As Canadian companies rush to cash in on the impending cannabis legalization, they’re running into a major hurdle: they can’t advertise their products.
In a sharp departure from decades of flashy, vibrant campaigns for tobacco and alcohol, federal regulators have opted to come down hard on the cannabis market, forcing utilitarian and subdued packaging with heavy restrictions on advertising.
The result is companies getting as creative as possible – and trying not to break the law in the process.
With conventional advertising largely prohibited, social media is quickly becoming a new frontier for companies to test messaging. Tweed, the main subsidiary of multibillion-dollar Canopy Growth, scatters its social media profiles with posts in a not-so-subtle indicator of its product.
MedReleaf, a medical cannabis company, has released a “cannabis inspired” beer, with 4.20% alcohol content – but no cannabis. “You have to be creative in what promotions you do,” says Luvlina Sanghera, head of Jekyll+Hyde, a Toronto-based marketing firm advising cannabis companies. With all of its restrictions, she likens the current state of the industry to the prohibition era.
Health Canada has strict proposed advertising rules: companies can’t promote people or events, celebrity endorsements have been ruled and, most critically, promotions of “glamour, recreation, risk, excitement or daring behaviours or a positive or negative emotion” are prohibited. Instead, by hosting concerts and gallery shows and showcasing early iterations of future products – and ensuring those products don’t contain cannabis – companies are able to sidestep advertising restrictions.
Some products raise questions about how much companies are adhering to the spirit of the proposed regulations. Health Canada told the Guardian that after the legalization of cannabis, the current iteration of the Cannabis Crunch box would likely be in violation of the law. Companies have reason to be wary of running afoul of advertising rules: violations can carry penalties of $250,000 to $5m – and between six months to three years in jail.
San Rafael skater
By launching its beer, MedReleaf wants to evoke a nostalgia for California cannabis culture. But while companies bet on cannabis-flavoured products to build a future customer base, others remain deeply skeptical. “The purists out there won’t buy it. The market’s way smarter than that,” says Robin Ellins, owner of Friendly Stranger, one of Toronto’s oldest cannabis culture shops.
Funded by a multibillion-dollar cannabis company, Tokyo Smoke has gone to great lengths in using a small red oval on black to identity its brand – an aesthetic similar to what mock-ups of government-approved marijuana packing might look like. But even social media pages laden with allusions have limits: on their various platforms, there are no images of cannabis plants or people smoking.
Royal Canadian Cannabis is hoping to use augmented reality, where digital overlays are projected on to a smartphone screen, to help amplify the nondescript government packaging with pop-up information and animations. “On its face, it’s abiding by the regulations, but when you look at it through a smartphone, this kind of changes it. Does that still comply? It’s a very interesting space,” says lawyer Amanda Branch.
With broadly interpreted rules, companies see the incentive in pushing up against the limits as a delicate balancing act. “There are benefits to getting your ads out there and getting your name known for when cannabis becomes legal,” says Branch. “But at the same time, you want to strictly comply; you don’t want to be the person who Health Canada is making an example of.”
Full story is available here.