cannabis-aware. Guests visiting legal cannabis states often look for dispensaries nearby, and having recommendations on hand or general awareness of local options can enhance the guest experience.
In some cases, hotels have even partnered with dispensaries for advertising. For example, a hotel in Oregon once featured dispensary advertisements on its key cards—a bold move, albeit one potentially complicated by local regulations. Whether through partnerships or subtle inclusions in SEO strategies, such as listing nearby dispensaries on hotel websites, hotels can provide added value to cannabis-curious guests without explicitly branding themselves as cannabis-focused.
Understanding Guest Behavior and Location Impact
Understanding guest demographics and behavior is crucial in navigating this space. 52.7% of people prefer to bring their own cannabis rather than purchasing it at the destination. Still, many cannabis consumers are impulsive in their searches, often looking for dispensaries after arriving at their destination—be it their hotel, a restaurant, or the airport.
This behavior underscores the importance of proximity and convenience. A dispensary located on a high-traffic road, even if only a quarter as busy as the area’s average thoroughfare, can attract double the foot traffic due to ease of access. Hotels near dispensaries or areas with a high density of cannabis retail locations may inadvertently gain an advantage in attracting this audience, though this requires thoughtful planning and execution.
Operational Considerations for Hotels
From a hospitality perspective, the rise of cannabis as a normalized product also raises operational considerations. While no hotel wants its rooms saturated with the odor of cannabis smoke, there are other avenues to cater to this market. For instance, offering designated outdoor smoking areas equipped with air filters or heaters could provide a comfortable and discreet solution for guests. Beyond smoking, the growing popularity of cannabis edibles and drinkables opens another avenue for hotels. Low-dose cannabis beverages, for example, are emerging as a social alternative to alcohol and could potentially complement existing bar offerings, especially in markets where regulations permit such sales. CBD-based beverages, which lack THC and are non-intoxicating, are another trend gaining traction, even in states without legalized recreational cannabis.
Challenges in the Cannabis Industry
Despite these opportunities, cannabis remains a challenging and heavily regulated market. Many dispensaries struggle to sustain operations due to oversaturation, high startup costs, and regulatory burdens. In mature markets, competition is fierce, requiring dispensaries to not only secure licenses but also invest heavily in marketing and customer acquisition. Additionally, federal restrictions, such as the inability to deduct business expenses under the IRS’s 280E provision, further strain profit margins. Hotels aiming to collaborate with dispensaries or integrate cannabis into their marketing strategies must navigate these complexities carefully.
Balancing Cannabis with Hospitality
Ultimately, the evolving relationship between cannabis and hospitality is about finding balance. Hotels don’t need to embrace cannabis culture to benefit from its presence fully, but recognizing its role in the travel experience is key. Whether it’s providing local knowledge, building partnerships, or simply adapting operational practices to accommodate cannabis consumers, hotels that adopt a thoughtful approach will be better positioned to meet the needs of this growing demographic.
About Cayuga Hospitality Consultants
Cayuga Hospitality Consultants is a global network of independent consultants focused on the hospitality industry. Consultants are available to work independently on assignments or can be organized as a team or task force to achieve the greatest possible results for our clients. Areas of expertise include operations, sales, marketing, finance, asset management, development, technology, insurance, litigation and sustainability for all areas of hospitality, including hotels/resorts, spas/clubs, restaurants/bars, and casinos. Consultants' goals are to provide practical, profit-oriented advisory services across a broad range of hospitality property types and business models plus hands-on support implementing their recommendations.
For more information, view their hospitality consulting services or follow them on LinkedIn.
