First round of investment funds is secured (check). A Research & Development Lab opened (check). Management team is formed (check). The PR Newswire releases start churning (check). Companies are overvalued and profits are a dream in the future (check). Sound familiar? Welcome to the next tech boom. The cannabis frontier has arrived and it’s impossible to ignore.
Why? The numbers speak volumes:
• In 2016, legal cannabis sales totaled $6 billion; in 2026 that number is expected to increase to $50 billion. In October 2020, Canada’s monthly sales reached an all-time high of $270 million, a dramatic increase from the $180 million recorded just six months earlier.
• Cannabis became an attractive option for people spending more time at home, both for entertainment and to reduce stress and anxiety. The cherry on top: Cannabis was designated an essential business at the start of COVID-19, helping the industry to thrive this year.
• Almost 70 percent of Americans fully support the full legalization of cannabis and with local and state tax coffers depleted, more and more states will go green. Just look at California, which is expected to pull in $6 billion in sales in 2021 alone, followed by Colorado ($1.8B), Florida ($1.8B in medical only), Illinois ($1.7B), Michigan ($1.5B), and Massachusetts ($1.4B). New Jersey is just getting started and its close sibling across the river will be next. Those two markets alone are expected to exceed the aggregate of all current legal sales.
• South of the border, Mexico will soon be making history with cannabis legalization as the third country in the world to legalize recreational cannabis, while all eyes are on the European cannabis market.
• CBD products, once considered a niche product, have moved into the mainstream and can be found in skincare, makeup and a long list of consumer packaged goods.
So, what can PR professionals do to leverage this market in a sane and sustainable way—and not fall prey to the over-ambitious growth, and in many cases failures of the tech industry?
Do your due diligence and make sure the cannabis companies that you are speaking to have cash flow, a path to profitability, and a strong internal regulatory framework. There is no room in the cannabis supply chain for errors. From labeling to manufacturing to child-proof packaging and quality control testing (Is the level of THC accurate in your edibles?), every aspect is critical to running a successful cannabis company. You want to work with companies that are paying attention to the details, big and small.
Make sure your social media adheres to the guidelines. Until cannabis is federally legal, Facebook and Instagram will not let you post about your product. It’s a fact. Sooner or later your client will be shut down and their social footprint will go, poof, if you’re not careful.
Don’t let your cannabis clients become a commodity. Wait for the right opportunities, staff accordingly, and execute campaigns with the same holistic view as other industry sectors.
Cannabis is budding, but there are still hurdles and stigmas when it comes to telling its story. If we shape a strong narrative and play our cards right, the green rush can be beneficial for us all.
Lori Rosen is president at Rosen Group.