With the legalization of cannabis use in more states in the U.S. and other countries, more cannabis companies have been popping up left and right. The cannabis businesses in the U.S. are estimated to be between 20,000 and 28,000 as of 2017, per Statista. However, only a few are making it to the top of the game while many go up in smoke in a matter of time.
The legal cannabis market is a lucrative business, which is projected to grow like weeds to $24.1 billion by 2025 from the estimated value of $7.9 billion in 2017. Also in 2025, the medical and the recreational marijuana markets are expected to hit $13.9 billion and $10.9 billion, respectively, according to Entrepreneur. The report adds that Colorado and California are the best states to start a cannabis business.
To ensure long-term success in the cannabis space today, one of the main things to focus on is branding. Because there are social stigma and misconceptions about marijuana, related businesses are turning to sophisticated branding methods. Gone were the Rastafarian color of Bob Marley, the Jamaican flag and bad puns. From packaging designs to logos and even colors, the brand should be able to remove stereotypes and entice customers to change their perceptions of cannabis.
Cannabis companies today are employing more careful and professional considerations as to how they are going to bring their products to the market. A separate Entrepreneur article stated that the top priorities in creating a cannabis brand include a compelling story, a name capable of resonating with the target customers, a name that can be trademarked on a federal level, and a website and social media profiles, among others.
Moreover, advertising a cannabis-related business or product remains a huge challenge for the industry. Most online networks, broadcast and print media have imposed a ban on cannabis ads. Even in states where cannabis has been legalized, companies are restricted from buying billboard spaces and airing commercials.
The Moët Hennessy of cannabis
Toast Holdings Inc. is one company that is working on becoming the Moët Hennessy of the cannabis industry. Moët Hennessy is the wine and spirits division of the luxury brand LVMH. Toast focuses on cannabis in its natural form, offering pot cigarettes, called Slice, that contain high cannabidiol (CBD) and low tetrahydrocannabinol (THC).
Toast designed its Slice product to appeal to the consumers who are highly concerned about potency. It likens its product to a light beer or a cocktail, which ensures that the potency is predictable, perfect for a recreational environment.
“We wanted to put the consumer in control of their experience at all times,” Toast cofounder Chris Burggraeve told Forbes. “We created a simple-to-grasp equivalency between the strength of one ‘Slice of Toast’ and the strength of a drink. We removed the anxiety of extreme potency and introduced responsible enjoyment.”
Toast partner David Moritz added that they are aware of the negative connotations attached to marijuana, so they wanted to bring Toast in a different light. With that, they turned to luxury for inspiration.
They launched their product in Aspen, Colorado, where there’s an affluent audience and invited guests to experience Slice in a social environment. Toast was able to create a 95 percent awareness rate in the area. The success encouraged them to bring the product on the road, stopping next at Vail. Aside from Colorado, Toast also had a successful launch in California, and it is now poised for expansion and new innovative products.
CBD revolution leader
PotNetwork Holdings, Inc. (OTCMKTS:POTN) has been recognized as one of the leaders in the CBD revolution. The company has more than 15 recognizable brands, which are distributed by its wholly owned subsidiary, Diamond CBD. It has a wide range of cannabis products — edibles, vapes, creams, pets foods and supplements — that cater to different types of consumers.
One of PotNetwork Holdings’ addition to its collections is the Meds Biotech product line, which is designed for health-conscious consumers. Diamond CBD combined its pure CBD extract with turmeric and put them in capsules. The Meds Biotech products are pharmacist-formulated and packaged to meet the needs of the target audience.
Dr. Richard Goulding, PotNetwork Holdings CEO, said that with this product line, they are entering the health-focused distribution channels (e.g., vitamin shops, gyms, physician offices, etc.), which they expect to create more consumer awareness and brand preference.
Part of PotNetwork Holdings’ success in making its brands recognizable and preferred by the consumers is its aggressive marketing strategies. POTN and Diamond CBD made sure they are present in the biggest trade conferences, exhibits and expos. Just last month, Diamond CBD participated in the CHAMPS Atlantic City 2018, where it gave away 25,000 samples of its CBD-infused gummy bears to the attendees of the trade show.
Its participation in trade shows often translates to an increase in revenues. The company has been reporting record-breaking sales figures month after month. PotNetwork Holdings recently announced that Diamond CBD’s online sales for the month of May jumped by 639 percent to $669,000 compared to last year’s record. Because of its stellar financial performance, independent equity research firm See Thru Equity projected PotNetwork’s stock to reach $1.25 a piece this year.
Both Toast Holdings and PotNetwork Holdings are able to create brands consumers can trust. Aside from ensuring that they provide high-quality products, they continue to raise awareness among consumers, which will not only help them increase their profits but also contribute to the success of the cannabis industry.