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Navigating Digital Advertising Regulations for CBD and Cannabis Industry

Navigating Digital Advertising Regulations for CBD and Cannabis Industry

Though we may want to put 2020 behind us, it’s worth taking a look at trends in an extremely untraditional year. 2020 saw stagnated growth for many industries, but it’s no surprise that the cannabis industry was, and continues to thrive. According to Leafly.com, American’s spent $18 Billion on cannabis in 2020, which was a 67% increase from 2019 figures. This “pandemic effect” leads to more insight. Many consumers discovered cannabis and CBD as a mental health tool, as well as a recreational and pain relief option. This opens the door in 2021 for different targeting than the industry has ever seen before. 

The past 5 years, cannabis companies almost exclusively targeted young men, according to Lisa Buffo, founder and CEO of Cannabis Marketing Association. Now, they have the ability, and frankly the need, to target new “cannabis - curious” consumers from baby boomers, stressed parents and anxiety riddled adults of all age groups with the message of safe, legal and helpful CBD and cannabis options. 

Though changes are on the horizon, compliance policies create a ton of obstacles with traditional media like print, tv and radio nearly impossible to utilize for this industry. This makes options limited, and targeting the best prospects more important than ever. Digital and programmatic advertising will be necessary for successful Cannabis companies to continue their accelerated growth.  

This means these brands need to adjust their strategy in 2021 and Orange142 is particularly suited to help navigate the highly regulated landscape of CBD, tobacco, vape and cannabis products from state to state. 

At Orange142 our Demand Side Platform (DSP) allows us access to premium inventory and the (DMP) Data Management Platform gives us the power of lead generation insight tool that makes it possible to digitally advertise to specific potential consumers most likely to convert to customers. Orange142 can expertly help navigate state to state regulations and increase web traffic, lead generation and sales. 2021 is the year for a bigger investment in CBD and Cannabis marketing. Make sure your dollars are being spent effectively and efficiently.

Cannabis marketing has seen a speedy shift to the digital realm to meet consumers where they are (i.e., at home) as a result of the pandemic.

Historically, digital advertising for cannabis products was hindered by platforms like Facebook and Google, which reject all cannabis ads regardless of the legality of the products in the jurisdictions in which the ads are served, and most marketers have accordingly relied on nondigital marketing tactics, or elected to advertise on platforms with the hope that they will not be caught.

With fewer consumers spending time in public spaces, however, the need for digital marketing and cannabis delivery services became starkly apparent this year. Cannabis businesses introduced features such as online ordering, curbside pickup and delivery, and started using programmatic advertising (e.g., display ads) to market to their consumers.

With programmatic advertising, cannabis businesses must balance regulations with business considerations such as geofencing, platforms, technologies, brand suitability and contextual relevance. Additionally, as noted above, brands must exercise caution when making claims about the health benefits of CBD.

With the continued legalization and decriminalization of marijuana in new states, cannabis-related advertising and marketing becomes an increasingly confusing patchwork of state laws.

This patchwork, coupled with cannabis companies acting like startups with little or no legal counsel, resulted in advertising claims and marketing activities that more seasoned industries would have known to avoid, such as making claims that their products treat serious health conditions.

In December 2020, the FTC announced the first law enforcement crackdown on deceptively marketed CBD products, taking action against six sellers making unsupported claims about the ability of their products to treat serious health conditions such as cancer and Alzheimer's disease.

When these companies, new to the litany of truth in advertising and related laws, engaged in various text message campaigns, the class action bar took notice, filing lawsuits against several companies for allegedly failing to obtain prior, express, written consent from consumers in accordance with the Telephone Consumer Protection Act.

Contact Orange142 today and allow our team to share more details on our advertising platform for CBD, cannabis and related products. With our premium, authentic, website inventory and our ability to navigate all of these regulations and restrictions in the marketplace we can help strategize a digital advertising and demand generation plan.

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