Cannabis companies in Canada have their work cut out for them when it comes to navigating restrictive regulations on marijuana marketing, but they also stand to rake in a shit load of cash.
The Ontario Cannabis Store accepted 100,000 orders in the first 24 hours after legalization, causing many customers to have to deal with late deliveries and shipping errors, which shows that even the province underestimated the demand for legal cannabis.
And according to a report from Deloitte, the total cannabis market in Canada (including legal and illegal sales) is projected to generate more than $7 billion in 2019.
Clearly there’s a lot of money to be made in this industry, but the regulations on cannabis marketing are wreaking havoc on pot producers’ ability to promote their products.
The rules in the Cannabis Act that relate to pot promotion are similar to those that apply to tobacco products, banning mass advertising and making it illegal to do things like market to young people, promote products through testimonials or endorsements, or present products in a way that associates them with a way of life “that includes glamour, recreation, excitement, vitality, risk or daring.”
Let me get this straight. Recreational cannabis is legal in Canada but advertising your pot products as something to be used recreationally is prohibited?
Needless to say, you won’t be seeing ads like the one below.
It’s examples like this that show how complex these regulations are, and really illustrate the dilemma that Canadian cannabis companies are facing.
But before I do any more ranting, let’s explore some of the cannabis marketing challenges faced by Canadian companies.
4 Marijuana Marketing Challenges for Canadian Cannabis Companies
In addition to all the restrictions imposed by the government, cannabis companies trying to market their products have to contend with a century of prohibition propaganda that has shaped Canadians’ perceptions of the plant.
If you look at surveys asking Canadians how they feel about legalization, the results seem to be all over the map.
As always, some of the more obvious opinions are being expressed, such as younger people being more in favour and older people being more opposed.
And even though it seems that support for cannabis is growing, clearly the stigma surrounding the substance is still very much alive.
A survey from Health Canada asked Canadians how they view cannabis, and only 45 per cent of respondents said it’s socially acceptable to smoke cannabis for non-medicinal reasons.
The survey, which concluded in July 2018, also found that only 31 per cent of respondents would be more willing to disclose their cannabis use after legalization.
2. Fearful Marketing Firms
The reluctance of many marketing agencies to get involved with cannabis companies is yet another reminder of how deep the stigma goes.
While only sections 16 to 24 of the Cannabis Act deal with the promotion of pot products (the act contains more than 225 sections), the range of promotional prohibitions found in those sections and the prospect of having to interpret the legal language is enough to make many marketers hesitant, despite the amount of money to be made in this industry.
A survey from Emerging Insider asked 600 marketers if they were willing to take on clients in the cannabis industry.
Only 43 per cent of respondents said they’d be willing to take on cannabis industry clients, with 32 per cent saying they don’t want to take on cannabis clientele and the rest of the respondents saying they’d need to consult with company executives.
Of those who said they’re not willing to work with cannabis clients, 38 per cent said working with the cannabis industry would create a “negative perception” of their company, and 26 per cent said they don’t have the expertise to get involved.
Tired of all this doom and gloom? Click here to check out our marketing tips for cannabis companies in Canada.
3. Facebook Isn’t Friendly
For cannabis companies, building a social media presence can be like trying to explain your love for bong hits to your grandmother.
The rules for advertising and posting about cannabis on social media platforms are limiting, to say the least, and although there are millions of Canadians on social media, what we’re allowed to do on these platforms is governed by the laws south of the border.
In the United States Controlled Substances Act, marijuana is in the same category as heroin, LSD and MDMA, so federally, it’s still highly illegal.
And even though the use of recreational cannabis is legal in Canada, as well as 10 U.S. states, advertising giants like Facebook, Google and Instagram aren’t taking any chances.
They all have strict rules about how pot can be portrayed on their platforms, and their policies often don’t align with their actions, making it extremely difficult for advertisers to know where to draw the line.
Showing people engaged in illegal activities is discouraged, and you can’t show smoking accessories, images of cannabis, or images which imply the use of recreational drugs.
Cannabis companies are basically banned from showing their products, and many are struggling to figure out how to effectively advertise while staying within the prescribed guidelines.
4. Legal Lingo
If you thought understanding the rules for advertising cannabis on social media was tough, try figuring out how to promote pot products in Canada.
The list of things you can’t do when advertising cannabis in Canada is so wide-ranging that I don’t even want to get into it.
But just to detail a few of the more bizarre limitations, you’re barred from talking about the price or distribution of your products, depicting people, characters or animals (whether they’re real or fictional), and there are strict limitations on packaging, right down to the size of your logo and the colours you use.
And in typical legislative fashion, the rules are absurdly extensive, they leave you with more questions than answers, and they’re practically unintelligible to anyone who isn’t a lawyer.
But what’s even more aggravating is the complete lack of clarity provided to cannabis companies looking to advertise.
On the government’s “Fact sheet” regarding prohibitions on promotion found in the Cannabis Act, it states that there are other acts and regulations that “could apply to cannabis”, but it doesn’t clearly specify what they are, provides only one example of possible legislation, and implores the reader to “consult any other legislation that may apply to their activities.”
In short, if you’re a cannabis company that’s looking to advertise, you better hire a lawyer.
At The Best Media, we never walk away from a challenge, and we’re ballsy, creative and open-minded enough to take on any cannabis company as a client. Contact us today and check out our cannabis marketing services for more info.