Tag Archives: brand

The Great Cannabis Branding Conundrum in Europe

By Marguerite Arnold
2 Comments

Cannabranding is buzzy. In the United States and in Canada, it is a vertical that is developing fast along with the multi-billion dollar legitimizing cannabis market. In both the United States and Canada, digital marketing to promote brands is a hot topic.

Social media has firmly rolled over traditional advertising barriers even as it still remains a landmine. And if there were ever a “fun” brand to be associated with, cannabis carries a lot of plusses. Starting with the rapidly fading stigma. According to Adweek, there were 170 advertising and marketing agencies picking up national cannabis business in the United States, with additional firms serving smaller firms or markets at the beginning of the year.

Yet battles that should be dated with the year 2017 in the mirror, are still raging and underway even in these jurisdictions. No matter what or where, advertising remains complicated. Beyond the American hemisphere, the issue of branding is a still-slumbering giant that may yet awake in the second part of the next decade. For the most part, that will have to await the advent of recreational use, at least within Europe.Are there successful brands already established in the world of cannabis? Of course.

How brands enter the market in the EU in fact, based on their social media and internet influence elsewhere, is very much a part of that discussion. So far in Europe, there has been no federal recreational reform. Medical use is still in front of legislatures. As a result, that means that more traditional social media efforts in particular, are verboten when launched in country.

With foreign firms now entering the EU market, the big question is, can such firms establish a brand presence here (or for any of their products?) Or will that too, be launched from abroad?

And how exactly will that fare in Europe, particularly in places like Germany, where the overwhelming pressure is on to treat cannabis just like another narcotic? And in particular, a generic drug.

A Brief History of Advertising in Cannabis

Hard as it is to believe, just four years ago, there was no legal, functioning recreational market anywhere. Weedmaps and Leafly were the only game in town when it came to advertising, along with growing free press coverage, in particular for small companies who were starting to establish market presence in the legalizing cannabis business. In fact Weedmaps and Leafly can be effectively credited, certainly in the United States, with putting cannabis advertising, along with dispensaries and prescribing doctors, on the map.

The impact of a California media industry on this issue, especially with state recreational legalization imminent, cannot be underestimated. However, these days, it is not the only game in town.

Fast forward to 2017, and the world of cannabranding has exploded, no surprise, in the world of social media. “Bud porn” proliferates on Instagram. In fact, an Instagram account, along with YouTube videos, Facebook posts and Twitter pictures are derigeur for pot companies these days as much as they are for anyone else. Free media is still a force.

However even here, the rules and enforcement of the same, at least in the United States, are still shadowed with uncertainty. Federal Schedule I status means that technically, even the big social media giants are in the same boat as traditional advertising mediums (like print or even internet-based media). Section 843 of the Controlled Substances Act specifically prohibits “communications facilities” from advertising Schedule I drugs. However the internet has never really been brought under FCC guidelines – and on many fronts. See “bud porn”, as the first example. Cannabis “advertising” such as it has clearly developed, is absolutely another one.

And into this gap have poured cannabis-branding initiatives galore. One of the most corporately ambitious so far? Netflix, with not only pot-branded entertainment, but its own brands of cannabis. It is far from the only one. Google Adwords also changed its policies with regard to medical advertising this year. The advent of a recreational market in California will absolutely drive this issue globally. But beyond California state borders, how will more local laws be enforced? And by whom? Is anyone at the FCC or Jeff Sessions’ Justice Department considering the national impact of any cannabis branding launched in California, for example? And where would they start? Would corporate advertising that is present at national conferences be targeted too? Along with the growing cannabisHow will such firms establish branding in a world so totally off-limits to “brand” advertising? conference economy itself which is already multi-state? The situation is already slippery. Abroad, could or would BfArM, the German federal agency overseeing the regulation of narcotic drugs (including cannabis), bring suit against Facebook for distributing California-sourced advertising for an Australian firm now doing business in Europe?

Clearly, there are landmines everywhere one looks. And not just for the big guys. The path is still littered with issues and problems for smaller, U.S.-based initiatives. Accounts can be blocked arbitrarily on social media and have been, such as on Facebook. In sum, however, it is also very clear that the preponderance of a tide is shifting. The industry as well as internet-based branding, is winning.

Especially as recreational reform blooms in Canada and California.

Advertising, in a digital world, has no borders. And cannabis branding is about to test exactly how accurate that mantra is. Or at least how much the location of one’s server counts. And it may be that because of this issue, the entire enchilada is about to jump the shark, if not a few international borders.

The Awakening Canadian Giant

North of the American border, the great Canadian recreational cannabis experiment is more than just in the offing. The train is puffing with steam at the station. The impact of a federally legal, recreational market that Canada will become as of next summer, cannot be underestimated from the advertising and branding front.

First, it means that Canadian companies will be able to advertise and promote their brands to at least a domestic audience. Granted, they will undoubtedly face the same issues as liquor companies in some ways. But promoting specific brands and labels has already hit the Canadian social media universe. See the efforts of all the major pot-producing companies with domestic server and corporate presence.

In turn, this has further opened another question. If digital and social media has no boundaries, what does that mean for the rest of the world? Particularly those countries now also watching the larger Canadian corporates establish both growing and distribution presence within their borders, and with strict advertising bans on cannabis domestically. That includes bans on advertising marijuana as medicine.

The Most Compelling Cannabis Brand Remains Legalization

Are there successful brands already established in the world of cannabis? Of course. Think only of the many celebrity-backed brands (even for medical) that you have probably heard of in the last few years. There are likely to be more.

However the reality is that in many jurisdictions, starting with Germany, such branding theoretically at least, stops at the border. The many firms who are establishing presence here on the distribution and potentially cultivation side, do nothing more than promote their company names at industry events.

How will such firms establish branding in a world so totally off-limits to “brand” advertising?

For now, one of those answers is to establish a presence as a serious pharmaceutical company. Another of course, is to become more vocal over the need for further reform and patient access. So far, that issue has remained one mostly vocalized by reform groups on the ground. That could change, particularly with further delays in implementing medical programs in Europe. Celebrity-backed appearances in media on this issue go far.

And for the meantime? Branding specialists will have to hope that advertising campaigns developed off-shore begin to meet targeted European patient groups.

Even if the first message is the concept of cannabis as legitimate medicine.

New Drug Delivery Mechanisms For Cannabis Products

By Aaron G. Biros
No Comments

Next Frontier Biosciences announced the launch of their new product line, Verra Wellness, in the Colorado market this week. The products are designed with relatively new concepts for the cannabis market, including nasal, sublingual and topical administration.

The company claims their product is the first-ever cannabis nasal mist. Co-founded by biotech executives Marc Graboyes and Dr. Paul Johnson, Ph.D, Next Frontier Biosciences is developing this product line with three formulations, each with a different ratio of THC and CBD. According to a press release, Next Frontier Biosciences is focused on developing cannabis products with these new drug delivery methods, and even offering a microdosing option.

“We believe that leveraging science and research is the key to optimizing product development,” says Dr. Johnson, one of the co-founders. “With the introduction of our Verra Wellness line of products, we are reshaping the cannabis industry by offering trusted products that provide uniform composition, formulation and dosing in highly consistent modes of administration.”

Their topical salves in the Verra Wellness product line are “designed to permeate skin and muscle tissue deeply without penetrating the blood stream or causing psychoactive effects,” reads a press release. In addition to the nasal mist and topical salve, they also launched a sublingual spray.

Marc Graboyes, chief executive officer and co-founder of Next Frontier Biosciences

According to Marc Graboyes, chief executive officer and co-founder of Next Frontier Biosciences, drug delivery mechanisms like a nasal mist are superior to smoking, vaporizing and edible administration. “Nasal administration is among the most effective delivery technologies due to the extensive vascularization and large surface area of the nasal cavity, allowing for rapid uptake and reliable results,” says Graboyes. “The cannabis nasal mist is a novel technology that other brands have not yet tapped into.”

He says this drug delivery mechanism is efficient, fast acting and a healthy alternative to smoking. “For many, nasal delivery is a desirable alternative delivery mechanism because it does not present the health risks associated with smoking,” says Graboyes. “In addition, as previously mentioned, the large surface area of the nasal cavity permits high drug absorption, and the fine-mist sprayer allows for accurate, consistent dosing and an excellent safety profile. Further, nasal delivery avoids first-pass metabolism by the liver, where a large fraction of orally delivered cannabinoids are inactivated.”

While the Verra Wellness product line is available in Colorado starting this week, the company has plans to expand into a number of other states as well. “We are executing a multi-state expansion, with plans to move into the California, Oregon, Washington and Nevada markets in the coming year,” says Graboyes.

Exploring Opportunities in Emerging Markets

By Aaron G. Biros
No Comments

This November 8th, voters in five states will head to the polls to decide on legalizing recreational cannabis and another three states have ballot initiatives that would legalize medical cannabis. If any of those five states pass a measure for recreational legalization, including Massachusetts, Maine, Nevada, Arizona and California, (which are all leading in the polls) they could potentially create massive new market opportunities for cannabis brands that have their eye on expansion.

Nancy Whiteman, co-owner of Wana Brands and chair of the Cannabis Business Alliance Infused Product Committee, sees great potential in capitalizing on those markets early. Whiteman has been working with Wana Brands since 2010 in Colorado, starting out in the young medical market there.

Nancy Whiteman holding a batch of cannabis gummies
Nancy Whiteman holding a batch of cannabis gummies

After expanding to the recreational market, Wana Brands saw its sales skyrocket. From January to August 2016, Wana had the best-selling candy brand in Colorado with 21% dollar share, according to BDS Analytics. Wana Brands has already expanded to Oregon and will launch in Nevada on November 15th, with agreements signed to expand in other states as well. “The model we are pursuing is a licensing agreement where we partner with existing or new license holders in their state,” says Whiteman. “In many ways they are doing the heavy lifting, but we are providing an enormous lift by licensing our intellectual property to them.” That model for growth is becoming increasingly common in some of the more established brands, like Steep Hill Laboratories, GFarma Labs, Dixie and others. Whiteman says that Wana Brands also has a partner in Illinois, Massachusetts and a number of other states they hope to reach.

Mark Slaugh, CEO of iComply
Mark Slaugh, CEO of iComply

According to Mark Slaugh, executive director of the Cannabis Business Alliance and chief executive officer of iComply, a compliance services provider, brands from Colorado expanding to other states need to ask themselves if their reputation is on the line with these new operators. “If you are licensing to companies that are not compliant, the penalties could be huge and they vary state to state- that could potentially hurt the overall brand image nationally,” says Slaugh. “People doing the licensing that are operating with full compliance really need to look at controlling that risk and mitigating that as much as possible.” With brand trust on the line, there are substantial risks that come with expansion. “We help clients ensure quality is consistent so, for example, an edible product would taste the same in Colorado as it would in Nevada or Arizona. They need to follow the intellectual property consistently but more importantly follow those specific regulations in that state to stay afloat.” Managing ongoing compliance in different states requires monitoring regulatory updates across multiple markets, which can get incredibly complex.

rsz_unspecified-3
Processing SOPs vary widely stae to state

“Six years ago, it was much easier to get into the market in Colorado,” says Whiteman. “There were no capital requirements, no limits on the number of licenses, but there was still a lengthy application and vetting process- as long as you met those minimum requirements you could get a license.” Other new states put stringent limits on the number of licenses granted and some have extraordinarily cost-prohibitive capital requirements, up to a million dollars, as is the case for New York. “Anyone who becomes a license holder in Massachusetts has to be prepared to embark on three separate business models, which is a massive undertaking,” says Whiteman. Massachusetts requires license holders to cultivate, process and dispense in a vertically integrated model.

In other states, Wana Brands is working with exclusive partners who will have the capabilities to manufacture and distribute throughout the entire state, but in Massachusetts that won’t be the case. “To cover the state, we need several partnerships; the partner we are working with is a little south of Boston,” says Whiteman. But all that could change if voters in Massachusetts legalize it recreationally, opening a much larger market than the current medical program. “With no legislation drafted yet, the regulatory environment is still up in the air in Massachusetts so there is no way of telling what the recreational market will look like.” In terms of ongoing regulatory compliance, Whiteman believes that Colorado still has some of the most stringent rules. The universal symbol printed on every individual edible product serving is one example. “Every state has different lab testing and licensing requirements, but Colorado looks like the most stringent currently,” says Whiteman. “Colorado requires a full gamut of lab testing including homogeneity, potency, residual solvents, contaminants and soon pesticides too.” According to Mark Slaugh, Nevada’s lab testing regulations are fundamentally different from Colorado’s with regard to sampling procedures, but the broader inconsistencies in lab standards need to be addressed. “The lack of laboratory standardization state to state with regard to methods creates a big challenge to get consistent, proficient lab testing across the board,” says Slaugh.

Wana's edibles come stamped with the universal symbol (THC!)
Wana’s edibles come stamped with the universal symbol (THC!) in Colorado, as required by law.

A big differentiator between Colorado and other states is that it was a first mover. “When Colorado came online there were not any established brands to speak of anywhere in the country- we were all pioneers,” says Whiteman. “Because it is so difficult to get a license in another state, either the organization or investor groups are looking to partner with established brands.” The advantages to this business model are many. Expediting your entry to market gets you the advantage of being a first mover. Working with an established brand also minimizes risks and the learning curve. “Bigger players understand that building a brand from scratch is time consuming and expensive so I think we will see a lot of these partnerships.”

As those new states come online, similarities in their regulations might appear in the form of standard operating procedures (SOPs) or good manufacturing practices (GMPs). “We might start to see a standardization from state to state that models FDA GMPs or USDA GAPs, [good agricultural practices] moving toward a framework that is more consistent with the possibility of federal regulation,” says Slaugh. Another commonality among a number of states is the implementation of a statewide tracking system. According to Slaugh, California has no such mandated system in place yet. “They will probably have one eventually but the market is so localized there- we will see if California will be ready with a statewide compliance system for tracking by 2018,” says Slaugh. “With such a weird patchwork of local governments allowing or not allowing certain operations to exist, it is a tough business to be in and it’s getting tougher every day.”

Adam Jacques and Team Launch Sproutly, Dispensary in Eugene, Oregon

By Aaron G. Biros
No Comments

sproutly signAdam Jacques and his team officially launched the newest arm of their business last week, Sproutly, a dispensary located in Eugene, Oregon. “This is an extension of what the Grower’s Guild Gardens does and what the Microgrower’s Guild was,” says Jacques. The Grower’s Guild Gardens, Jacques’ award-winning cultivation business, is known for their high-CBD genetics and patient-focused work, most notably with Leni Young, which helped lead to the passing of legislation in Alabama called Leni’s Law, decriminalizing the possession of cannabis oil for patients in the state.

The shelves of Sproutly boast over 75 strains of cannabis from Jacques' farm.
Sproutly’s shelves boast over 75 strains of cannabis from Jacques’ farm.

Sproutly is a medical and recreational dispensary that boasts a wide variety of high-CBD strains, a reflection of the team’s focus in the past. “We are extremely medically focused with a variety of unique CBD strains in stock,” says Jacques. “First and foremost are the patients, but entering the recreational market means we will be carrying a wider variety.” The opening of the dispensary is well timed as the team received their Tier II cultivation license, allowing them to grow cannabis up to 20,000 square feet in an outdoor space and 5,000 square feet indoor. So in addition to the handful of brands they carry, including Lunchbox Alchemy edibles, Northwest Kind and Marley Naturals, they also carry over 75 strains from their own Grower’s Guild Gardens.

Adam Jacques in front of a display shelf at Sproutly.
Adam Jacques in front of a display shelf at Sproutly.

Adam and Debra Jacques pride themselves in rigid standards for quality in sourcing, so it should be no surprise that they plan on supplying their dispensary with over 150 strains coming from more than 1,200 plants on their farm. “We really only take products from people we know and trust,” says Jacques. “That is why most of the flower in the dispensary is coming from our farm, so we know exactly what is going into it.” Jacques points to third-party certifications such as Clean Green, for other vendors to find reputable growers. “I need to know where it is coming from and that requires a personal relationship to trust the quality of their products.” The value of trust and personal relationships is also why they go through extensive training of their staff, using their own expertise for in-house training.

rsz_img_6047

The team includes Chris West, Elton Prince and John De Kluyver, all of whom have a decade or more of experience cultivating cannabis and working with patients. “We take our bud tenders through training classes, they get tested on their knowledge of products and the science of cannabinoids and terpenes and how the combinations affect people differently,” says Jacques. By leveraging that high level of in-house expertise, the team prides themselves on customer service, helping patients and customers find the right strain or product that suits them best.

In the front of the dispensary, a receptionist greets patients or customers, checking identification and showing you to a bud tender. As you walk into the retail space, you immediately notice the professionalism of the staff, taking time to personalize each customer’s experience without making him or her feel rushed. The clean aesthetics, product selection and knowledgeable staff provide for a friendly retail culture without the common ‘stoner culture’ that usually follows.

Jacques and his team will not be trading in their overalls and work boots just yet as they are inching toward harvesting their 1,200 outdoor cannabis plants soon. Grinning ear-to-ear, Jacques showed off his Tier II cultivation license on the farm, and with it came a glimpse into their exciting growth.