4 Things You Need to Know About Marketing Brands in the Cannabis Industry

In branding, cannabis industry by Nicole Flanigan

Every month, more states move to legalize cannabis. As more states push for legalization, more and more opportunities are blossoming for brands and sellers to market cannabis to a much broader audience. But as cannabis innovation (such as new products, distribution methods, and growing practices) expands and evolves in legal states like Washington and Colorado where cannabis is legal and readily available, tech and advertising platforms aren’t just magically open for business. Here are 4 crucial pieces of information on marketing cannabis brands. 

During a panel at South by Southwest on the subject of technology in the cannabis industry, it became crystal clear that there are a ton of hurdles to jump while marketing cannabis. The 3 biggest digital giants (Facebook, Instagram, and Google) have all started cracking down heavily on cannabis brands, even in the states where cannabis is legal.

Cy Scott, CEO, and co-founder of Headset, an analytics company that works with cannabis brands to provide sales data said “Operators like Facebook, Instagram are pulling accounts all the time or Facebook won’t even let you start advertising. It’s worse than alcohol or tobacco—you see beer commercials all the time [where] everyone looks like they’re having a good time and enjoying alcohol, but you don’t see that with cannabis.”

Digital Ads

While digital ads are a viable option for most industries and should be run when appropriate in the cannabis space, it isn’t always possible to run digital ads that perform specific functions. Challenger and startup companies are working hard to build their brands with digital ads, but how are cannabis marketers supposed to do the same when Google is against cannabis?

The answer is to focus harder on other forms of ads and run what you can digitally. You have your website, which is one of the best tools you have for any marketing, and in the cannabis industry, print ads are proving to be very popular. In-house, many dispensaries and other cannabis brands are opting to use iPads in their stores to capture crucial customer data that will help them find more ways to advertise.

Brand Loyalty

In other industries, it isn’t uncommon for the big brands to chase and acquire the small brands. Craft beer, for example, is being adopted by many big brands as consumer tastes are changing. However, a challenge for these big brands is that it’s difficult to build brand loyalty when craft beer consumers have a million choices and want to try multiple flavors. Cannabis is becoming more mainstream, and it should be looked at as an opportunity to for weed brands to capitalize on that challenge and win over consumers with better products.

Morgan Paxhia, managing director of Poseidon Asset Management, an investment firm that specializes in cannabis said “There is still a massive need in the logistics and infrastructure need to power these large-platform brands. When you post cultivation, there still is a tremendous amount of work before that gets to the final market, and I think there’s a lot of innovation that can happen in that vertical.”

In-Store Experiences

Another great way to create a buzz for your cannabis business is to offer in-store demo days where customers can learn about the products you have available in your retail store or dispensary. Running these demonstrations can help you analyze how much of an interest your consumers have in your products based on the sales on the demo day and subsequent days. This data is also useful for helping you find which products will be better for your store and what you should spend time ordering.

“Measuring marketing can be difficult given the channel, regardless, but given the limited channels and in-store being a primary driver for them, we’ve been able to give them technology to look at their sales numbers at that store as it happens,” Scott said.

Technology in the Store

Advertising will always be a challenge, but cannabis brands are actually getting ahead of traditional retailers who have been using the same POS technology for years. Many cannabis brands are using NFC, mobile payments, text messaging and email programs since they’re easier for the cannabis industry. Cannabis brands get demographic, sales and preference data they can use to build out customer-relationship-management (CRM) databases.

An example would be someone declaring their edible preference over smoking flower. This person could be segmented into their own audience with other individuals who prefer edibles and they could all receive an audience specific offer for a new cannabis chocolate bar.

“Trying to utilize product preferences—the same way that Amazon does a really good job of showing you products that you’re interested in—we try to do the same thing to serve more targeted content,” Milton said.