Challenges of Marketing in Cannabis and What Works with CMO of Heavy Hitters
Our final on-location interview at SXSW Cannabusiness was with Hannah Davis, the CMO of Mammoth Distribution and Heavy Hitters. Hannah began her career marketing craft beer… before it was cool. She has taken her experience marketing to niche audiences into the cannabis industry and her unique approach has yielded some incredible marketing results for her brands. Here is her story.
How was your Experience at the SXSW Inaugural Cannabusiness Track?
It’s been a really cool place to have an intersection of technology, music, other new industries, and cannabis all coming together. I’ve not only met some awesome cannabis leaders but I’ve met some really cool people from those other industries as well. I think it was awesome that SXSW allowed us to come here and really talk about our business amongst all these other growing industries.
What Brought you to Cannabis from Beer? Are There Similarities in the Two Industries from a Marketing Perspective?
I was in the beer industry for about 10 years. I had an opportunity to do marketing for craft beer brands. As soon as I turned 21 it was definitely something that was becoming popular in the US. I was able to try a lot of craft beers throughout my key drinking years, I grew a passion for it, and ended up pursuing that passion into a career in marketing. I was able to learn a lot about how to market to niche audiences because at the time craft beer was still sort of niche ten years ago. It was also a lot of learning about how to grow small brands into national players. The cool thing about the industry was that it was changing every day so you could look a little far ahead but not too far ahead. I felt like it always kept me on my toes.
There were always challenges and everyone in the industry was learning at the same time which I thought was great. There was no one way of doing things. I had always thought, ‘would I ever want to market another product that has been around for a long time and hasn’t really innovated on itself?’ and I always thought, ‘No’. I like to be in product categories where things are always changing things are always moving and people are coming up with new ideas every day.
After that 10 year career, I wanted to see what else was out there. I still love beer personally, but craft beer was becoming democratized. It had lost a little bit of the sparkle that it used to have. I started looking to see what else was out there and got the opportunity to be on a cannabis research project for a company out in California. A couple of people graciously pulled me onto that project because of my general marketing knowledge and I fell in love. I got bitten by the bug and I said, ‘I want to do this’.
Honestly, there are a lot of similarities between the craft beer consumer and how they were interacting with beer and needed to be educated on it 10 years ago, and what’s happening in the cannabis industry now. I thought it would be an interesting place to take my skills and all the things that I’ve learned into an industry that is similar but also has a lot of unique differences in its own way.
What Are Some of the Biggest Challenges in Marketing Cannabis Brands?
I think one of them comes from the fact that there are so many new people coming into cannabis. In California recreational just changed over at the beginning of 2018. It’s been a lot of education, which is a fun place to be in marketing, but a lot of product categories don’t even have that challenge. You generally know when you’re buying a soda what it’s going to taste like and how you’re gonna feel like. But in cannabis, a lot of people really don’t know before they have that first experience what their reaction is going to be.
A big part of our job as both distributors and brand marketers is to teach people about the product before they even try it to make them feel comfortable with what they’re going to buy and make them feel comfortable with using it, especially if they’re gonna be at their home around their families. There are a lot of moms who use cannabis. There are a lot of dads that use cannabis and we want people to be safe and responsible as they’re using it and not be scared away. You never want people to have a “bad high” and then not ever want to try your product again. I think that education is a big part of it, which is both really cool but also just a challenge.
Then also the whole realm of cannabis being a schedule one drug. We can’t market it with many of the traditional marketing tactics that are used for a lot of other brands. Digitally we actually can’t buy ads on a traditional Google ad model or Facebook or Instagram. Pretty much everything that we’re doing in a social space is organic. If you’ve talked to other marketers, generally no product is organically marketed on social media anymore because Facebook wants their cash and the algorithms work that way now. So we have to get really creative in terms of what we’re showing and how we engage with people online to make sure that they are seeing what we’re putting out there because we can’t pay to have them see it. We can’t pay to put that message in their feed. So it has to organically show up.
How do you Get Things To Organically Come Up?
That comes a lot from recommendations. We do a lot of things where we’re encouraging people to interact with us, tag their friends to win prizes, tag their friends to make a joke or share a meme. And that’s the way we’re spreading our message boards. It’s a little guerrilla, but in a digital sense, and it’s forced us to be creative. I feel like it’s maybe a lot more fun that way because we can’t just buy an ad and put it out there.
What are Some of the Trends you Are Seeing in Cannabis Marketing?
I think there is a battleground at retail. That’s just my perspective coming from the beer world for so long. A lot of our marketing tactics were spent at the point of sale. So think about when you walk into your favorite grocery store and you see a display that’s set up for the football game. You’re going to be more likely to just pick up that case on your way in and out because you’re grabbing chips and beer and you just want to get it done fast. We learned a lot from that. Also with craft beer, we had to educate people at the point of shelf as well. What does this taste like? What sort of ingredients are in it? So we would have a lot of communication right there at the shelf and that’s what I’m trying to do in cannabis because I believe that a lot of people are walking into a dispensary and have no idea what they want to buy.
Many brands are taking the opportunity to educate consumers with little cards that talk about the strains and the flavor profiles and the effect profiles.On top of the actual physical pieces of communication, we also work on training the budtenders and making sure they understand what our product is. A lot of research has shown that the budtender is the gatekeeper for products. If a budtender recommends it you’re generally gonna buy it. Someone told me a stat, that 80% of budtender recommendations are taken by the consumer. So the budtender has a lot of power.
It’s similar to how much power a bartender has. Think about walking into a bar, you ask about the beers and the bartender says, ‘I love this IPA because it’s got a lot of great fruit and pine and I think it’s just amazing” and you’ll go, ‘yeah I’ll try it out, why not?’. So, I think you that education piece for the budtenders and then that retail communication is only becoming more important as a trend in marketing.
Influencer marketing has been a big thing for cannabis. But I think the trend will ultimately be to reach out to influencers outside of the cannabis world. There are a lot of cannabis influencers and they are awesome in their own right for reaching a certain audience. But I think they miss a lot of the mainstream audience. So for me what I’m looking for next is mainstream influencers who are going to reach those specific target audiences that I’m looking for.
What do Your Brands do to Maintain your Brand as Legitimate and Safe in the Market?
One of the main things that any California product would have to say now is that we’re tested and were safe. Our company tests at three points in the production process. The last being that third-party testing. But we also have in-house labs who are testing the safety and the efficacy of the product as it goes through the process. Number one is consumer safety. We don’t want anyone to ever have a bad experience with our product. So that’s really big for us.
Curious About Your Perspective as a Woman in the Industry?
The way I look at the gender parity issue in business in general is I just want it to be equal. When people say women dominated that makes me think, why should it be women dominating it? Why should it be male-dominated?. Shouldn’t it just be equal where you have smart people in a room together and you have a nice balanced blend of experiences and opinions and lifestyles? That goes from gender to race, background, ethnicity as well.
There’s been a lot of talk about that at SXSW during these cannabis panels. It’s nice to hear people bring it up in a forum like this and saying we need to be a more balanced diverse industry. Because unfortunately a lot of other industries out there got really big when in general business wasn’t very diverse. I think we have the opportunity as an industry to build it right and balanced from the start. So for me, I think it’s awesome to be a woman in the industry. And I will definitely support you know balanced fair teams moving forward.
Coming from the beer industry, it was frequent that I was the only woman in the room. I let my experience my actions and my skills speak for me and I was never afraid to share my opinion. I think a lot of that comes with being a millennial as well. I think a lot of millennials grew up in a fair and balanced and equal sort of footing with their male peers. I hope to show people that it’s possible to be a strong woman but also feminine in the business world and lay the path for the next generation.
Can you Give us Some Case Studies where Marketing Ideas Went Well for You?
We have a lot of different product brands but they’re all vape. Each brand target is sort of a different consumer. I call it portfolio segmentation, which any large CPG company would do. They would look at all the segments of consumers and have products for each one but make sure they don’t cannibalize each other.
When I look at the different brands I look at the consumers first and understand what is important to them in terms of not only their cannabis behavior and the occasions and the needs for which they use cannabis but also outside of that. What else are they doing? What kind of music are they listening to, what other things do they do in their lives? You have to look at the whole set of what that person is rather than just how do they use cannabis to market better to them.
When I think about our different brands, I’ll start with Heavy Hitters. Heavy Hitters is a stoner brand, it started in the gray market about seven years ago. HH grew up in the days where there were a lot of medical people but also this sort of gray market stoner culture was popular in southern California. But also it’s trying to be brought into the modern age. We don’t shy away from talking about getting high or high THC. We’re okay with that because that’s actually what we already know our consumer is looking for. They’re looking for an awesome high. They’re looking for high THC and they’re looking for it to taste really really good.
So a campaign that we ran at the end of last year the headline was, “Travel, Smoke Weed, Get Paid”. And it got picked up a lot of places. What we were trying to do is hire some brand ambassadors to go out and rep the brand but do it in their own niche communities. So we got a deejay. We’ve got a clothing designer. We have a girl who is a pole dance instructor. We got these people who are influential in their own small communities but also have something else to say besides I smoke cannabis.
When we were asking for the applications it just went viral. We got written up in High Times, Dope, you know a lot of places wrote about it because they were like oh ‘best job ever’. It played into that stoner culture, but it was also celebrating that people are unique and they’re original. When we talk about Heavy Hitters we talk about it as the ‘Original’ vape brand and it’s for original people. We want to be original, we want to be authentic, and we want to support other people who are also originals in their own right.
So that’s sort of where we’re headed with that brand in terms of supporting original people whether they be artists, you know tattoo artists, maybe they ride motorcycles, basically something else that makes them unique besides just being someone who uses cannabis. So I’d say that was a win.
How About Some of Your Other Brands?
We have this other product called Bae. It’s for the female recreational consumer who’s just coming onto the market, so call it your 21 to 35-year-old and it was formulated for someone who doesn’t want to “smell like weed”. We identified there’s this whole group of female consumers who didn’t want to roll a blunt or smoke a bowl because it’s dirty, it’s a lot of work, it makes your hand smell like weed, and then you smell like weed afterward and the woman we’re targeting doesn’t want to smell like that because she’d rather smell like her favorite fragrance.
So what we did with that brand is we really looked at the formulations as well as the packaging. The packaging could show up on a shelf in Sephora and fit right in. Then the formulations are things that aren’t scary to this consumer. What we want to do is give her a flavor profile that she could appreciate and sort of already understand in her mind before she even picked it up. So the tastes are pink punch, macaroon, and cake batter and we launched with those three taste profiles and it worked really well. Cake batter is definitely the number one.
We actually did a big Valentine’s Day campaign for it because we thought it would be a great gift to buy either your mom or your significant other for Valentine’s Day. You know sort of moving away from a box of chocolates to a beautiful vape pen that tastes like a box of chocolates. And so we did a gift pack where you got the vape pen and a bath bomb in a little makeup bag that was reusable. So that was a huge win for us and we pretty much tripled our distribution in two weeks leading up to Valentine’s Day which was amazing.
Can you Give us Your 1, 5, and 10 Year Cannabis Industry Predictions?
I’m gonna mostly talk about California for the one year because that’s as far as I can predict right now. I think by the end of this year in California we’re going to see a lot of the issues with the legal shops and the illicit nature of the market go away. It seems like the regulatory bodies as well as each of the county and city police departments are really making an effort now which is great. 2018 was a year of just a lot of questions everyone was getting their act together.
I feel like 2019 is the year of real organization, professionalism, and moving into that phase where we are a legal safe market for every consumer in California. So that’s my hope for the one year.
In five years federal legalization will happen. Or I hope so. If it doesn’t, there’s gonna be some interesting things happen with the cannabis industry. But I feel like we’ll have federal legalization and it’s going to become very normalized at that point because not only will you be able to walk into a dispensary but I feel like by that point there’ll be more ways to order it online and have a little bit more of that customized experience. Just like a lot of other product categories that are happening. Also at that five-year mark, I think – because I come from the alcohol industry – I think we’re gonna see a lot of complimentary usage with alcohol as well as replacement of alcohol. Not to even talk about the opioid issue. I think cannabis is definitely gonna help with the opioid issue in this country which is amazing. But I feel like there’s going to be a lot of switchover from alcohol to cannabis. I know I’ve already seen it in my own household. When I used to on a Friday evening grab a bottle of wine now I’m not doing that. I don’t even keep alcohol in my house anymore but I do have a little shelf in my fridge that has all my favorite edibles in it.
I’m sure in the news the alcohol industry is a little bit worried about that but I also see them making investments in Canada which means they see it and they see the opportunity that’s in the industry. Things like drinks are going to become more of the daily cannabis consumption ritual rather than just smoking. I think we’ll see a lot more formats.
Oh gosh, ten years is so far away for the cannabis industry. I think we’re going see global at that point and I think that’s the really exciting part of being a part of this industry. We’re not only making a U.S. industry from scratch but we are (the U.S. and Canada) leaders in the world right now. We collectively have the responsibility to make this a really cool industry and a responsible industry, but also one that’s going to change behaviors around the world. This is an amazing opportunity and an amazing responsibility but one that I think all of us are super excited about.
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