Opinions about the challenge of cannabis marketing range from, “it’s just another CPG brand” to “we can’t say anything without losing our license”. Regulations around cannabis marketing dictate how brands can share their messages with consumers. These regulations
Marketing Cannabis in the United States
The United States is home to many well-known cannabis brands, but different regulations between states make it difficult to build broad awareness. In some places, cannabis marketing is treated very much like alcohol, and in others it is completely locked down.
Here’s some reasons why it’s great to be a cannabis brand in the US:
- Some states’ regulations are quite liberal, allowing cannabis to be advertised in very similar ways to alcohol. California is a clear example. It has led to many polished and lifestyle-oriented brands coming out of California, as well as celebrity brands like Leafs by Snoop and Khalifa Kush.
- Because cannabis brands are state-locked for the most part, cannabis brands are able to act a bit like craft beer. Local, quality, and artisanal messages are often front and centre. In craft beer, this was a response to faceless mass brands, but in cannabis this is how it has always been.
- The US has a large population, so it is still possible to achieve some scale even when limiting marketing to one state. California and Michigan are both legal recreational states and are among the top 10 most populous states.
These are some ways it might be difficult:
- For most recreational cannabis brands, it is difficult to operate in more than one state. This leaves most brands confined to their home state, making it challenging to grow as much as shareholders might want.
- Even multi-state operators have to respect the advertising regulations of each state. This could mean anything from tweaks to an existing campaign to an entirely new campaign for each state.
- Achieving scale can be very difficult if you are working in a small state. Unfortunately, four of the legal recreational states are in the top ten least populous states. Marketing a brand in Vermont is a different challenge than in California.
Cannabis Marketing in Canada
Depending on your perspective, marketing cannabis in Canada is a bit easier than in the US. The rules are more restrictive than alcohol, but less restrictive than cigarettes.
Here are some great things about marketing cannabis in Canada:
- Cannabis is federally legal in Canada. This means that all provinces are working from the same base set of rules (Bill C-45). Provinces can choose to make their laws stricter than the federal rules, but so far there have not been huge changes from Bill C-45.
- Brands are free to be sold in whichever jurisdictions they can get listed, which means inter-provincial and national campaigns are possible. This makes it easier to buy at scale in a relatively small (population-wise) country.
- Advertising outside of strictly age gated environments is possible with the proper precautions to ensure that everyone who sees your ads is over the legal purchase age. Because of the wording of the bill, interpretations of the required measures vary greatly between legal departments.
Like in the US, there are also some challenges:
- Bill C-45 strictly bans endorsements, depictions of people, and depicting a way of life such as one that includes glamour, recreation, excitement, vitality, risk or daring. This means that brands associated with celebrities can’t communicate that in an overt way.
- The hurdle for ensuring that an audience is above legal purchase age is a lot higher than it is for alcohol. This eliminates most traditional media (tv, radio, billboards, etc.) from consideration.
- Canada fundamentally doesn’t have a large population. As well, only about 33% of Canadians have ever consumed cannabis. This puts a ceiling on the growth a brand can achieve in the country.
Marketing Cross-Country or Globally
Because of the limited recreationally-legal countries in the world, cannabis marketing hasn’t really taken off at scale. The licensing requirements of medical cannabis also don’t lend themselves to global brands like we see in over-the-counter drugs. The CBD/wellness space may be where we see a global brand begin to emerge.
Cannabis advertising also has some challenges on the supply side all over the world. Google takes a hard line on cannabis advertisements including CBD in every country, even where cannabis is recreationally legal. This eliminates a large portion of digital inventory across the web. Facebook is similarly bans recreational cannabis advertising, but is open to ads for CBD. Getting a message out without these advertising giants requires more creativity than the average CPG brand.
How Cannatrack Can Help
Cannatrack operates in all recreationally legal markets as well as medically legal/recreationally decriminalized markets. We use the same core questionnaire across all markets, which makes it extremely easy to compare consumer behavior in different areas. Each market presents its own challenges, but Cannatrack is able to help all over the world.
You can also sign up for the Cannatrack newsletter to receive monthly emails with cannabis industry insights and analysis.