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The new MJBiz Factbook estimates U.S. retail cannabis sales will reach as high as $52.6 billion by 2026.
That’s an astonishing sum, which would work out to $203 in cannabis spending per U.S. adult resident per year.
It’s an important number, one that’s worth thinking about – and perhaps retooling your pitch deck to specifically address.
Consider two equivalent parcels of land.
Imagine that two neighboring entrepreneurs decide to build identical cannabis grows next door to each other.
They use the same lighting, they draw from the same water source. They use the same equipment.
They both use nifty growth media. They feed the same micronutrients on the same schedule. They grow the same strains; they harvest at the same time.
Heck, they even wholesale to the same customers.
Now, as an industry participant, I have one question for you:
Which of these two grows is going to be the more successful?
That might seem like an impossible question. You might feel as though that’s a trick, that you don’t have enough information to answer. But you do.
FACT: Of the two hypothetical grows, the one with the better marketing plan will be more successful.
You can take that to the bank. It is universally true.
I learned the hard way.
My father left us kids some land. It’s run by professionals. The most insightful business advice I ever received came from a kind of sideways remark from an old farmer when I asked him the secret to success in agriculture.
“There ain’t any secrets,” he said. “None. We all farm in the same county. We use the same seeds, the same tractors and get the same weather. We use the same fertilizers and herbicides.”
Yet at the end of the year, after the crop is in – whether its Snoop-grade ganja or No. 1 corn – some operators are damn near broke and others are, well, not.
What’s the difference?
The way each farmer markets his or her products.
There are some tricks to successfully marketing grain, of course. That’s beyond the scope of our topic.
But the broader question that you need to able to answer if you want to be successful in business – or in seeking financing for it – is PRECISELY how your company is going to capture a disproportionately favorable share of the $218.18 that each American will spend on weed in only eight short years.
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Internalize your unique sales proposition
Cannabis is a commodity. The entourage effect is real, but at the molecular level, THC is THC.
What makes your product more desirable than anything else on the shelf with THC in it? Can you articulate it clearly, concisely and convincingly? Are you competing on price or quality?
Each element of your marketing plan should underscore the most compelling element of your unique sales proposition to the demographic you are targeting.
Every sale is an opportunity to create a lifetime customer. Precisely how are you making that the reality?
Every step of the sales experience should be maximized to its greatest effect, from the way your signage appeals to customers to the ease of finding the exit. It all works in concert.
Include the plan
Surprisingly, a lot of business plans often forget to include the actual plans.
They go to great lengths to describe the industry and the opportunity. They talk about a product and the team that will produce it. Maybe there’s a snazzy architectural rendering of something and graphs with enviable trendlines.
But where many business plans fall short, in my view, is in the granular details of the marketing plan.
This section should tell investors exactly how you are going to reach which customers and why they will choose your product over the competition. The more you can illuminate this area, the more likely you will be in finding investors – and in finding success after you do.
Measure the important stuff
Good marketing is based on monitoring and responding to key performance indicators.
Make sure you’re clear about what they are and how they will be tracked. Why are you trying to reach the market segment you are trying to message?
Sometimes we think investors want to see huge numbers. What they really want to see are accurate numbers and how they will be used to their highest and best advantage.
If your initial marketing efforts concentrate on 34-45-year-old married women with children, say how you are going to reach them.
The more detail you have and the more ways you can measure it, the more focused and effective your marketing can be.
After you act, react
No battle plan survives contact with the enemy.
If you aim to make 250,000 media impressions, say how you plan to achieve that and detail how you will convert these potential customers into buyers.
Think out your various contingencies and their possible outcomes.
Explain how you’re going to actively manage the results – and calibrate to ensure you’re prepared in case the results aren’t what you expect.
Plan to succeed, but don’t be afraid to engage your continency plans in light of your actual KPI results.
Make sure you have the best available information in your materials.
Andy Obermueller can be reached at firstname.lastname@example.org.