Published on March 29th, 2019 | by Steve Nicklin0
Sales Tip: Cannabis Advertising and OOH
The cannabis category has increased OOH spend by at least double digits each of the past few years, according to Kantar Media. As the demand for cannabis advertising continues to grow, it’s important to understand the landscape, so this week OAAA presented a member webinar reviewing the cannabis category and its current state.
The webinar deck, along with a recording of the presentation, is available on the OAAA website. The content covers the opportunity, and some of the challenges, the category presents along with a review of how other vice advertising, like alcohol, self-regulates. The cannabis industry, however, is not yet at a point of self-regulation.
Currently, many competitive media channels shy away from the category, such as broadcasters with federal licenses. Cannabis remains illegal on the federal level. The expectation is that TV and radio won’t be airing ads for cannabis in the near future, as the Federal Communications Commission and Department of Justice are unlikely to give permission for such ads to air. Given this competitive situation, OOH media is viewed as both relevant and attractive by cannabis advertisers.
Cannabis is, and will remain, a political debate, and passionate voices from both sides will use OOH. As legalization expands, the expectation should be for increased criticism of cannabis. It’s a complex issue not easily resolved. For instance, Colorado has generated almost $1 billion in cannabis-related tax revenue since 2014 and now outpaces the annual tax revenue for alcohol in the state.
It’s important to consider how to promote the associated brands, products, and locations of cannabis advertisers. The key issues are the same as those for alcohol: placement (where should the ads be located); and content (what is acceptable).
The reason the alcohol industry self-regulates is because they find it to be good policy and good business. The Distilled Spirits Council, the Wine Institute, and the Beer Institute all have specific, published rules set-up as voluntary guidelines. The rules are periodically updated to keep pace with change (such as online ads), include a mechanism to review complaints, and offer transparency in outcomes.
Common self-imposed rules for alcohol advertising include:
- Ads meant for adults, not kids
- 500-foot buffer (same as OAAA Code)
- Models must be 25 or older
- No excess
- No encouragement of impairment
- Alcohol is not tied to achievement or professional/athletic success
- No lewd exploitation
In summary, OOH can expect increasing demand for cannabis advertising, but don’t look to their industry to set or enforce standards in the near future. The cannabis industry is still too young and too fractured to accomplish self-regulation now. Ultimately, cannabis self-regulation could mirror the existing framework for self-regulation of alcohol.
In the meantime, OOH media companies are the judge of community standards, and they also define excess. Eaze, the cannabis delivery company featured in the OOH ad above, will be one of the participants in the Direct to Consumer panel at the OAAA\Geopath OOH Media Conference + Expo May 20 – 22 in Las Vegas.