As the CMO of one of the largest public companies in the fastest-growing industry in the country, I’ll forgive those of you who haven’t heard of us (yet). That awareness is largely due to the federal illegality of cannabis combined with a series of marketing restrictions and challenges that exist uniquely in the cannabis space. I joined Harvest Health & Recreation Inc. after more than 20 years in sales and marketing with CPG giants like Unilever and spirits experience as the CMO at Beam Suntory. I had no prior experience in cannabis, but soon found several hurdles that have forced us to be creative in order to reach patients and consumers.
Choose Your Own Adventure
Marketing has always appealed to me because our efforts create demand and the creativity involved builds value and puts a soul in companies. That has never rung truer than in the cannabis space today. Thirty-three states, the District of Columbia and Puerto Rico have a patchwork of state-specific cannabis laws and regulations to follow—most similar—but several are vastly different. Which means you need at least 35 different marketing plans and strategies just to stay compliant (note: In our industry, smart companies have lawyers woven into every level).
While the beverage alcohol business was similarly state-specific, there have now been nearly 100 years since the end of Prohibition for the alcohol industry to find common ground and similar regulatory frameworks. We are virtually at “the day after Prohibition” in the cannabis industry…possibly even slightly before it.
Once you’ve designed a compliant campaign, however, your options are further limited on where you can actually display your final product. Social media—long the anchor of effective direct-to-consumer marketing—is almost entirely off-limits. The major platforms, Instagram, Facebook, Google, Snapchat, all have self-imposed company policies that prohibit or severely restrict any type of cannabis-related advertising. Broadcasters also get to decide whether they’ll run ads, but for the most part, have declined to do so. As a result, we’ve chosen to invest significantly, and innovate around, some of the more traditional channels to reach patients and consumers.
By focusing on patient programs, customer loyalty, physician outreach, email marketing, budtender education, CRM campaigns, geofencing and age-gated mobile targeting, we are developing a clear picture of who our customers are and the best ways to interact with them. That picture is equally female and includes many older demographics and more sophisticated consumers.
David Vs. Goliath
You won’t find cannabis clients on the rosters of Madison Avenue’s most prominent names. Most, if not all, belong to holding companies who have yet to venture into the exciting world of cannabis. Instead, a creative network of forward-thinking small and medium agencies have taken advantage of the level playing field with some of the biggest names and companies inthe cannabis space.
Earned & Owned For The Win
Earned media has always been an incredibly compelling form of connecting with audiences, and in cannabis, it is worth its weight in gold.
There are so many facets of (and stories within) our company that are of interest to a wide range of audiences. We spend considerable time to share them with both the media and the public through our channels. In a limited paid media environment, using our channels or the channels of others (influencers, tastemakers) to spread the word is critical. Ecommerce poses its challenges, even in the non-THC (psychoactive) aspect of the cannabis trade. Many believe the passage of the Farm Bill last December legalized hemp or CBD.
“Earned media has always been an incredibly compelling form of connecting with audiences, and in cannabis, it is worth its weight in gold”
In actuality, the new bill’s passage simply swapped regulation of the hemp plant from the Justice Department to the Food & Drug Administration. That means there remains a significant gray area around the legality of CBD and hemp products and has resulted in a limited number of banking, processing and back-end service providers.
Most importantly, while there are thousands of hemp-based CBD products on the market, the FDA has yet to approve it for use in food, beverages or cosmetic products.
Patient data is of considerable importance and subject to stringent oversight; it must be treated just like any other sensitive medical information. Although we have personal information on our patients, we work closely to make sure they have opted in to any communication we may send their way, and their information is treated with the utmost privacy.
The Coca-Cola Of Cannabis
Where there are challenges, there are unique opportunities. We aim to build some of the first truly national brands in the category and establish a suite of household names in cannabis.
Due to our vertical-integration (operating throughout the seed-to-sale process, including cultivation, manufacturing, distribution, product and retail) we have an opportunity to move our brands throughout our industry-leading footprint of retail facilities in the U.S. We recently took Colors—one of our best-selling vape pens from Colorado where it’s well-known and beloved—to stores in Arizona and Florida. Soon, we will also be distributing in California.
“Where there are challenges, there are unique opportunities”
Where in the past a cannabis brand lived locally and only in the state it was grown and manufactured, our model allows us to use our scale of cultivation, processing and retail in each state to expand the reach of brands to other markets. However, the logistics for rolling a product out require more investment, coordination and customization than any other industry. Companies are prevented from moving products across state lines and must instead produce and finalize SKU’s separately in each state in which they operate.
There has never been a time like this in our history—where the largest players are barred from entry, federal and state laws and policies often contradict one another (or at the least pose serious confusion), channels to reach customers are severely restricted and basic services like banking and ecommerce are near-impossible to come by.
However, there have never been so many Americans who support cannabis legalization no matter their politics or age. Fortunately for me, Harvest will be there to capitalize on this historic opportunity, and I will continue to have one of the best jobs in marketing, making history every day.
“There has never been a time like this in our history—where the largest players are barred from entry, federal and state laws and policies often contradict one another…”