April 17th marked exactly six months since Canada became the second country in the world to legalize recreational cannabis. In many ways it represents an important litmus test, with the rollout having far-reaching implications for how cannabis might be sold and marketed in other countries.

In a brand new category with national reach, it was a given that marketing would be crucial in creating consumer awareness and brand differentiation. But licensed producers (LPs) also knew the rules set out by Ottawa would be extraordinarily restrictive. Exactly how they would be permitted to build their brands was very much an open question.

As expected, cannabis marketing has been relatively subdued because of the strict regulations, although the first six months has produced some signposts for what we might see from the category.

There have been smart tactical executions, such as Up Cannabis’ clever out-of-home misdirect campaign that appeared like bank advertising, to Tweed’s collaboration with Mothers Against Drunk Driving and Uber that positioned it as a responsible brand right from the get-go.

There’s been a heavy emphasis on PR and earned media, with tactics that might violate the spirit of the Cannabis Act, yet still fall within what is permitted—such as B.C.-based Invictus-MD Partners’ association with KISS frontman Gene Simmons as its chief evangelist.

Some brands are on the hunt for legal loopholes, preferring to beg for forgiveness rather than ask for permission. The government has been pretty lenient to this point, but our experts predict Health Canada will become more aggressive in clamping down on violations.

In this first of a two-part look at cannabis in Canada at the six-month mark, our experts share their observations about how far the market has come, how much (or how little) the regulators are weighing in, and where we go from here.

Brand building: A work in progress

Colin Turnbull, chief strategist at Brand Community agency LeFace, says some research shows that less than 11% of cannabis consumers can recognize or name the brands they have purchased from. He attributes that to packaging restrictions and a lack of “informed” cannabis marketing and education.

With consumers largely undecided on brand preferences, Colin says it’s still “anyone’s game” for the leading LPs. “Brands focused on developing deep meaningful relationships with their customers based on shared values will win,” says Colin. “They always do.”

The Cannabis Act: Lots of uncertainty

“I’m continually surprised by how many brands are running well outside the regulations, with little repercussion,” adds Colin. “While Health Canada has issued a number of warnings we haven’t heard of any significant fines as of yet.”

One big surprise has been Health Canada’s reluctance to disclose to LPs if what they’re doing complies with the Cannabis Act, only indicating the risk level associated with such activity, says King. It’s a good reminder that we’re still dealing with a new industry and the rules are still being made up as we go.

Health Canada favours a birth date entry over the simple “Yes I’m 19+” when it comes to accessing cannabis websites, even sending warning letters to companies that have used the latter. Yet, everyone knows that it’s easy to provide a fake birth date with zero restrictions.

It is just as easy to pick an arbitrary year as it is to confirm you’re of legal age, so condemning one over the other seems a waste. 

While the Cannabis Act requires brands to take “reasonable steps” to ensure those who are under-age can’t gain access to cannabis content, Grossman says those steps appear to have been interpreted differently across the industry.

Future strategies

Marco Ciarlariello, intellectual property lawyer at Cassels Brock, says that cannabis marketers are placing a greater emphasis on business-to-business marketing, noting that it is largely exempt from the “significant restrictions” placed on direct-to-consumer marketing.

In our view cannabis isn’t special when it comes to marketing. It is a regulated CPG, albeit highly regulated compared to any other, marketers will continue to rely on tried and true tactics that are Cannabis Act compliant like direct mail, data informed email marketing and segmentation, voice and geo-targeting.”