This is a post by Kath Mills
Opinions

The legalisation of recreational marijuana in America and Canada has opened the floodgates to a new-age gold rush. The global market is estimated to hit $31.4 billion by 2021 as more and more countries embrace the product. Major names across the pharma, retail, wellness, and food/beverage industries – for instance, Coca-Cola, Estee Lauder and high-end US department store Barneys – are all racing to score a piece of the lucrative field, while a host of new businesses catering to the budding industry is emerging every day.

In Australia, the medical marijuana industry is in its nascent stages following federal legalisation in 2016. While it’s now in a legal grey area, the tides are slowly beginning to turn – and it’s fascinating to watch a brand new field emerge within consumer products. Akin to booze after the Prohibition, this is virgin territory – empty space that will be subject to a frenzied land grab from both new and existing brands as they seek to ride the wave of shifting attitudes towards weed consumption. But how do you make pot truly fun for the whole family?

Learning from our American cousins

US start-ups in the cannabis space have focused on creating personalised or solution-based products that meet a consumer need – rather than simply spruiking a universal product. This may sound obvious but, in a category like marijuana, it is essential to cultivating a long-term, sustainable business opportunity.

In essence, the marketing of marijuana is likely to come down to education-based audience building. Marketers need to use education to clear the air and make this product area more accessible. This, in turn, will help break down the stigma associated with marijuana and drive audience acquisition that converts new customers, all while sustaining demand from existing users.

Educating the audience

The educational process is not simply a matter of producing instructional materials, but rather aiding users and non-users to introduce weed into their lives by demystifying an illicit or taboo product group.

To explain, we’ll need a little bit of chemical knowledge. Trimmed down, what we think of as ‘recreational’ marijuana contains larger traces of THC, a psychoactive oil, which is what creates the high. Medicinal marijuana, typically coming from hemp, contains very little THC and far more CBD – spruiked for its calming and medicinal effects.

It’s easy to imagine a scenario in which the importance of education is brought into sharp focus. The right strain of CBD-high cannabis delivered as an ingestible tincture can alleviate aches and pains, assist with epilepsy and schizophrenia, and reduce reliance on pricey prescription drugs. Strong education will make sure that is the actual customer perception, rather than an arthritic grandparent mistakenly getting blazed on ‘Alaskan Thunder F*ck’ – or something similarly ‘dank’ – and never touching weed again.

So, educating a customer on both the product varieties and their effects is essential to ensuring they purchase the correct product, enjoy it, and go on to become repeat customers.

Connecting the right customer to the right product

Understanding what customers want and introducing them to a product that works goes way beyond education around chemical formulation. Many brands, for instance, have recognised that a primary barrier to entry for consumers lies not in the marijuana product itself, but in the method of consumption. Smoking weed carries a host of explicit and implicit cultural signals that discourages a huge swathe of potential customers. To combat this, there are now a host of products such as tinctures, soup mixes, coffee syrups, bath salts, lollies and arm patches. Indeed, as Quartz reports, nobody smokes their weed anymore, and in Washington, smokable marijuana now accounts for less than 60% of sales, compared to 75% less than two years ago.

Start-up Fleur De Marche is tackling retail strategy, creating a female-centric high-end online retailer dubbed the ‘Sephora of CBD’. Despite the Cannabis Consumers Coalition finding that women consume cannabis as frequently as men, it appears women are more inhibited by the lack of social permissibility of the product. Accordingly, the former GOOP employees developed an education and retail platform intended to speak to female consumers about cannabis “in terms that feel relevant to their lives and needs, and deliver an experience that specifically addresses how she thinks and shops”.

Mothers, for instance, are increasingly seeking marijuana in all its forms to deal with everything from the mental stresses of motherhood, to pain relief, to menstrual cramps. In response, Fleur De Marche have produced a selection of starter kits to tackle four separate issues – sleep, anxiety, period pain and skincare woes – each packaged in canvas totes reminiscent of toiletry bags.

Positioning for tribes

Legalisation has opened the doors for marketers, but there are still a few challenges for those looking to make marijuana mainstream. A lot of successful brand building has focused on countering long-held beliefs and judgments about both the product and the kind of person who uses it, as well as aligning products to pre-existing customer segments to aide uptake.

And it’s working. Weed isn’t just for your basement-dwelling stoner bro anymore, with a 2016 study finding that, in the US, 84% of cannabis consumers are employed full-time, and 65% have a household income of $75,000 or more – $15,961 above the average at that time.

So let’s have a look at the pre-existing customer segments the industry has targeted so well. In line with macro trends of premiumisation and healthy living, savvy marijuana marketers are positioning their product to reflect consumer desire for enhanced authenticity – and service their need for natural, quality products.

For example, new weed brands are driving social permissibility amongst the ‘urban sophisticate’ audience through packaging and messaging that closely emulates luxury skincare or gourmet foods, creating associations with aspirational lifestyle brands and premium quality products. Beboe, aka the ‘Hermès of marijuana’ offers what the brand hilariously calls “the cold-pressed juice” of weed in the form of peach-tinned pastilles or through rose-gold vaporisers. Introducing a degree of elegance and wellness into these products challenges the implicit stigmas clouding the product group.

On the other end of the spectrum, with a more masculine perspective, the ‘craft cannabis’ movement is introducing users to the terpene and provenance of blends. Packaged in a similar manner to the craft-alcohol trend, this artisanal spin on marijuana attracts discerning consumers interested in quantifying the quality of their weed. By placing an emphasis on the artisan heritage of their products, craft cannabis brands not only pitch themselves as a premium product for savvy consumers but also bolster themselves with ‘authenticity’ against the inevitable monopolising force of ‘big cannabis’ as the industry grows.

Fittingly to this tribe, filmmaker and vintner Francis Ford Coppola – who directed The Godfather and Apocalypse Now – is launching a cannabis lifestyle brand called the Grower’s Series.

Girt by potential

So, let’s be blunt. Admittedly Australia is deliriously slow in its embrace of rolling global shifts – we got there eventually with marriage equality – and some states take a pretty conservative stance on recreation, so there is time before a fully realised legal marijuana industry presents itself to the Australian market.

That being said, change is in the air. And Australia is well positioned to blaze a trail for itself. Our international reputation for natural produce, our agricultural strength, our laidback attitude – all neatly correspond to the kind of language and feel that premium cannabis brands in the US have tried to tie themselves to. Couple this with our strong track record for building and exporting retail brands that reflect our abundant natural riches – say an Aesop or Penfolds Wines – and the opportunities are clear.