By Dmitri Sharov
Regardless of industry, companies that secure a large market share and earn consumer loyalty never take their success for granted. Successful entrepreneurs and fortune 500 CEOs are always looking for new ways to innovate and increase their efficiency — regardless of their past success. Companies that are not capable of adapting to new ways of doing business nor able to ‘kill their darlings’ are always at risk of being left behind.
DankStop is an e-commerce hub for cannabis accessories with a classic startup story. With over 600,000 online orders, a strong social media presence, and a large inventory of bongs, pipes, dab rigs, vaporizers, & other accessories, DankStop is poised to continue innovating the online cannabis accessory market. Especially now, as a part of the High Tide family, we are excited to see what DankStop has in store for the future.
The DankStop team’s journey is a clinic on how to effectively respond to new market dynamics and change their business in order to find initial success as well as maintain it. From early victories to eventual roadblocks to finding product-market fit to an impressive exit, the story of DankStop is one that any entrepreneur could learn from.
In 2014, DankStop was founded by two college friends immediately after graduating with only $200. DankStop originally started as an e-commerce platform that began selling its own branded accessories. As an early adopter of social media marketing techniques, meme-worthy content, and disruptive SEO strategies, DankStop was able to find quick success.
As most brands, across all industries, were not yet taking advantage of the plethora of influencer marketing, social media advertising, and content marketing opportunities available to them, DankStop was able to make its brand stand out. Of course, DankStop was able to convert its social media following, garnered by its content, into actual customers due to its site’s deep roster of cannabis accessories and seamless user experience. In addition to investing time and resources into their content game, the DankStop team invested a lot of time and resources into their e-commerce platform making sure that it would convert the new eyeballs into sales. This focus on their core business, as well as their marketing strategies, allowed DankStop to make money from their SEO, social media, and online marketing tactics.
However, in 2020 DankStop made the strategic decision to pivot away from the e-commerce buy, sell, and ship business to a dropship marketplace model. DankStop shifted about 80% of its volume out of its own warehouse and into the third-party warehouses of its suppliers. The team had this idea back in 2017-2018 when they realized they were incurring costs and labor on behalf of their suppliers. However, at that time, many suppliers were not keen on transitioning to that model. This changed, of course, as Covid-19 shut down many retail stores and warehouses, finally incentivizing these suppliers to find new ways to reach their customers online.
With the decision to minimize expenses by moving to a dropship model, the DankStop team was able to grow their business and increase their profits drastically. This newfound success could not have come to fruition if the DankStop founders were emotionally attached to their old business model and in-house products. Ultimately, despite finding previous success, the DankStop team’s willingness to pivot allowed them to find more success in the long run. Further, this decision helped enable the company to be in a position to get acquired by High Tide.
Having only integrated about 3000 out of 1000 available products from their supplier catalog, we are excited to see how DankStop continues to grow in the future.