Yes, You Can Advertise Cannabis

Know the options, research your ideal customers, and devise a unique message that rises above the noise.

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Cannabis is moving forward. Despite how exciting it’s been to operate in an emerging industry, each passing day brings greater clarity about regulations and less confusion about what we can and cannot do.

As we move toward federal legalization and the true end of prohibition, the market will become saturated with licensed operators, and brands with the largest audiences will survive. There will always be a space for craft but, even there, operators will fight for regional dominance.

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Market maturity breeds greater competition and increases the importance of building a strong, recognizable brand.

With increased competition, marketing becomes ever more necessary. The growing need for brand recognition means marketing budgets are expanding. New technology will help level the playing field between small and large companies and shrink the education gap with a massive number of consumers. Additionally, as businesses evolve and consumer education begins to catch up, advertisers need to be more resourceful, targeting their spends to support both brand awareness and customer acquisition strategies.

Here to stay

Like it or not, big businesses are coming in with large advertising and marketing budgets, and they’re going to bring brand awareness to every consumer in the country whether or not they’re currently a cannabis user. Through mass media campaigns, they’ll educate and inform, create an aura of comfortability with 240 million potential customers, and slowly drown out other companies’ voices by restricting their access to new markets and reducing competition in the long run.

Whereas in the past small- to medium-sized entities and mom-and-pop operations could survive on their small but loyal customer base by establishing quality products and services, advertising has become crucial to retaining and growing a consumer base. No matter a company’s size, advertising to users across all avenues ensures the business will remain competitive as it secures space in the minds of current and future users. Brands thrive by convincing consumers the brand can be trusted in a product category that is new for many people.

Leveling the playing field

While it’s true this industry is limited or banned from advertising on platforms like Facebook and Google, it’s important to realize those properties block cannabis advertising as company policy, not because weed is illegal at the federal level. However, this does not mean your ability to reach new consumers—whether your brand is business-to-business or business-to-consumer—is thwarted. The ability to advertise at scale exists, and there are many ways to do it.

Although large portions of the population do spend time on social media platforms, there are millions of other sites that don’t restrict cannabis advertising and where plenty of people spend their time. Every one of us has countless other apps or visits other digital properties daily where advertising exists and cannabis brands are allowed: news sites, sites for sports scores, weather and gaming apps, text messaging or social apps…these are all on people’s phones.

With new-age advertising tech, aggregating these other small and large media properties provides advertisers the same, if not more, scale and targeting capabilities than a Facebook or Google property. With access to these pools of inventory, you can reach consumers according to their location, purchase preferences, demographics, and many more attributes that ensure you are targeting the right people rather than just the right sites or apps.

Tactics for securing audience loyalty

A number of different tactics can help businesses identify and reach consumers, but a few form the foundation of most campaigns. The most basic is website retargeting. Once someone opts in to a mailing list, you can send messages encouraging them to make a purchase, visit a retail environment or, if they’ve already made a purchase, offer a special deal to earn their loyalty. One caveat, and it’s a big one: In order to comply with federal law, make sure people who sign up on your website give permission for you to contact them with advertising messages, and make sure every message you send includes a link at which they can unsubscribe.

“Lookalike” audiences are another way to target consumers. By profiling the foot traffic at your store and visitors to your digital assets, then combining that information with information gleaned from your customer-relationship-management database and purchase data, you can begin to understand which demographic groups are interacting with your business. What age groups and income levels are represented? What conditions do they seek to alleviate? What lifestyle choices do they want to enhance? How do those factors correlate with specific products? Examining demographics and behavioral patterns is a powerful targeting mechanism that will enable you to pinpoint potential new audiences that mirror your existing customers, providing your brand with a more cost-efficient approach to reach converts and potential loyalists.

In addition to demographics and behavior, location can be a great way to understand potential. For example, if location data places a consumer in a dispensary multiple times over a month, that’s a shopper dispensaries want to keep and brands should court. Do those people share any characteristics that could help you identify an untapped market?

Mixing and matching all the different targeting techniques can be a daunting task, but data that helps inform your decisions about audience and location can make media campaigns and revenue generation more successful.

Media purchasing

With the absence of Facebook, many companies are buying out-of-home placements (billboards, for example), print ads, and/or media space on specific websites. In cannabis, we tend to see a lot of digital media network buys: space on a group of sites, usually all with similar content or audience profiles. Network advertising allows businesses to spread their message across a broad audience or micro-targeted audiences. The tactic may not result in immediate sales, but the goal is brand recognition, not sales.

Ad networks have enormous value in reaching people who are enthusiastic about whatever the collection of sites presents: hobbies, cooking, lifestyles, sports, travel… The list is endless, and it includes cannabis. When placing ads directly on high-value sites or a network that has control of on-site placement, the big advantage is being able to create memorable experiences that are not available when buying via programmatic systems like Google Ads and Facebook’s advertising engine. Networks and independent sites often offer custom placements like website skins, takeovers, skylines, intercepts, and billboards, any of which can help your brand rise above the noise. Cannabis advertisers are concentrated on cannabis sites and ad networks, making unique messaging important to ensure your business isn’t drowned by others offering similar wares.

Don’t forget to balance exposure against reach. Reach is the total number of people who engage with a given site; exposure is the number of people who will see your ad. Direct buys generally offer more customization but less reach. Most cannabis-specific sites and networks engage only a small fraction of the 21-and-older consumer market. They also usually lack some of the segmentation and targeting capabilities, because they normally allow only run-of-site (ROS) or run-of-network (RON) buys. ROS and RON arrangements mean your message can appear anywhere on any site at any time, and the audience will be any visitor instead of the specific subset of visitors you seek. Lack of reach and limited scale are common across all media outlets because inventory owners, media providers, and laws prohibit cannabis advertising. Given the restrictions, it becomes even more important to invest in technologies that allow you to reach the masses accurately and at scale.

While it’s true new technology like programmatic ad buying can reach 99 percent of known and potential consumers on their digital devices, an omnichannel media presence is the optimal path to developing a strong brand. Exposure across different screens and forms of media (omnichannel) drives a significant increase in brand recognition through multiple exposures and forms of ingestion. Expanding your message beyond current consumers and reaching people before they enter the market is essential to the continual growth of your business. Simply retaining customers is not enough as more and more well-funded competition enters the arena with a plan to swallow market share.

Takeaways

There’s no right or wrong way to expand your market. The important thing is to find what works for you. Rather than making assumptions about where to deliver your message and who to target, use data to make informed decisions. Customer data will help you figure out where to start; then, utilize that education to expand your reach across multiple properties and mediums.

Rather than competing with the noise, build unique experiences tailored to your ideal customers so you present nuanced, personalized messages that drive results. For any business to do this successfully, measurement is key. Measure not only clicks and views, but also foot traffic and sales that result from all the different touchpoints you have with customers. Advertising strategy should be founded on making informed decisions that are backed by data. As you continue to move forward, you must remain agile while also finding a way to continue measuring everything.

If you engage out-of-home advertising, make sure you’re reaching the correct audience, buying the right locations, and measuring results. If you execute print or digital ads, make sure you understand the likelihood a campaign will send a high-value consumer back to your doorstep. Go omnichannel, be agile and aggressive and innovative, and explore every option you have—but constantly test, measure, and optimize toward the platforms and partners that are driving real results. 


Travis-Scadron-Surfside-Headshot-mg-magazine-cannabis-news

Travis Scadron is director of business development at Surfside. The company empowers clients to find and attract qualified cannabis consumers through activation of digital and offline audiences via marketing, insights, and measurement. Surfside helps clients identify and understand customers based on billions of real-world signals for retention and acquisition.

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