Few industries offer the kind of ground-floor opportunity that legal cannabis does right now. Ever since starting a cannabis company became legally possible, entrepreneurs have been racing to stake their claim and build competitive brands across medical and recreational markets alike.
The cannabis industry is a multi-billion dollar market that is growing every year. Not only is the industry recession proof, it only grew as profits soared throughout the COVID-19 pandemic.
Without a doubt, the hemp and marijuana industry pose fantastic opportunities to create a business that can last a lifetime while generating revenues that surpass countless other industries. If you are reading this, you are probably somewhere along the fence of beginning your cannabis venture.
Since you are here, we want to provide you an experienced guide to creating your own cannabis brand business model, and place yourself in a position where your business can compete with the big players.
15 Steps to Launching Your Own Cannabis Brand
As with any lucrative space, the internet fills up fast with people researching and launching businesses chasing the same opportunity. That competition can feel intimidating, but claiming your share of the market usually comes down to good timing and finding the specific niche you’re positioned to win.
1. Do Your Homework First
In any industry you want to invest in, you must conduct as must research as possible. Find out everything about who the major companies are in the space, as well as the history of your prospective industry.
In the cannabis industry, it is also important to understand the legalities at play. Knowing which states are legal and illegal for marijuana, as well as other cannabinoids like delta-8 THC, are important to know especially if you are looking to conduct your business in multiples states.
2. Define Who You’re Actually Selling To
Competing in the greater cannabis industry against household names may seem futile, but by considering which section of the industry you want to focus on, you can find foundational success.
Pinpointing exactly who you’re selling to is one of the most important steps in staying competitive. Your customers should function as a physical embodiment of your brand — they need to see themselves in what you’re building, which means your brand has to speak to them first.
Considering the demographic that your brand will serve is quintessential. Knowing your target audience, including their spending habits and consumer behavior will allow you to maximize your sales. Understanding and developing your audience’s profile is known as the customer segment, which is the primary group of people you want to sell your product or service to.
Within all the types of customers in the cannabis market, you must find a problem you can solve. Knowing which neighborhoods can benefit off of your dispensary, which shops need a wider variety of products for your distribution, and which towns are lacking cultivators are all potential problems you can provide a solution for in establishing your cannabis brand.
A handful of other variables matter too, especially if longevity is the goal. Your brand’s identity needs to line up with your customer’s identity, which means thinking through:
- Who are your customers and what are their needs?
- What do they do for a living?
- What age groups are you serving?
- What are their interests?
Work through these factors and solve a genuine problem for your target audience, and success will follow, as long as you can actually deliver your product to the customers you’re aiming for.
3. Pin Down What Sets Your Business Apart
Now that you have identified your customer segment, as well as understanding what their needs and problems are, you can now hone in on your primary product or service that will provide a solution to your targeted customers. The key product or service being provided is known as the value proposition, and is the main focus of your business to perpetuate sales and growth. This value proposition should be able to provide an advantage over other competing companies in the space, and allow you to build your brand’s identity as a result.
Say you notice younger adult customers in your area want affordable cannabis, but only premium-priced brands are available to them — that gap is your opening. Launching a budget-friendly dispensary aimed at those local buyers fills an unmet need directly. Because your edge is price, your brand identity can be built around reliability: the place people count on to get what they need without overpaying.
Having a cheaper price is just one part of what your value proposition can entail. Other factors, like having a better packaging method, higher quality service, or unique experience may be the icing on the cake that propels your value proposition from being replicated by any other business. You can have as many different types of products on your shelves as you’d like, but if you don’t know what your value proposition is for your intended customer segment, all of those products may be completely disconnected from your primary buyers’ wants and needs.
4. Make Consumer Education a Priority
Legal cannabis is still a young industry, which means a meaningful share of your customer base will be new to it. As with most things worth learning, there’s a bit of a curve, and it falls on cannabis businesses to help the public understand hemp and marijuana products well enough to have a good experience with them.
It is our responsibility to set examples for the future to rely on, especially in a space that faces legal scrutiny. Public awareness is vital to not only provide customers a chance of coming back to you, but also give them the confidence necessary to make sound decisions in their purchases. As people become more educated in cannabis products, they will be able to hold brands up to higher standards, which will further legitimize the industry.
5. Never Underestimate Packaging
Whether you are trying to produce your own cannabis, or distributing someone else’s, the product’s packaging is the most important part of the product. A company growing the best weed on the planet may never receive the attention it deserves among all the other cannabis brands unless they are presented in proper packaging.
Choosing packaging that genuinely represents your company is exciting, but it demands attention to detail. Any legal cannabis product needs to carry a specific set of information: THC potency from third-party lab tests, ingredients, warnings, weight, packaging date, and naturally, your company logo.
What needs to be included on the labeling also comes with a list of terminologies and images that cannot be used. Although subjective, all cannabis products cannot contain language or designs that may attract children’s attention. Additionally, any packaging containing cannabis may also require child proof seals.
6. Treat Social Media as Non-Negotiable
If you want to create a new business in any industry in today’s age, creating a social media presence for your brand is as important as registering your employee identification number. Once you finish selecting your packaging, it is now time to take product photos and develop a loaded archive of content waiting for you to post online. Make sure to start off your online marketing campaign swiftly and with as much content as possible. Fueling your social media platforms with posts as frequently as your competition is one of the best ways to launch your brand into your targeted audience’s attention. That being said, you may also want to look out for each platform’s terms and conditions to make sure you do not restrict your brand from reaching your customers.
Setting up social accounts can feel like a lot at first, but treat it as an opportunity rather than a chore. Once you’ve got a feel for the platform and a sense of what resonates with your customer segment, you can start shaping your brand’s narrative and telling its story.
Every great business has their own history behind it. With social media, the best companies of tomorrow start by telling their story online today.
7. Grow an Organic Instagram Following
Building off of the previous step, knowing how to best utilize platforms like Instagram may also help your brand receive a better chance of sticking out from the crowd. Instagram is mostly used by adults ranging from 21 to 40 years old, making it an ideal place for cannabis companies to reach their customers.
Whether you are an individual or business entity, creating an organic Instagram with a dedicated following is the best way to engage with your audience and convert them into sales.
Growing organically on Instagram, and most other platforms, comes down to staying consistent in four key areas.
- Create posts and stories as often as your competition.
- Upload your posts on a consistent schedule.
- Research the most trending hashtags that are relevant to your posts to increase your chances of being discovered by your audience.
- Create impactful videos that capture the attention of your customers and give them a call to action.
Lastly, it is important to note that social media platforms like Instagram also have great potential for developing your customer service. Regardless on where your company lies on the cannabis supply chain, it is important to have a responsive customer service in the direct messages of your audience.
8. Grow an Organic Facebook Following
Facebook is a great way to supplement the traffic onto your website or other social media pages if you are trying to target audiences over the age of 45. There are several ways you can utilize Facebook to drive your brand’s popularity.
Once your brand launches, customer reviews on Facebook can start building a reputation that lasts, provided your product and service actually deliver on what you promise. From there, you earn trust with first-time buyers and start turning them into repeat, loyal customers.
Facebook is also a great tool for generating traffic onto your website blog posts. If you have any content worth sharing on your website, you can post them on the platform to further the SEO optimization of your site. If you are including content that educates your audiences, you can create a means of further legitimizing your business to gain more customer loyalty and trust.
Like Instagram, you must be informed of Facebook’s terms and conditions when utilizing their platform. Make sure you comply to their rules to make sure your hard work isn’t taken down.
9. Put SEO to Work for Your Cannabis Brand
In a digital world where everything we can imagine can be found on a search bar, it is important to understand the significance behind search engine optimization (SEO). SEO is a practice that once mastered, can help you put any company to the first page of its search.
Understanding SEO starts with knowing that search engines rank pages using relevant keywords to connect searchers with what they’re looking for. To climb those search pages, your business needs to publish blog content around the topics that matter in your industry. The more keywords you use, and the more other sites use those same keywords, the more the search engine associates the two as relevant to one another.
Aside from creating your own posts on your website, you can also generate traffic by guest writing for other marijuana media outlets, and have a link going to your website at the end of the article. Additionally, you can have other websites talk about your company in their articles, which will further generate traffic to your website and boost your ranking on search pages.
10. Get Your Brand Featured on Industry Sites & Blogs
Regardless on if your business sells to customers or other businesses, increasing your online relevancy by having your brand linked to your targeted keywords is important to further traffic onto your website. With so many people on the internet, it is not a bad idea to promote your brand on another cannabis website, as you may never know who may come up to you and take your business even further.
Getting your business featured elsewhere online doesn’t just drive sales — it can lower your costs too. Building connections with other companies often leads to better sourcing for supplies and materials, which trims your operating expenses and boosts your margins in turn.
11. Add SMS Messaging to Your Marketing Mix
Sending a text message to your customers is a sure way of getting your customers’ attention. If you are already using other communication apps and email newsletters, consider getting your business into sending out text messages directly to your customers’ phones.
With over 75% of people checking their text messages within a few minutes, there is other way to effectively streamline marketing campaigns to your audience.
Since the Telephone Consumer Protection Act (TCPA), people can now choose to opt in or out of SMS marketing. It is important to remain within the law and work with SMS marketing services that best suit your needs and keep you within regulations. That being said, as long as are able to generate loyal customers, you will be able to retain their attention through SMS messaging.
12. Focus on Building a Real Community
If you have managed to build your online presence and create a brand identity that resonates with your customers, you are well on your way to building a community with your company. As you build an influence not only over your clients, but also your business partners, you can further your understanding of the greater market beyond your original targeted audience, and make greater business decisions for your company as you grow further.
Your network and customers are the foundation of your community. Creating a reliable brand that people can trust, while building meaningful business relationships with your suppliers, will solidify your position in the cannabis market.
13. Host Events That Bring Your Community Together
There is no better way to validate your newfound community by mobilizing an event. Whether you host a session at your dispensary, or begin an online challenge on social media for your cannabis products, generating an experience for your audience that goes beyond your product or service is a great way to further your customer loyalty.
This marks the point where your brand starts to outgrow its original value proposition. From here, you may be positioned to expand into new products and services altogether, as your company’s growing popularity opens the door to profiting from an even broader customer base than you started with.
14. Consider Bringing in a Cannabis Marketing Agency
Understandably, creating your own business in any industry is a ton of work, and making the appropriate marketing campaign to take it from point A to B may be just as much if not more work. That is why there are also cannabis marketing agencies that you can work with to help you propel your brand beyond what you may be able to do on your own.
Companies of all sizes consult marketing agencies to aid in their campaigns. Even if you decide to go with a specialized cannabis marketing firm, feel free to use these steps as a general guide to make sure your business efforts are going in the right direction.
15. Study the Industry’s Top 5 Cannabis Brands
Getting familiar with the leading brands in your space does two things: it shows you the playbook for reaching the top, and it highlights the gaps those leaders may have left behind for you to fill.
According to Business Decision Data Service Analytics (BDSA), here are the leading cannabis brands in 2021 sales volume in the United States:
- Rhythm:
Located in four states, and is the largest cannabis brand in Massachusetts and Green Thumb Industries, Rhythm has managed to generate over $430 million in sales, in which vapes accounted for half of their transactions.
- Cresco Cannabis:
Cresco is found in six states, and has taken in $425 million in sales over the past year.
- Stiiizy
Stiiizy is currently the fastest growing cannabis company with roots stemming from southern California. Now in four states, Stiiizy has generated $250 million in sales over the course of 2021.
- Select
In nine states across the country, Curaleaf subsidiary Select is one of the leading marijuana vape brands in the market with $235 million in sales.
- Wyld
Based out in Oregon, Wyld has become one of if not the leading cannabis edible company in the United States. Through edibles, Wyld has brought in $190 million from six states.
Hopefully this walkthrough leaves you feeling more confident about whether a cannabis venture makes sense for you. We’ve packed in as much practical guidance as we could to help launch a hemp or marijuana brand the right way. There’s always more nuance to cover, but these are the pieces that new brands most often overlook. Stay true to who you are, and your customers will notice.
