The Challenges of Compliant Cannabis Marketing

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Article date

September 26, 2023

Why managing AI risk presents new challenges

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The difficult of using AI to improve risk management

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How to bring AI into managing risk

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Pros and cons of using AI to manage risks

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Benefits and opportunities for risk managers applying AI

If you're considering entering the cannabis industry, know that marketing will play a significant role in your business. There are so many different types of marketing you can rely on. There’s word-of-mouth marketing, guerilla marketing, traditional advertising, blogs or SEO, and social media marketing. All these marketing methods must comply with both state and federal regulations. For the purpose of this article, we’ll be focusing on federal regulations and guidelines.

Stringent Marketing Regulations for Cannabis Products

How to market cannabis products legally involves a nuanced understanding of both federal and state regulations, as well as the specific policies of various advertising platforms. The marketing of cannabis products is subject to strict regulations to prevent misleading claims, protect public health, and ensure responsible advertising practices.

For example, since cannabis is a controlled substance, targeting minors is clearly off-limits. When creating your verbiage for social posts, ads, etc. You need to be careful not to use language indicative of minors. Speaking of social posts, there are also individual social platforms’ policies and guidelines you’ll have to abide by.

Instagram, TikTok, YouTube, and Meta, formerly Facebook, all strictly prohibit the promotion of cannabis products. X, formerly Twitter, allows the promotion of cannabis-related products but only from legally registered businesses. Meta allows the promotion of CBD products. YouTube, Instagram, and TikTok may allow educational content. All other forms of media seemingly promoting cannabis are strictly against the platform's terms of service.

Controlled Substances Act: Cannabis is still classified as a Schedule I drug, which means that promoting its sale can technically be seen as promoting the sale of an illegal substance. U.S. Postal Service: As a federal service, mailing advertisements for cannabis products is currently prohibited. Digital Advertising: Many digital advertising platforms, including Google AdWords and Facebook, prohibit the advertisement of drugs, which includes cannabis, due to its federal status. State Cannabis Regulatory Agency: Each state that has legalized cannabis for medical and/or recreational use typically has an agency or bureau tasked with overseeing the cannabis industry. This agency is often the primary source for all cannabis-related regulations, including marketing and advertising. A few examples of existing agencies include:

California: Bureau of Cannabis Control (BCC)

Colorado: Marijuana Enforcement Division (MED)

Washington: Liquor and Cannabis Board (LCB) A quick internet search for "[State Name] cannabis regulatory agency" or "[State Name] cannabis regulations" will typically lead you to the appropriate agency's website.

State Legislature Websites: Most state websites offer digital versions of all active laws and regulations, which can be helpful for understanding cannabis marketing rules. Cannabis Industry Associations: Many states have cannabis industry associations that offer resources, guidelines, and updates on state-specific cannabis regulations. For example:

California Cannabis Industry Association (CCIA)

Colorado Cannabis Chamber of Commerce

National Cannabis Industry Association (covers multiple states) Legal Databases: Websites like Westlaw and LexisNexis provide comprehensive legal information and are commonly used by legal professionals. While they may require a subscription or fee, they offer detailed and up-to-date information on state regulations. Consult a Local Cannabis Attorney: If in doubt, or if you want to ensure total compliance, consider consulting a local attorney who specializes in cannabis law. They will have up-to-date knowledge of current regulations and can provide specific advice tailored to individual needs. Cannabis Industry Publications: Websites like Marijuana Business Daily or Leafly often have news and articles related to state-specific cannabis regulations and changes in the law. Workshops and Seminars: Especially in states where cannabis is newly legal, there are often workshops and seminars provided by legal experts or state officials. These are designed to help industry participants understand and comply with local regulations.

Key Cannabis Regulations and Resources

Challenges of cannabis advertising include navigating a labyrinth of federal and state regulations, adhering to platform-specific policies, and finding creative ways to engage consumers without making unverified health claims. Equipped with the right sources, businesses can successfully traverse the intricate landscape of cannabis marketing. However, mere knowledge of where to find this information isn't enough. Transitioning from discovery to application, it's vital to grasp the key regulations that govern cannabis advertising. Let's delve into the cardinal rules and stipulations that every cannabis marketer should have at their fingertips.

Some of the key regulations include:

Avoiding Health Claims: Businesses must refrain from making specific health claims about cannabis or CBD products, as these claims require substantial scientific evidence and approval from regulatory bodies. This ensures that consumers are not misled by exaggerated or unverified health claims.

Not Targeting Minors: Marketing efforts should not be directed towards minors or depict cannabis consumption as something appealing to children or adolescent teens. This includes avoiding the use of animation or characters that might attract a younger audience.

Adhering to State-Specific Legality: Cannabis marketing must comply with state-specific laws, as regulations can vary significantly from one state to another. Businesses must be aware of the legal requirements in each jurisdiction where they operate and tailor their marketing strategies accordingly.

Please note that marketing regulations can vary over time and across different jurisdictions. It is important to consult the latest regulations and legal guidelines specific to the target market before implementing any marketing campaigns.

There are several reliable resources that provide information on marketing regulations for controlled substances like cannabis-related merchandise. Here are some recommended sources to learn more about the topic:

Official Government Websites: Visit the official websites of regulatory authorities such as the U.S. Food and Drug Administration (FDA), the Drug Enforcement Administration (DEA), and state-level cannabis regulatory bodies. These websites often provide guidance and resources regarding marketing regulations and compliance requirements for controlled substances.

State Cannabis Regulatory Websites: Each state that has legalized cannabis typically has a regulatory agency or department overseeing the industry. Exploring their websites can provide specific information on marketing regulations, advertising restrictions, and compliance guidelines applicable to cannabis-related merchandise within that state.

Industry Associations: Cannabis industry associations like the National Cannabis Industry Association (NCIA) and the Cannabis Marketing Association (CMA) often provide resources, educational materials, and updates on marketing regulations within the industry. They may also offer networking opportunities and access to industry experts who can provide guidance on compliance and marketing best practices.

Legal and Regulatory Publications: Legal publications and regulatory newsletters that focus on the cannabis industry can provide valuable insights into marketing regulations and compliance. Examples include publications like Cannabis Business Times, Marijuana Business Daily, and industry-specific legal publications.

Legal Counsel and Compliance Consultants: Seeking guidance from legal professionals specializing in cannabis law and compliance consultants familiar with the industry can provide tailored advice and insights into marketing regulations for cannabis-related merchandise. They can offer in-depth knowledge of the specific regulations and help navigate the complex landscape of advertising and marketing compliance.

Showcasing Successful Cannabis Marketing Campaigns

Amidst the myriad of regulations and restrictions, a few brands have managed to strike the perfect balance between creativity, consumer engagement, and legal adherence. Let's spotlight some standout cannabis marketing campaigns that not only resonated with their target audience but also set a gold standard for innovative and compliant promotional strategies.

Even Higher Together by WeedMaps: WeedMaps, a popular cannabis-focused platform, launched the "Even Higher Together" campaign on April 20th (4/20) to celebrate cannabis culture and promote community engagement. The campaign aimed to foster inclusivity, highlight social justice initiatives, and provide resources for cannabis consumers. Through digital and social media channels, WeedMaps successfully reached its target audience and promoted responsible cannabis use within legal frameworks.

Hemp In History: Abraham Lincoln by Hempfire: Hempfire, an innovative cannabis company, launched the "Hemp In History" campaign, which celebrated the historical significance of hemp and its potential for various applications. The campaign showcased how hemp was used during Abraham Lincoln's time and highlighted the sustainable and versatile nature of the plant. By weaving historical narratives with contemporary messages, Hempfire effectively engaged its audience while complying with marketing regulations.

"Forget Stoner" by MedMen: This campaign aimed to challenge and redefine stereotypes associated with cannabis users. MedMen, a cannabis retailer, showcased diverse individuals who consume cannabis, including grandmothers, former NFL players, and professionals, helping to destigmatize and normalize cannabis use.

"Sleepytime" by Dosist: Dosist, known for its dose-controlled vape pens, launched a campaign to promote its sleep formula. The ads, which were minimalist and sleek, focused on the therapeutic benefits of cannabis, particularly its ability to help with insomnia, and they were careful not to make specific health claims that would breach regulations.

"New Normal" by MedMen (again): This campaign was a cinematic journey through America's history with cannabis, portraying it as part of the "new normal". Produced by the acclaimed filmmaker Spike Jonze, it was a bold statement about the evolving perceptions and role of cannabis in American society.

"Spark Something" by Surterra Wellness: This campaign celebrated the individual reasons why consumers use cannabis, whether for wellness, relaxation, or creativity. It emphasized the idea of personal choice and the diverse array of benefits that cannabis offers to different people.

PAX Era Device Launch: PAX Labs, known for their vaping devices, managed to create buzz and excitement around the launch of their PAX Era device without directly advertising cannabis. They focused on the technology, the user experience, and the design, ensuring that the product was at the center of their promotional activities.

Charlotte's Web CBD Campaigns: Charlotte's Web, one of the leading CBD brands, often utilizes storytelling in their marketing, sharing real stories of families and individuals who have benefited from their products. These human-centric campaigns have been pivotal in building trust and credibility for the brand.

Remember, these successful campaigns have been meticulously crafted to navigate the complex regulatory landscape of cannabis advertising. Anyone considering a marketing venture in the cannabis space should have a thorough understanding of the regulatory landscape, or collaborate with experts who do.

Conclusion

As we've seen, while the regulatory landscape can seem daunting, it also paves the way for innovation, creativity, and a deepened commitment to ethics and responsibility. Brands that not only understand but embrace these regulations are the ones that will lead the industry, forging a path that combines business success with responsible consumer engagement. As the cannabis market continues to grow, those who prioritize compliance and innovation in their marketing strategies will undoubtedly rise above the competition, setting a standard for others to follow.

Read our case study regarding our Compliant Cannabis POS system . While Artis IQ is expanding into other industries, its original concept was designed to alleviate the challenges associated with cannabis dispensaries.

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Frequently Asked Questions

1. Is cannabis legal in the U.S. on a federal level?

Answer: As of my last update in September 2021, cannabis is illegal under federal law in the United States and is classified as a Schedule I substance under the Controlled Substances Act. However, individual states have passed laws that legalize cannabis for medicinal and/or recreational use. Source: U.S. Drug Enforcement Administration (DEA).

2. Can cannabis companies advertise on social media platforms like Facebook or Instagram?

Answer: Most mainstream social media platforms, such as Facebook and Instagram, have policies that prohibit the promotion of illegal drugs, including cannabis. However, educational content and advocacy may be allowed. Source: Facebook Advertising Policies, Instagram Community Guidelines.

3. What are the regulations around cannabis marketing?

Answer: Cannabis marketing is regulated at both the federal and state levels and must adhere to specific guidelines, such as not targeting minors or making unverified health claims. Source: Federal Trade Commission (FTC), state-level cannabis regulatory agencies.

4. Are CBD products subject to the same regulations as THC products?

Answer: CBD (Cannabidiol) is generally subject to less stringent regulations compared to THC-rich products. However, the FDA still has regulations that apply to CBD marketing. Source: U.S. Food and Drug Administration (FDA).

5. Can you mail cannabis products within states where it's legal?

Answer: No, mailing cannabis products is illegal as the U.S. Postal Service is a federal entity, and cannabis is illegal under federal law. Source: U.S. Postal Service.

6. What types of marketing strategies are generally considered safe for cannabis companies?

Answer: Content marketing, educational materials, and public relations campaigns are often considered safe strategies for cannabis companies. However, all materials should be reviewed for compliance with local and federal laws. Source: National Cannabis Industry Association (NCIA).

7. Is it legal to invest in cannabis companies?

Answer: Yes, it is legal to invest in cannabis companies that are compliant with state laws, but investors should be aware that these investments come with a unique set of risks due to the federal illegality. Source: U.S. Securities and Exchange Commission (SEC).

8. Can banks provide services to cannabis businesses?

Answer: The legality is complex. Due to the federal status of cannabis, many banks are hesitant to provide services to cannabis-related businesses. However, some state-chartered banks and credit unions do serve the industry. Source: Federal Reserve, state banking authorities.

9. What taxes apply to cannabis businesses?

Answer: Cannabis businesses are subject to a variety of taxes, including sales taxes, excise taxes, and income taxes, which vary by jurisdiction. Source: Internal Revenue Service (IRS), state tax agencies.

10. How can one ensure that a cannabis business is fully compliant with the law?

Answer: Consulting with legal experts specializing in cannabis law, following state regulatory guidelines, and keeping updated with any changes in local or federal law are essential steps. Source: Legal experts, state cannabis regulatory agencies.

Please note that information related to the cannabis industry changes frequently, so it's essential to consult with experts and official sources for the most current information.