As growing numbers of brands incorporate cannabis into their products, how are agencies preparing for the legalization of marijuana?
Practically speaking, the first thing agencies will need to do is undergo legal advice, ensuring that no issues for US operations of agencies due to federal prohibition. There is also a need to gain a fundamental understanding of the complex legal frameworks and marketing restrictions and regulations by legal jurisdiction, to enable strategic and creative teams to deliver appropriate solutions. It is a complicated market that is frequently changing with regulations evolving with it.
Then in terms of the companies and brands to partner with, agencies need to beware that there are 1000’s of SMEs, each with a single brand in development, and very few massive companies with a portfolio. It would be wise to not leap in to the first exciting opportunity, but instead scope the market for those companies or people that are likely to be successful with the funds and experience to build great brands and marketing plans. Or companies with meaningful point of differentiation such as Rubicon Organics with their organic super premium bud from British Columbia.
Facebook, Instagram and Google have banned marijuana marketing. What alternatives do you find the most effective to promote marijuana brands and products?
The reason that these companies have restricted paid cannabis advertising is not due to regulations but because of issues with federal legalisation. As expectations in the industry are that federal legalisation in the US could come within 24months, it is worth spending the effort now to find ways to build a social media presence, despite some of the challenges.
We are seeing two divergent routes that marijuana companies are taking to build brands. The first approach is ‘lifestyle advertising’ led, using predominantly image-based media to portray a lifestyle whilst being careful to avoid obvious product placement. This ranges from provocative billboards in legal states through to branded content and organic social media. This route attempts to side-step social media regulations through a series of short term tactics such as paid promotion of social posts from influencers or paid branded content masquerading as news from 3rd party media publishers. They will also look for paid ways to promote the lifestyle of the brand through products not regulated, such as apparel and other merch. Take a look at a brand like Ignite Cannabis and you would be forgiven for thinking that it has taken more than several pages out of the Fyre festival playbook.
The alternative route is to try building a more ‘authentic experience’ brand from the inside-out, led by a strong sense of purpose and a compelling customer experience. This route option requires a more considered strategic approach with a consistent brand experience across touchpoints that adds up to more than the sum of the parts. It is favoured by brands with a diverse product portfolio or a delivery device for consumption, that has a built-in level of repeat usage. This route also creates branded content that can be shared by others in social media, but developed with an audience’s needs in mind, rather than simply to portray a lifestyle or provide shock-value.
The more authentic experience approach may take longer to build awareness, as it gathers momentum over time among a more organically built user base. Yet, this route is more likely to build levels of trust and advocacy and a brand more resilient to future changes in marketing regulations.
How do regulations affect the execution of marketing campaigns and what are the solutions?
Regulations are there for a reason and it is not in the interests of a category for creative agencies to find solutions to try and circumvent them. As with alcohol, it is better to self-regulate to a higher standard and avoid greater calls from the public for even stricter regulations.
In this market, there is an opportunity to find creative approaches that build consumer trust in the category, through brands with a purpose-led desire to help consumers meet their needs. Changing the industry vernacular from weed, cannabis and marijuana to the quality of bud, strains and flowers is a positive move that helps the market mature away from the stoner-label that has existed for decades.
Are there any brands that have an opportunity crossing over into marijuana industry? Is legality the only thing preventing them from embracing it?
There are several brands across food and beverage categories that have already made the move into the marijuana industry (several beer brands), with some big names (soft drinks) in advanced conversations. The big brands are not as interested in chasing media exposure by being first. They are interested in launching when ready to deliver a consistently high-quality product at scale to the right audience. Finding a partner to deliver high-quality at scale is still a challenge at this maturity stage of the market.
There are also challenges in providing customers with a measurable, consistent and predictable level of dosage across all delivery methods, though edibles and liquids provide a significant opportunity to meet this need.
What are some similarities and differences you see between alcohol & tobacco industries and marijuana?
Naturally people draw similarities with tobacco and alcohol, but there are a few significant differences. The first and foremost is the distinction between medicinal and recreational use.
It is too simplistic to refer to CBD as medicinal and THC as recreational. In fact both are used in med and recreation. For example people trying to kick opioids or with advanced stage cancer need the THC to support the pain relief. But we can say that typically CBD is associated with wellness/medical and THC is often used more for recreation.
Versus smoking or alcohol, THC gives users the option to choose different effects based on the strain. This opens up the market to meet vastly different consumer needs and mindsets, such as feeling relaxed, energetic, more sexually aroused or even more creative. In this respect there are as many similarities with functional-drinks and nutraceuticals.
And whilst smoking remains the most preferred method of delivery, edibles and liquids represent the biggest opportunity to grow the market. These more acceptable delivery methods will widen the appeal to more demographics and change attitudes to the industry.
What are your thoughts on involving celebrities into the cannabis campaigns?
Celebrity involvement can have many positive effects on the success of a cannabis brand. This can be as simple as appearing in branded content, such as Lake Bell for MedMen’s online magazine. Right through to a stake in the company, like Willie’s Reserve from Willie Nelson. But this should be approached as more than a very expensive badging exercise. The authenticity of Willie Nelson as an outspoken advocate of cannabis works, especially when combined with his insistence on sourcing from smaller scale farmers. Celebrity ‘owners’ can also be used to open up new markets, such as in the case of TV personalities Whoopi Goldberg and Montel Williams have also made forays into the industry with their brands Whoopi & Maya and Lenitiv Labs. Structuring deals based on percentage uplift in sales, as opposed to an endorsement fee can lead to a longer-lasting, more collaborative and effective relationship between brand and celebrity.
Have you seen the cannabis marketing evolving since legalization first began in the US?
We are still in the nascent stages of cannabis marketing, but many companies are trying to move away from the stereotype of ‘weed brands’ to a more considered positioning in line with new audiences. Medmen are an example of a brand that started out in an era of the stereotypical weed brand, but have more recently invested in high-quality creative execution across touchpoints from stores and branded content through to advertising directed by Spike Jonze. I think we will see this trend continue as consumers become more educated about the industry and become more discerning.