The cannabis industry is one of the fastest-growing industries in the United States. The industry has grown beyond its humble roots, becoming a giant in the space. It includes a massive retail sector, multi-million dollar cultivation facilities, delivery services, media outlets, and software platforms. But even with the cannabis industry’s meteoric rise since recreational legalization in many states, there are still many obstacles surrounding the marketing of cannabis. Strict federal, state, and local regulations, a lingering social stigma, and heavy restrictions placed on advertising have created a challenging environment for marketing teams trying to connect with consumers in the cannabis market. There are also more cannabis marketing jobs on the rise to help businesses advertise effectively while adhering to regulations. In this guide, we will explore strategies to produce a creative and viable marketing strategy while remaining compliant with laws and regulations.
The Challenges of Cannabis Marketing
With annual legal recreational and medicinal cannabis sales growing at a staggering 21% and experts projecting the market to reach $43 billion by 2025, the cannabis industry is gaining new customers at an incredible rate. This increased mainstream popularity means plenty of opportunities for savvy marketing strategies to engage with new consumers in the cannabis market. However, despite cannabis-derived products such as CBD finding their way onto the shelves of retail box stores and recreational cannabis use slowly making its way from the counter culture to popular culture, cannabis is still illegal at a federal level, and there are strict regulations on how and where you can market cannabis products.
Cannabis is subject to many of the same marketing limitations as tobacco and alcohol. But governmental regulations are even tighter because it is still illegal at the federal level. In addition, many advertising platforms also have their own policies regarding cannabis marketing, further tightening restrictions. By law, cannabis ads must be specifically targeted to people over 21 years of age, cannot include any medical or health-related claims, and are highly limited in outdoor spaces, depending on the state. Before formulating a marketing strategy, research your area’s state and local laws. Also, become familiar with all applicable legal restrictions to avoid incurring hefty fines and penalties.
What Does a Successful Cannabis Marketing Strategy Look Like?
Creating a successful marketing campaign in the world of cannabis requires careful planning and strong knowledge of your audience. When creating ad content and promotional material, it is important to know to whom you are speaking. Studying and being aware of your target audience’s interests, demands, and aesthetics will help you tailor your message in a way that can achieve results.
It is also essential to know your platform. Some companies like Google, Facebook, and Instagram have additional restrictions regarding cannabis advertising and remove ads that violate their guidelines, so it is also vital to tailor your content to avoid being flagged and removed.
Goals and Metrics
Setting goals and tracking the progress of your marketing campaign is critical to measuring the success of your strategy. Formulate specific goals around what you want to accomplish and use reliable analytical tools to measure the results of your advertising efforts. This will allow you to see where your time and money are best spent and where you may need to adapt and adjust your strategy to maximize its effectiveness.
A Multi-Channel Approach
With the variety of channels and platforms available today, it is important that you do not put all of your marketing eggs in one basket, so to speak. Utilizing cross-channel promotional strategies will help you reach a more significant number of your audience faster and more efficiently. Research your customers, create profiles to flesh out your target audience, and formulate a media plan that devises how to reach as many people in that audience as you can for the lowest possible price. Solid research and adaptability will allow you to make contact with the highest number of customers across different channels and tailor your messaging most accurately to their needs.
Cannabis Advertising Trends 2023
Changing Consumer Base
As cannabis moves further into the mainstream, consumer demographics have moved with it. The typical “stoner” is no longer the standard profile of a cannabis consumer. The demographic of cannabis users has broadened significantly, and it is important to consider how customer profiles vary depending on region, product, and brand identity. To stay connected to customers, regularly conduct research on your target audience to track how it changes and evolves. You can also refer to our cannabis consumer trends blog, which is updated annually.
Focus on Education
New products/New Consumers
Cannabis products have evolved and diversified exponentially in the past few years. Ingesting cannabis by smoking a joint is now just one of the hundreds of options available on the market for consuming cannabis. Products like cannabis oil, cannabis beauty and skin products, CBD products, cannabis beverages, edibles, capsules, and even cannabis dog treats are readily available at your local dispensary. In order to position your business or brand as a trusted authority on all things cannabis, it is imperative to keep up with new products being released into the market and craft marketing that educates consumers. Presenting educational content creates trust and brand recognition with your consumer base, particularly those that are new to cannabis products.
Industry News and Thought Leadership
Another way to merge education and advertising is through industry news and thought leadership. Rather than explicitly promoting your brand for direct conversions, tailor some of your marketing content toward educational content and industry news. Producing relevant content on emerging issues, trends, and products can position your brand as a trusted resource amongst consumers that will keep them coming back for more.
Cannabis Marketing Channels
Some marketing channels have strict limits on cannabis content, so selecting which channels to market through for your cannabis business takes a combination of strategy and caution.
How to Market Cannabis on Social Media
Social media has become a powerful force in marketing. Over 70% of Americans have some form of social media account, and the majority of them use it to follow brands as well as friends. And while social media has a history of banning cannabis content and cannabis-related accounts, times are changing. Having direct access to cannabis consumers on social platforms is too effective to ignore.
Paid vs. Organic
There are two different ways to advertise on social media, paid ads and organic ads. Paid ads refer to specific ad campaigns a brand pays to put onto a social media platform. They can be in the form of text, a static image, a series of images, or a video. Depending on the platform, these ads will appear next to, between, or before standard content. Often these ads have features like lead generation or form-fill capabilities, and they cease when the paid ad campaign is over. When it comes to cannabis, it gets tricky, as Facebook, Instagram, and YouTube prohibit any advertisement that promotes the sale of illegal, prescription, or recreational drugs, including medicinal and recreational cannabis. Currently, the closest you can get to permissible paid advertising on most social media platforms are “lifestyle” images and videos that do not expressly mention specific products or words directly associated with cannabis.
Organic content is free to post on social media platforms and pops up in people’s regular feeds. There is no limit to organic content, and it will not disappear until you choose to delete it. Often, this content is aimed to promote organic engagement with consumers through the platform, fostering relationships and ingratiating the brand into the community of users. While still subject to the platform’s terms of service, organic content has a lot more leeway when it comes to posting content that mentions cannabis explicitly. When approaching organic content, it is vital to consider your audience, your brand identity, and the structure of the platform itself in order to maximize the effectiveness of your marketing efforts. Product spotlights, dispensary information, lifestyle content, and educational materials are effective ways to push your brand and connect with your target audience.
Email marketing is an effective way to build a marketing campaign that reaches customers directly. Start by selecting an email service provider that allows cannabis marketing (some providers allow it, others may deactivate your account). Once you have chosen a cannabis-friendly email service and built a subscriber list, you can begin using email marketing as a cost-effective way to build brand awareness and nurture customer loyalty. Email marketing can include personalized welcome emails for new customers, cannabis replenishment notices, newsletters, surveys and reviews, and loyalty and referral programs. Contracting companies like Cannabiz Media to build a solid email marketing channel for your business is a great way to engage with new customers and cultivate awareness and loyalty with repeat customers.
Video content on platforms like YouTube is a great way to educate consumers about cannabis products and provide unique, valuable information to your target audience. It can also be effective across channels, as links to YouTube videos can be posted to organic accounts on Facebook, Instagram, and Twitter to drive traffic.
Digital audio advertising through podcasts is another highly effective tool for marketing in the cannabis industry. There are countless podcasts available that cover every topic you can think of, which provides a variety of platforms that can reach all corners of your customer demographic. There are also two different ad formats from which to choose, host-read ads and pre-recorded ads, which give you the option of utilizing the trusted voice of the host to your advantage or introducing your own unique audio content to be played during the podcast. Sponsoring a podcast is a great way to achieve seamless advertising, brand awareness, and customer engagement.
Another way to take advantage of the digital audio format is to start your own podcast. As of 2021, there are over two million podcasts, nearly fifty million podcast episodes available (Podcast Insights, 2021), and over two thousand cannabis-related podcasts on Spotify alone. Cannabis podcasts can offer knowledge, opinions, and inspiration on a wide range of topics affecting the cannabis industry. This includes cultivation, sales, scaling, entrepreneurship, and marketing. Many cannabis brands have opted to start their own brand-centric podcasts, providing relevant content surrounding industry news and guiding thought leadership that engages with consumers directly and builds brand loyalty.
For any cannabis business, visibility and brand awareness are key aspects of building a successful enterprise. Researching your customer demographics and establishing your target audience will allow you to strategize on the best way to reach them. Once you have determined the most effective avenues to engage, set measurable goals for your marketing team and start producing compelling content that will increase brand awareness, grow your customer base, and convert more sales.
Partnering with Influencers
You can help your dispensary or cannabis business reach a wider audience by partnering with an influencer. Also, the partnership will help to build trust with your target audience and current customers. 50% of Millennials trust product recommendations from influencers. In comparison, that number drops to 38% with celebrities. Therefore, partnering with the right influencers would be a great addition to your cannabis marketing strategy.
Find influencers with values that are similar to your brand. You also want to try and find an influencer with a target audience that fits with yours. It doesn’t have to be a perfect match, but at least a few qualities should align. When you email an influencer for a potential partnership, include the following:
- Your brand name and position at the company
- Products and/or services you sell/provide
- Type of partnership you’re offering (e.g. sponsored campaign/post, affiliate code for their audience, etc.)
- Compensation options
Remember to be specific and brief. Influencers may get plenty of requests.
Conduct Customer Surveys
A customer survey can improve your cannabis marketing strategy, as you’re going straight to the source for feedback. You can determine customer satisfaction with a simple survey after they’ve made a purchase. And you can see if they were happy with the product and if they have any specific feedback for your service. You can also ask if they would go back to your dispensary or do business with you again. Make the customer survey specific to what you want to know. And make it brief.
Look for patterns in the feedback you get. This goes for both positive and negative feedback. It will allow you to make the necessary changes to increase your likelihood of getting repeat customers. A customer survey is pivotal to creating a successful marketing strategy. Data can only tell you so much. It gives you insight into purchasing paths, cannabis consumption preferences, and allows you to understand your target audience better.