Marketing Brew: In the weeds: How cannabis businesses get around a web of online advertising barriers
Marketing Brew – September 2, 2021
Written by Zaid Shoorbajee
In the US, cannabis is a $17.5 billion industry. That’s despite its legality varying from state to state. Oh, and the fact that it’s still federally illegal.
Those contradictions create inevitable challenges for anyone running a cannabis business, especially when it comes to marketing.
Because of the legal variances and stigma around pot, agencies aren’t always willing to work with cannabis brands. Ditto for publishers willing to host cannabis-related ads. On top of that, Google and Facebook—staples for small businesses with modest marketing budgets—are largely inaccessible to cannabis advertisers.
Although cannabis businesses face a tangled web of restrictions on several fronts, they’ve carved out ways to promote their products online. Often, that means relying on organic content and SEO. Niche programmatic ad solutions are also emerging.
Post if you dare
If you’re a small business, arguably the most accessible and affordable tools to advertise your products are: a) the largest search engine and b) the largest social media network. Together, they happen to make up more than half of the digital ad market. Unfortunately for cannabis businesses, Google and Facebook’s ad platforms are off the table.
Google prohibits the advertising of “marijuana” as well as “pipes, bongs, cannabis coffee shops.” And Facebook says ads can’t “promote the sale or use of illicit or recreational drugs, or other unsafe substances, products or supplements.”
These policies make things difficult for smaller, sometimes family-run cannabis businesses. If they were selling almost anything else, Google and Facebook would be their go-to marketing tools.
“Anyone can go into Google or Facebook and run $500 a month worth of marketing and advertising. But when it comes to cannabis and CBD, we have less self-service options available,” Chris Shreeve, who heads the cannabis and CBD division at programmatic ad agency PrograMetrix, told Marketing Brew.
While paid ads typically won’t fly, that doesn’t mean brands have to stay off those platforms completely. Organic social media posts are a common way for cannabis businesses to get the word out, but they have to tread a fine line in terms of language and visuals.
“On social media, organic content posted by brands can get flagged if it’s using certain hashtags or is too explicitly promoting cannabis. There’s a lot of gray area, so brands have to navigate a difficult space when promoting their products,” Lisa Buffo, CEO and founder of the Cannabis Marketing Association, told us.
Because organic content can’t be programmed to only show up in states where cannabis is legal, posts have to be rather vague about what they’re promoting, Devon Herrington, head of marketing at dutchie, a cannabis e-commerce platform, explained.
“Instagram is notorious among cannabis marketers for being difficult to navigate because you can’t necessarily geogate a post that you put out there. So you need to put out messaging and content that works at the national level,” Herrington said, meaning posts that abide by the platform’s ban on marijuana advertising and sales. But marketers are often still left guessing, she said.
“For example, educational content related to cannabis is technically allowed, but some cannabis marketers believe even using terms like ‘cannabis’ or other similar phrases in post captions or tags will get your account flagged and potentially deactivated,” Herrington said.
When it comes to Google, although cannabis brands can’t run paid advertisements, they can still use SEO tactics to elevate their profile within the search engine.
“SEO is huge in cannabis,” Herrington noted, noting that businesses can create content like blogs and white papers that not only “add value” for their target audiences, but also optimize their websites and increase their search rankings.
Getting the normies onboard
OK, but there’s no way a multi-billion dollar industry’s online marketing tactics simply involve SEO wizardry and vague social media posts. Agencies and publishers do play a role, but cannabis brands have historically struggled to find ones willing to work with them.
Shreeve said this mainly stems from the stigma around the product. An agency might worry that bringing in cannabis clients will deter other brands from working with them. Beyond that, many agencies just lack the knowhow to deal with cannabis’s regulatory minefield.
“A team that doesn’t really truly understand the space, understand the plan, understand the consumer—they find it too difficult to manage those customers and clients because it’s just outside their wheelhouse. The amount of R&D and pivoting that needs to be done to service these clients can be a little too much for many agencies,” Shreeve explained.
There are roadblocks on the publisher’s side, too, but things are opening up. Herrington believes the tides are turning as more states decriminalize and legalize, and as the stigma around weed withers from public perception. Within a few years, “any major digital media player that is not accepting cannabis brands will look like a dinosaur,” she said.
Along with legitimization of cannabis comes an increased market potential. The continued growth of the cannabis market will further encourage publishers to accept cannabis ads, according to Herrington.
“What used to be a strong ‘No’ has now morphed into a ‘Yes, but only here,’ or a ‘Maybe in the future,’” Juanjo Feijoo, CMO at Weedmaps, another cannabis e-commerce platform, told us.
Ad tech, but for weed
There’s an increasing number of digital solutions available to cannabis brands: With programmatic advertising, they can automate ad buying and limit the scope to publishers that accept cannabis-related ads. They can also geofence their campaigns to states where cannabis is legal, and target only users who are known to be at least 21 years old.
“The days of calling an individual publisher and saying, ‘Do you take cannabis brand advertising?’ or, ‘Do you take CBD advertising?’ have really gone away. Now these programmatic ad networks are allowing brands to market and advertise on their wide array of inventory,” Shreeve said.
That inventory can take the form of display ads, mobile apps, and audio and video streaming platforms. Even connected TV (CTV) apps are on the table. Streaming devices such as Rokus and Samsung TVs have thousands of apps downloadable from their app stores, and Shreeve said that the long tail of inventory can be targeted if the user has shown interest in cannabis products online.
“Think games. Think more secondary or tertiary news apps,” Shreeve said.
If you can navigate all the caveats and exceptions, programmatic advertising for cannabis can largely work the same way it does for any industry. Shreeve, who also co-owns dispensary business The Bakeréé in Seattle, described a campaign he ran to inform potential customers about online ordering during the pandemic.
He was able to run 30-second ads across “thousands” of websites and apps, as well as “cannabis-compliant CTV inventory across major mainstream platforms like Pluto, Roku, Sling, and Samsung TV.” That campaign used location data to target people who visited competing stores and retargeted people who visited The Bakeréé’s website. A PrograMetrix case study on the campaign said it resulted in “record” year over year sales of $153,000 when it ran during the second quarter of last year.
While recreational cannabis use has been legalized in 18 states and Washington, D.C., it’s still not clear if federal legalization is on the horizon. If that were to happen, the extra complexities marketers in the industry have to work around would also change. For now, cannabis brands have to navigate a tangled web of state regulations, platform restrictions, and stigmas.
“You have to be excited by the ability to be creative and to innovate because it’s a lot of parameters,” Herrington emphasized. “The people that are going to thrive in this industry as marketers are the ones that really relish being on the cutting edge and can find ways to do more interesting work despite those restrictions.”