Marijuana Advertising Rules Challenge California Businesses

Since recreational marijuana became available for purchase in California in January 2018, the number of licensed marijuana businesses in the state has exploded giving more people access to marijuana products than ever before. However, just because recreational marijuana is now legal and available for purchase in California doesn’t mean that it’s easy for marijuana businesses to spread the word about their products to consumers.

Instead, there are a multitude of advertising rules and marketing challenges facing the marijuana industry, including in California where advertising regulations are strict and provide few opportunities for marijuana businesses to promote their brands and products to wide audiences.

California’s marijuana advertising and marketing restrictions can be found in the state’s Business and Professions Code (BPC), Division 10, Chapter 15 (26150-26156). Unfortunately, the restrictions are very limiting, and marijuana businesses that don’t comply with the regulations could face fines and penalties.

Recently, Weedmaps and California’s Bureau of Cannabis Control (BCC) have been in disagreement over a provision in the law that says, “A technology platform shall not display an advertisement by a licensee on an Internet Web page unless the advertisement displays the license number of the licensee.” Weedmaps believes the BCC has no authority over it since it is not licensed by the Bureau, and therefore, argues that it is free to display ads from unlicensed businesses. While a final decision hasn’t been made yet, it’s clear that marijuana advertising laws are far-reaching both within the marijuana industry and outside of it.

After reading the laws, one might wonder how a marijuana business can advertise in the state at all, because it seems like most marketing tactics are not allowed. Let’s take a closer look.

Here’s What California Laws Do Not Allow

Before you read any further, understand that I’m not an attorney specializing in marijuana business law. I highly recommend that you check with an attorney working in the marijuana industry before you invest in marketing initiatives to ensure you’ve interpreted the laws correctly and aren’t doing anything that could get you in trouble.

With that said, here’s what the law doesn’t allow marijuana businesses in California to do to promote their products and brands:

• You cannot use an ad or marketing piece unless the licensee responsible for it is legibly identified on it. At a minimum, the license number should be included. This includes print, outdoor, and digital ads and marketing.
• Ads placed on television (broadcast or cable), print, digital, or radio cannot be shown if at least 71.6% of the audience is not expected to be age 21 or older. You can determine this percentage using reliable and current audience composition data from the media publisher you’re working with.
• You cannot conduct advertising or marketing through individual communication or through any type of dialogue that you control unless you require audience members to verify their age first. Only people age 21 or older may engage with these communications or dialogues. You can get this verification by requiring people to disclose and confirm their birth dates or using another registration process. For example, you’d need to verify visitors’ ages before they view your website, just like liquor brands are required to do.
• You have to be truthful and cannot mislead consumers in any way.
• Your marketing messages cannot contradict information on your product labels and packaging.
• You cannot use any kind of marketing that makes people think your product came from a different location than where it actually originated from.
• You cannot advertise on a billboard or other location that is on an Interstate Highway or State Highway, and your ads cannot cross the California border.
• Your ads and marketing should not encourage anyone under the age of 21 to use marijuana products.
• Advertising signs cannot be within 1,000 feet of a school for kindergarten through grade 12 students, a day care center, a playground, or a youth center.
• You cannot give away any quantity of marijuana or marijuana-related products or accessories as part of a promotion or any other commercial activity.
• You cannot make any untrue claims in your marketing messages about how your products or marijuana in general can have any kind of effect on a person’s health.

5 Opportunities for Marijuana Marketing in California

Based on what’s not allowed, it’s challenging to come up with creative marketing ideas that marijuana businesses in California can legally use to raise awareness and recognition of their brands as well as increase sales and brand loyalty. As a marketing expert, I put on my thinking cap and came up with some opportunities based on how I’ve interpreted the laws.

1. Communicate with Data

You’re not allowed to make health claims in marijuana-related ads and marketing, so communicate with data instead by explaining what marijuana has been proven to do based on science. In other words, use research data and statistics in your messages rather than broad claims. It’s all about providing proof to back up your marketing messages.

For example, rather than saying, “Marijuana can reduce your stress,” say something like, “Research by ABC Institute found that marijuana reduces a person’s heart rate by 30%.” Keep in mind, I made up that research company and the statistic, but you get the point. Find research that supports the health claims you’d like to make, and allow people to draw the inferences from that data. That way, you don’t have to state any health claims specifically, but the connection should be obvious to most people.

2. Conduct Media Outreach

California law specifically states that marijuana advertising and marketing restrictions do not apply to editorials, such as news releases, “in any periodical or publication or newspaper for the publication of which no money or valuable consideration is paid or promised, directly or indirectly, by any licensee, and which is not written by or at the direction of the licensee.” That means there is an opportunity for marijuana businesses to raise brand awareness through editorial content.

When your business does something interesting, publish a news release about it, but don’t stop there. Try to get mentioned in editorials written by journalists. The trick is to build relationships with people online and offline who write editorial content that your audience is likely to read. Social media, networking, and direct outreach work extremely well.

Next, provide those writers with interesting information that will motivate them to write about a topic which is related to your business and products in some way. The hope is that they’ll include a quote from you or mention your business or brand in their articles. To do that, you can’t pitch self-promotional content ideas. Focus on being educational and/or newsworthy instead.

Journalists are unlikely to come to you for quotes and input on stories they’re working on unless you actively reach out to them with useful information. You need to continually remind them that you’re the go-to person on marijuana-related stories. The more often you’re mentioned in articles and other media publications, the more people will hear about your brand and become interested in it.

3. Email Marketing

Email marketing is essential to the marijuana industry. Build your email marketing list by offering free useful content that doesn’t advertise marijuana or your products. You can use the leads you collect from that free content to send email marketing messages which can turn into sales. Just make sure you follow email marketing best practices to ensure your messages are delivered and have the best chance of persuading recipients to take the actions you want them to.

Unfortunately, most email marketing service providers won’t work with marijuana-related businesses today. Even if they allow you to send messages at first, it’s likely that they’ll ban your account eventually. However, you can use the email marketing tool built into the Cannabiz Media License Database without fear of having your account banned without notice.

4. Hire Brand Ambassadors

If you can’t promote your own brand, let other people talk about it for you. For example, when you attend events, bring brand ambassadors. For guerilla marketing on a local level, create a street team filled with brand ambassadors.

You can also consider working with a celebrity to promote your product. If a celebrity with a lot of followers on sites like Twitter and Instagram take pictures of themselves holding your products or talks about your brand online or offline, your brand gets instant exposure to a wide audience.

5. Secure Product Placements

Product placements are typically done in television shows, movies, and music videos, but think beyond those traditional placements. Fashion designers work relentlessly to get celebrities to wear their clothes during award shows and movie premieres. Brands from a wide variety of industries try to get their products into gift bags at celebrity events like the Oscars. You can go big and pursue some of those ideas or scale back and look for regional events where you could get a creative product placement. It’s also a great idea to look for local events that attract attendees who are similar to your target customer audience.

Get Help, Get Approval and Get Sales (But Be Flexible)

The key to launching a successful advertising and marketing campaign for a marijuana business in California requires following these four steps:

1. Get help from marketing professionals who understand marijuana advertising and marketing.
2. Get approval from an attorney who understands marijuana advertising and marketing laws in California if you’re worried about citations, fines, and other penalties.
3. Get sales by being relentless in your efforts and consistent in your messages.
4. Be flexible enough to change your marketing strategies and tactics in order to keep up with changing laws and interpretations of regulations.

Do you have any creative marketing ideas for marijuana businesses in California? Share them in the comments below.

Originally published 1/10/18. Updated 5/25/18.