Even without federal legalization, the cannabis industry is proving to be fast-growing in the U.S. In fact, despite being legal in fewer than a dozen states, consumer spending in the legal cannabis market is projected to hit $11 billion by the end of this year, and it’s projected to top $23 billion by 2022. This is according to Arcview Market Research and BDS Analytics’ The State of Legal Marijuana Markets, 6th Edition, as reported by Forbes.
Demand for the product isn’t the only driving force behind this success story, though. As more cannabis companies join the market, I believe e-commerce will continue to drive innovation throughout this growing industry in three ways.
1. Companies and customers can buy (almost) everything they need online. While cannabis itself isn’t available through online avenues, just about every other product tied to the industry is. This includes personal use items like bongs, pipes, rolling papers and vaporizers as well as growing supplies. Cannabis companies and customers are enjoying almost the same shopping experience found in just about every other industry, making the industry more accessible to everyone.
2. Engagement is happening on digital platforms. Based on my observations, a number of e-commerce platforms are directly helping the industry, as well. For example, LeafLink is a wholesale online marketplace and selling tools’ suite, and Baker is a CRM designed specifically for the cannabis industry.
3. Compensation technology is connecting — and protecting — everyone. Of course, the cannabis industry still faces barriers, not the least of which is legalization on the federal level. The specter of a Drug Enforcement Administration crackdown is still enough to keep banks from accommodating state-licensed sellers. While this is far from ideal, e-commerce has once again provided solutions like digital e-wallets designed to meet the financial needs of cannabis-industry professionals.
Six Digital Marketing Strategies Cannabis Companies Should Implement
With these three drivers in mind and based on my own experience in the e-commerce space, I see some specific areas where cannabis companies can find success in their digital marketing efforts.
1. Facebook Groups
Social media is still unfriendly (subscription required) to cannabis companies. None of the big platforms will support their ads, even when they’re for perfectly legal companies. Nonetheless, Facebook did recently lift its ban on marijuana-related pages. This is still a relatively new turn of events, so it will be interesting to see if cannabis companies can leverage this opportunity.
One way to use these social media groups would be to post links to helpful content, providing expert input of your own, on behalf of your brand.
2. Influencers
While many industries are just starting to realize how powerful an influencer’s endorsement can be, I’ve noticed that cannabis companies have been quick to adopt this e-commerce marketing practice. AdWeek even went so far as to call influencers “the secret to marketing marijuana” (subscription required).
Cannabis brands looking to work with influencers should find those who can help craft campaigns that are sensitive to current issues and won’t inadvertently get their social or ad account shut down. Important elements of a quality influencer or microinfluencer are someone who has grown their audience organically, creates original content and reports high levels of engagement and social reach with that audience.
3. SEO
Search engine optimization (SEO) strategies for cannabis companies are similar to those used in other industries. In fact, there are even specific companies out there that serve the unique SEO-related needs of this industry.
Dispensaries and brick-and-mortar shops can create a profile on Google My Business, making it easier for Google to understand what these companies offer and to show up on those all-important Google Maps.
Then, platforms like SEMRush and Ahrefs are helpful in finding relevant keywords people are searching for when they are in the market for cannabis-related products.
4. Affiliate Marketing
Affiliate marketing has long been a fantastic and affordable marketing method, so it makes sense that many cannabis companies offer these programs.
Best of all, a cannabis company only needs to list the details for its affiliate program on its website to start recruiting marketers to work purely on commission. Companies can also actively promote their affiliate programs by contacting influencers, joining affiliate networks or buying space on websites frequented by cannabis users.
5. Local Directories
In any state that legalizes marijuana — either for adult or medicinal use — dispensaries begin popping up everywhere.
While this is great for people who want to purchase cannabis products, it also poses a bit of a challenge. Cannabis connoisseurs are a lot like beer lovers when it comes to their breweries: They like to put a lot of thought into the dispensaries they’ll frequent.
With dozens of cannabis-specific online directories out there, it’s worth ensuring your business is listed so that potential customers have another avenue to find you. Aside from that obvious benefit, directories are great for SEO.
6. Apps
No industry can be said to fully embrace the potential of e-commerce until it’s flooded with apps. Popular social media apps in this space include MassRoots and High There. Another popular app, called MyDx, is a diagnostic app that comes with a companion device so users can test cannabis samples before imbibing.
Like all of the other aspects covered above, the introduction of apps is mirroring how so many e-commerce solutions have long helped other industries. These apps make it easier for users to find and enjoy cannabis products.
To better market your cannabis brand, you can either create your own branded app that helps promote push notifications, reminders, sale promos and highly personalized messages. Otherwise, consider purchasing ads on other popular apps like Leafly, Weedmaps or MassRoots to reach potential customers.
In many ways, the ongoing evolution of the cannabis industry has e-commerce to thank. At the same time, innovative e-commerce companies are breaking new ground, which may have never been done had it not been for the unique challenges facing the industry. Either way, the future should prove to be exciting for the marriage of e-commerce and cannabis.