(This story appears in the February issue of Marijuana Business Magazine.)
It’s every cannabis executive’s dream: a line that stretches out the door and down the block, full of customers eager to spend money on a new product. Social-media hype. Word-of-mouth buzz. And a cash register that’s about to start smoking from all the transactions.
In order to generate that amount of interest, marijuana brands increasingly are employing the strategy of product drops. Cannabis companies can use drops to advertise new products, build excitement for the company’s brand, conduct market research and grow a following.
The marketing technique is common in other industries, where it is used to sell sneakers, video games and music.
An established brand often will collaborate with a well-known name from another sector—say, a clothing company with a famous street artist—and release a limited quantity of products for a short period of time.
“Get it before it sells out” can be an effective motivator to entice consumers, marketing experts told Marijuana Business Magazine.
“We work pretty diligently to keep the brands hyped up so that when we get a new product, it’s pretty well received,” said Alison Miller, director of sales and marketing for Hana Meds, a vertically integrated cannabis company based in Tempe, Arizona.
Brand collaboration drives the product-drop ethos of Space Coyote, an infused pre-roll brand based in the San Francisco Bay Area.
CEO Libby Cooper said Space Coyote has successfully collaborated with concentrate companies and boutique flower growers. The collaboration element is important, she said, because it allows a brand to tap into a different demographic.
Cooper pointed to a collaboration with Los Angeles-based “daytime disco” band Poolside as a partnership that went particularly well.
Space Coyote produced a five-pack of hash-infused joints, sourced custom artwork on the packaging, then “leaked” the pre-rolls to a few of the company’s favorite dispensaries. The joints came with suggestions about which Poolside songs to listen to while smoking.
“Bonus points if your feet are in a body of water,” the marketing materials read. “This is an incredibly limited run, so once these Daytime Disco packs sell out, you won’t be able to find these collectible tins again!”
According to Cooper, the hype around the launch and the limited-release strategy worked to build the kind of buzz Space Coyote wanted.
“We had created hype around this product—and when it was released, it was snatched up,” she added.
During the coronavirus pandemic, Cooper said sales representatives for Space Coyote have favored using text messages and phone calls rather than in-person dispensary visits to create word-of-mouth interest.
She also has found that Facebook Live videos work to the tune of 200,000 views or more—but not all of the viewers are in California, so it’s not as targeted as in-person interaction.
While generating hype around new product launches is the obvious goal for marketing teams, at Snowflake, Arizona-based Copperstate Farms, the approach is one of prudence.
Allie Marconi, the company’s director of marketing, said she’s careful not to give people false excitement in case the brand doesn’t come through, which can happen with fickle products such as flower.
“If we send out a message that says we’ll have an 11 a.m. drop, and we aren’t able to get our hands on that flower, we’ll have some pretty angry patients,” she added.
Marconi said she uses text messaging and daily emails to get the word out and try to create a sense of “come and get it while it’s hot.”
Copperstate uses dispensary marketing platform Springbig Holdings for text messaging. Marconi said the platform helps to target the company’s messaging by gathering consumer data about buying preferences.
Instagram and Facebook also are valuable tools for spreading the word about a new product, Marconi said. But more than anything, she emphasized the benefits of working with a company that has similar values.
The cross-promotion is that much better “if you’re working with a product that you agree with,” she added. Copperstate has partnered with DNA Genetics and Moxie Concentrates.
Success with texts
For Lisa Gee, director of marketing at Denver-based vertically integrated cannabis company Lightshade, text messaging is the No. 1 way to get the message out to customers about new-product drops.
Lightshade is reducing its reliance on social media, Gee said, because recently more of its posts have gotten flagged—even though the company hasn’t been doing anything differently.
“We’ve always been very mindful about not getting sideways with the rules on social media,” she said.
Gee said Lightshade tried product drops with outside flower brands, but those didn’t work out very well. Now, the company is trying to build interest for its in-house flower brands.
Lightshade plans to offer limited batches of three new, in-house strains at all nine of its stores in the Denver area. Similar to what Hana Meds is doing, Lightshade will decide whether to add the strains to its permanent roster depending on how well they perform during the product drop.
While Gee would like to see lines out the door, she recognizes that the coronavirus pandemic has pushed consumers more toward online ordering—and they’re using digital access more often.
Camille Roistacher, CEO of Los Angeles-based flower brand Wyllow, said she measures a product’s success by if and how quickly it sells out.
“If we’re launching a new strain, we’re watching the KPIs to see how quickly it moves,” she added. “If a product is sitting (on the shelf), that means a customer doesn’t like it.”
To build buzz, Roistacher likes the countdown approach. For example, Wyllow will use its Instagram page to announce that in four days a certain product will arrive at a specific store. She doesn’t advise posting about actual sales but instead recommends using Instagram Live or Instagram Reels to talk about a product launch.
Roistacher said Wyllow uses the drop strategy as it partners with different dispensaries to hype different products, build excitement and grow a following.
“We see every store as a mini-campaign,” she said.
Less hype, more vetting
Kevin Hogan, president and co-founder of Bend, Oregon-based Oregrown, takes a different approach to getting products in front of customers.
The company spends up to a year working on product development before it releases a new product, so Hogan said Oregrown doesn’t need to test out items with product drops.
“All the hard work is on the R&D side,” Hogan said. “We’re not in the artificial hype business.”
Oregrown relies on news releases and a loyal customer base to build buzz about new items, but the company isn’t necessarily trying to get people lined up out the door.
“When we release a product, we fully anticipate it will be a part of our long-term roster,” he added. “We make sure everything’s vetted.”
Hogan said the company tries to manufacture enough of every product so there is enough for all its customers.
“At the end of the day, it’s telling our story, it’s not modeling ourselves off of Air Jordan,” he said.
Like Marconi, Hana Meds’ Miller uses Instagram and Facebook to get the word out. She’s also found that Twitter can be a little more lenient when it comes to what can be posted.
However, she advises caution when posting on social media. Advertising a sale or promotion is a good way to get an account shut down. “You have to make sure you’re abiding by each site’s rules,” Miller said.
Aside from the internet, Miller works with local media outlets such as newspapers and cannabis magazines for advertising.
Another benefit that drops create for the company: research and development.
Miller said the company doesn’t produce enough of its new products to release them statewide.
“If we have a specific product that takes off during one of these launches, we can replicate the product again,” Miller said. “It’s definitely a great way to test out products, and we’ll consider them part of the permanent line if they fly off the shelves.”