Brands entering the US cannabis market face a legal labyrinth in that the sale of cannabis products is now legal in 11 states, plus the District of Columbia, but brands are fairly rigorously excluded from traditional forms of advertising.
National TV and digital marketing on platforms such as Twitter and Facebook are out, yet brands are under pressure to compete, or risk falling behind in a strongly growing market.
Figured from market research company Packaged Facts show retail sales of cannabis products, including hemp, in the US grew around 24% to $14.4 billion in 2019.
To beat restrictions, brands are increasingly turning to experiential, event-based marketing, according to Ad Age.
The title describes one solution run by a duo of cannabis entrepreneurs in Northern California who host all-female “garden parties” they describe as “like a Tupperware party, but for cannabis”.
The idea is to create a non-intimidating environment in which potential consumers can learn about the product.
Marketing cannabis, even where legal, is fraught with compliance laws and regulations at every level, from the city, to the state and federal level.
For example, marketers can publicise products at events, but samples and selling cannabis at the same time is normally not allowed.
“In some ways you feel like you are operating in 2008 marketing,” Cory Rothschild, senior VP of brand marketing for Cresco Labs, which owns cannabis brands and dispensaries in 11 states, told Ad Age.
“There is no social advertising, there are no basic six-second pre-roll [ads] on a lot of sites.”
The regulatory burdens are forcing marketers to think outside the box – for example, forming links with non-cannabis brands to reach desired audiences, who are now just as likely to be found in the “wellness” or “foodies” categories, as those looking for recreational use.
Chicago-based Cresco targets foodies with its product, Mindy’s, named after a top pastry chef in the city. And Arizona-based Sunday Goods got around sampling restrictions by handing out empty boxes at an LA Pride event which directed people to a nearby dispensary where its product, promoted on its website as offering “relief from pain”, or a “pathway to creativity” could be bought legally.
Elsewhere, brands are creatively aligning themselves with the greater acceptance of the sale of cannabis, a sector that US investment bank Jefferies Group believes could be worth $130 billion globally by 2029. In Canada, Hershey’s launched its “Oh Henry! 4:25” bar, making use of the cannabis slang term “4:20” to market the perfect antidote for the munchies. (Read more here: Oh Henry!, Pizza Pizza and Wingstop: making money from the munchies.)
Sourced from Ad Age; additoinal content by WARC staff