The legal cannabis and marijuana market is experiencing explosive growth, with a nascent but expanding industry racing to catch up. Regulations, legality, and stigma are still making it difficult to market cannabis online, but there are proven ways it can be done. Here are methods we've used successfully to market cannabis-related products for our customers. The future is bright and now is the time marketers can shape the cannabis industry.
The market is booming.
In a recent article entitled The Marijuana Industry is Getting Supersized, Forbes reported that the cannabis industry had grown to $6.5 billion by 2016, with a projected future growth to $30 billion by 2021. Meanwhile, Bloomberg projects the industry will reach a total value of a whopping $50 billion by 2026.
Additionally, the market growth of cannabidiol, the main nonpsychoactive cannabinoid present in the cannabis plant (it is also known as CBD), is no less impressive. In fact, it may be the most promising sector of the entire cannabis economy. In another recent article, Forbes says CBD commanded a $170 million industry in 2016 and is projected to grow to a whopping $1 billion market capitalization by 2020, with a compound annual growth rate of 55%.
Here at Creative Propulsion Labs, we follow the cannabis market closely. The market can be challenging for anyone due to a patchwork of local and national regulations, a persistent stigma, and a banking infrastructure slow to adapt, but the potential is great and even now there are many things a marketing agency can do to grow its cannabis clientele within the space.
At first, the challenges appear daunting.
One of the biggest obstacles is the Food & Drug Administration. When promoting the sale or consumption of cannabis or marijuana products for health purposes, it is imperative to follow strict guidelines set forward by the FDA, and not to make direct health claims even in states where medical marijuana is legal.
Remember, cannabis has not been approved by the FDA as a medical product, although they have acknowledged that many people use it for very legitimate medical purposes. In the future, this may change, but for now, the current regulatory limbo is unavoidable. Industrial hemp, which is low in THC but high in CBD, can also be sold as a 'food' or a dietary supplement in all fifty states.
It is also acceptable to present the results of third-party scientific research and studies on the medicinal efficacy of cannabis in general or your product in particular, as long as you are clearly attributing the claims to that research. Always link to your sources to substantiate claims. Directly linking to the research is ideal.
So, now that you're not technically marketing cannabis as a medicine, where can you actually sell it? Well, that's a little complicated. Even though it's 'not' a medicine, it can be sold in many states where medical marijuana is legal with a doctor's prescription. Yes, it is ironic.
Usually, the process for a consumer to procure the prescription is a little different than with most medications though, requiring a visit to a doctor with specialized training and a trip to a marijuana dispensary rather than a traditional pharmacy. Moreover, those rules vary widely state-by-state and even municipality-by-municipality and it's your job to be aware of those rules in whichever geographical market your cannabis client is does business in.
Take the example of the marijuana startup that purchased an entire California town only to discover that although marijuana could be consumed on the property, only CBD could be sold there because it's in an unincorporated part of the county. Something like that could surprisingly easily happen to you.
It should also be mentioned that, out of confusion or ego, even perfectly legal CBD products are still sometimes raided from store shelves. Consider recent incidences in Indiana and Nebraska, where that legality was challenged. Although these situations can be annoying, they are usually temporary. Although news reports like this shouldn't discourage you, you should be aware of them, and be prepared.
Money, as in any industry or endeavor, is another crucial obstacle you have to consider. Although in the last few years, and even the last few decades, cannabis has come out from the shadows, many banks and creditors still don't accept 'those' clients. Of course, legality plays a major role in the acceptance of the cannabis market by the banking system, but the added risk from societal stigma is another obstacle for its acceptance by banks or other financial institutions.
Now, to the actual marketing. Despite the booming market, there are many marketing cannabis marketing issues in our digital world. For example, you can't buy ads on Facebook or Google, or most other ad networks, or even on ad retargeting platforms such as AdRoll. It's easy to get your Instagram page or other social media accounts blocked if you don't walk a fine line. And most retargeting ad platforms have yet to allow cannabis ads.
So, what can you do?
Social Media
When marketing cannabis, there are things you can do now. You can work with existing cannabis networks on social media, on platforms like Facebook, Instagram, YouTube, and SnapChat, which we find to be the four best. YouTube shows the highest conversion rates. Instagram is next, then Facebook. Both informational and entertaining content are good for either site, but remember to be aware of the platform your content is going out on. Make platform appropriate content. This is all crucial because, as you remember, you're not allowed to run ads on any of these networks.
We have found one way to successfully run ads on Facebook. Educational cannabis advertising, not actively promoting or linking to products, has worked. Another strategy you can use to is to build a one-page landing page where you're collecting an email and offering some type of free item of value like an educational pdf for example. Then, once you've got an email address you can then send them your email marketing campaigns.
Influencers
You can work with influencers on social media and other channels, including famous people that get their message across to a niche market. An increasing number of mainstream celebrities are also embracing the reality and potential of cannabis. By all means, you should reach out to them. But the best thing you can do is produce high quality, engaging content that spreads organically. Create funny videos or quick and easily shareable memes. Create thought-provoking writing. Create an engaging dialogue. Go viral.
Content Blogs
Make them crave what you do, and make them want you and your product, and you'll overcome many barriers. With high-quality content, create sites like CBD Journal and CBD Living, two valuable resources we've built from scratch for one of our clients. These are content blogs that help promote industry education and awareness and send traffic to revenue producing sites. They also help with building authority and influence for our client's brands.
Advertising
You can run advertising on networks that do allow it, such as Mantis Ad Network. Interestingly, Traffic Junky, an ad network that displays on most major adult sites, has just started accepting cannabis ads. More will eventually and inevitably follow. You can work with publications like Leafly and High TImes. You can purchase sponsored posts on other sites. As mentioned before, although Facebook does not allow advertising, if it's purely educational it may be ok.
Events/Industry Conferences
Finally, go even more old school, and attend industry events. Established forms of public relations and marketing such as these have survived the test of time because they work. So, set up a booth at a cannabis convention, or branch out and try a health food expo or maybe a gourmet food fair. How about a rock concert? Promoting your product face to face is the original form of marketing. It will always work.
Remember, the industry will mature. Much more support infrastructure, like banking, governmental regulations, and advertising channels, will come into place. Banks will begin to loan to cannabis industry players, and the legal obstacles will be substantially cleared up. Yes, if you wait, it will be easier, but if you enter the cannabis marketplace now you can affect the change that you want in this space. Creating that change is the one thing that will be more difficult to do later on.
Email Campaigns
For now, you will probably have to rely heavily on emails campaigns as you grow your customer base. Although one of the oldest forms of internet communication, luckily email campaign still have one of the highest ROIs. Even with the different options, we've laid out so far, due to the limitations of marketing online for cannabis your strongest channel will most likely be your direct email marketing campaigns by far. These can be a combination of automated flows and promotional campaigns.
Your options for marketing cannabis may be limited right now, but the future is bright. Now is the time to get in if you really want to capitalize on the long-term growth, and help shape the growth of the cannabis industry.
