How to launch a rec cannabis brand without defined marketing rules

“The entire industry is waiting on the government to set the regulations around marketing and advertising for the recreational market,” said Aphria’s director of communications Andrew Swartz

What will marketing efforts for recreational cannabis look like? It’s a good question: One that federal government regulators can’t yet answer, leaving Canada’s licensed cannabis producers in limbo as big budget plans and potential profits hang in the balance. With legal recreational marijuana looming on the horizon this summer (or later), Health Canada’s rules for important issues such as packaging and advertising restrictions remain undefined.

“The biggest issue is not that there is going to be rules. We expect that,” said Dave Bigioni, chief marketing officer for Canopy Growth, a large-scale licensed producer planning to supply recreational cannabis as a supplier and/or retailer in provinces across Canada. “But (it’s) just the timing. Packaging is one area that all the LPs (licensed producers) are waiting for final direction on, as are the retailers, so we are looking forward to being able to nail that down as we move forward.”

Tokyo Smoke intro kit

Reps at another major Canadian cannabis company, Aphria, also acknowledged the impact of unclear regulations.

“The entire industry is waiting on the government to set the regulations around marketing and advertising for the recreational market,” agreed Aphria’s director of communications Andrew Swartz. “Until that time, we are not able to discuss our plans, which will necessarily be shaped and guided by those regulations.”

Despite the uncertainty, marketing efforts are already ramping up. Leafs by Snoop, the American rapper-branded cannabis currently being distributed by Canopy to medical consumers and regulated by the Access to Cannabis for Medical Purposes Regulations (ACMPR), is slated for distribution to recreational cannabis consumers in Manitoba. But celebrity endorsements may be forbidden by as-yet unpublished ad regulations.

Aphria-backed Hiku Brands has taken another approach – upscale, targeted campaigns designed to smash stoner stereotypes and appeal to niche markets across the demographic spectrum. In early February, it was officially launched by CEO Alan Gertner, with sub-brands Van der Pop, DOJA and Tokyo Smoke each targeting a different kind of cannabis consumer.

“We feel that our carefully selected collection of brands each address a different demographic and their specific needs and wants from Canadians,” explained Josh Lyon, Hiku’s head of marketing and partnerships. “A good example of this is Van der Pop, positioned as addressing women's specific needs and wants from the cannabis industry.”

At present, the closest thing to a set of rules for recreational cannabis marketing is coming from the industry itself. Last November, The Coalition for Responsible Cannabis Branding, made up of 17 licensed Canadian cannabis producers (including Canopy and Aphria), the Canadian Medical Cannabis Council and Cannabis Canada Association released their own proposed guidelines (PDF). If they’re endorsed by the federal government, they would come into effect following legalization.

The recommendations operate from the principle that “marketing by LPs will only promote brand preference, and will not attempt to influence adult non-consumers of psychoactive cannabis products to become consumers.” Taking cues from restrictions on alcohol and tobacco advertising, the industry-generated guidelines also forbid things such as health claims and fictional or real characters designed to appeal to children.

Whatever the official rules are, we can be certain cannabis advertisers will be working from a constrained palette. “With respect to the marketing of the products we want to make sure that we have controlled the types of images that are on it, even colours of packaging, and we also want to make sure there’s no marketing that’s going to entice children to be attracted to the product,” said Health Minister Ginette Petitpas Taylor when responding to questions about marijuana legalization during a media scrum in Ottawa on November 21.

What’s likely is that recreational marijuana marketing will follow some of the trends that have emerged in the medicinal space with an emphasis on education. And with tight limits on ad content expected, the cannabis marketers are looking upon probable restrictions as a spur to their creativity.

“Like everyone in Canada, we're anticipating that there will be marketing restrictions that will require creative maneuvering to make sure our brand and products are well-known and top of mind,” said Hiku’s Josh Lyon.

Dave Bigioni, who was behind successful marketing campaigns in the tightly-regulated alcohol industry in his previous position with beer giant Molson Canada, offered this perspective: “Sometimes a tight box, a tight regulatory environment, you can either allow it to stifle you or allow you to flourish.”

Photo: Tokyo Smoke offered a limited edition introductory kit to medical consumers in 2017.

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