In my professional career, I’ve attended conferences and trade shows across all sorts of brand categories: fitness & health/nutrition, tech, outdoor recreation, consumer food & beverage - you name it, I’ve probably been there! This past week I attended Weed Week PDX 2016, which is a cannabis industry event where professionals specializing in each aspect of the business get together to share best practices & innovations, industry trends, and network. While in many ways, the programming was very much like your traditional industry conference, the discussions I participated in allowed me to take a step back to more fully understand how the industry currently functions and see where the industry is headed.
The cannabis industry is in a state of transition and innovation, and on the verge of a big boom with recreational marijuana being legalized in a number of big markets this past election. In sessions, I spent most of the time listening – listening to the questions of consumer brands, growers, retail owners/operators, etc. I glanced at the notes of those sitting around me to see what their big takeaways were. From very green to branding experts, it was clear that with the cannabis industry is still finding its legs to some degree. Trial and error will be the game for a bit, but the good news is that at this stage there is room for experimentation.
Here are the top 8 topics of discussion that were of most interest to the contacts I met at Weed Week PDX 2016: (Please note: Budgets outlined are not quoted by STILETTO, but by other cannabis industry leaders)
· 80:20 Rule (Sales): Highly saturated market with more and more products entering the market, while 80% of the sales are from 20% of the available product.
· Relationship-Oriented Business: Sales are heavily reliant on the relationships with Budtenders, and the Budtenders’ recommendations to consumers. Will this shift as the industry grows and brands begin marketing directly to the consumer and if so, how do brand effectively market? Answer - Yes, but the importance of Budtenders will still be a top priority. Social Media and PR will play a large role in reaching existing and new consumers.
· Social Media: Social media is a huge opportunity as it is less regulated and accessible to everyone, but has also created some hurdles since cannabis has been a controversial product in the past (and sometimes, still is).
o Brands also have difficulty allocating time to a process that doesn’t have a “proven” ROI in terms of sales or driving foot traffic.
· Influencers (Digital, Social Media, & Celebrity): Playing a larger part in marketing cannabis than ever, and expected to increase along with the expansion of the industry
· Consumer & Industry Data: There are services that can provide real-time analytics, such as Headset, there is very little consumer data available since transactions are conducted in cash and few consumers sign up for a “subscription” or “frequent shopper” program.
o Current Stats Include*:
- Average $ per Transaction: $33
- Male/Female Purchaser – 2:1 Ratio
- Average Consumer Spend per Year: $1k - $2.5k
- Average Age of Consumer: 37
*Data provided by Headset
· Cannabis Media/News Outlets & PR: Top Content that is Featured
o Promoting an industry event
o Content Marketing - Focus on educating the reader versus selling the product – If the product is innovative, especially in the medical arena or reaching a new demographic, focus on that aspect. If it feels like an ad, it won’t be included in their content
o LOVE research/data-driven content – There is a lack of data in the industry, so independent studies that carry weight are likely to be shared.
· Branding: How important is branding? Answer: VERY.
o Investing early in branding materials that align with your brand and price point will help your products stand out in a saturated market, increase Budtender recommendation, and save you from a re-brand after your product is already established and recognized by your consumer.
o Branding Budget: OMD Agency recommended a minimum budget of $25k for comprehensive branding.
· Marketing Budget: Recommended Marketing Budget - $3k/mo Minimum*
*May vary by product category and medium/platform. Also, dependent on tactics utilized (influencers, etc.).
In addition to the above information, in the Day 1 recap, we touched on many marketing tactics that will be leveraged as brands further develop their marketing campaigns and expand their consumer base.
STILETTO will develop and execute marketing strategies that maximize the impact of your budget, as well as secure strategic brand partnerships and PR.
Please contact STILETTO directly for a free consultation to discuss marketing strategies to differentiate your brand.