How to Execute on a Cannabis Brand Marketing Campaign with a Retail Partner

{}Introduction

Host: All right, welcome everybody to the latest installment of the MediaJel podcast. I'm your host, today we'll be covering how to execute on a cannabis brand marketing campaign with a retail partner, and we're joined by Angela Pai, who is the former CMO of Papa & Barkley, CannaCraft, and many, many other companies in the cannabis space. Welcome, Angela, how are you?

Angela Pai: Good, how are you? Happy to be joining this holiday edition — this is like my little, you know, nug ornament that I had on my tree, but I brought it down to show everybody.

Host: Is there any special gift bags that you give your friends or family, since you're in the cannabis space?

Angela Pai: I think when you work in the cannabis space, we're always curious, and I go to three to four dispensaries every single week just to see how products are moving, have chats with bud tenders — those are always great opportunities to see what's happening merchandise-wise in the store, what people are shopping for, and what is the overall shopping experience. So the whole aspect of retail marketing, and being strong retail supporters, is very critical to being a successful brand in our space. And I think also, being in the space, there's never a lack of sampling that goes on, so it almost seems like my house is very abundant with cannabis products.

Host: Same here, same here, and everyone's always asking, oh, they treat me like a medical professional, like, "okay, I have this ailment for my elbow or my knees, what do you recommend," it's — I've become that resource for the entire family.

Angela Pai: Right, so for many ailments, people will come to you and say, "I just need a really good night's sleep."

Host: Yeah, it's a simple CBN edible, that's my go-to, I'll take five milligrams, and if I really need to sleep well, take ten.

Angela Pai's Path Into Cannabis

Host: But yeah, well, let's get into some marketing talk — you have tremendous experience in the marketing space, and you joined the cannabis space about three years back, maybe just start with a little bit about your background, and what brought you to the cannabis space.

Angela Pai: Sure, I come with over 20 years of global agency experience, working on classic, iconic brands like Heinz, Procter & Gamble, J&J, having launched Tide and Tylenol in different countries in Asia, and automotive brands like Mercedes, Ford, and then transitioning into beauty and fashion — so my last non-cannabis role was chief marketing officer at Halston.

Host: Wow, wow, you have a very diverse background. What makes cannabis so special, and what made you interested in getting into the space?

Angela Pai: Well, I grew up with traditional Chinese medicine, so the healing properties of plants — plants over pills — it's something I grew up with from a very young age. If you had an ailment, or you're just feeling a little bit under the weather, or any kind of allergies, there's probably some form of traditional Chinese medicine that's going to treat the root cause rather than the symptoms. So the TCM approach to physical ailments is that you're really treating the root cause of what's going on within your system that's not quite balanced, versus just treating symptoms of what you're experiencing on the outside. And I think with cannabis, and all the wonderful properties of the plant, really looking at the overall endocannabinoid system, in terms of rebalancing our overall circuitry, is something that's very important, and part of the science and education, as marketers, as we work with a whole lot of really great brands out there.

Host: Yeah, and I've done my research, I've hired a functional medicine doctor, and practice a lot of the warm tea in the morning, really setting yourself up for balance, start the day practicing a plant-based diet, and everything that comes with that, like acupuncture, and so on, so it's been really effective in my own personal health, as well as just managing stress, especially with COVID and everything — meditation, and all those practices, yoga that I do on the side, just to maintain balance. So well aware of everything you're speaking of, really passionate about it myself.

Identifying Retail Partners and Customer Segments

Host: Well, let's get into some of the marketing topics — how do you identify, when you're creating a campaign with a partner retailer, the differentiator that will connect with the retailer, with whom you can pitch the co-branding marketing campaign?

Angela Pai: Sure, I think it's important, from the brand's perspective, to be able to really understand what is the consumer mix and who are the customers of that store — not every store is the same, as we all know.

Host: Yeah, of course.

Angela Pai: But the dynamics of that store — is it more of a lifestyle-type store, is it a trendsetter-type store, what is the consumer and customer mix of that particular store, what are people going into that store looking for, is it a neighborhood store or a high-street-type store — really being able to pinpoint what their particular customer mix is, and then being able to plan, together with them, a program that's going to help them drive more traffic, develop more loyalty, bring some new customers in. So, depending on what the goals of that particular co-branded or co-partnered campaign are, really looking at their base and being able to create a relevant experience that's going to help them with their business.

Host: You mentioned customer segments — how would you identify that customer segment before even getting started?

Angela Pai: Well, a store buyer is going to know their customer pretty well, a bud tender is going to know their store pretty well, so a whole lot of planning needs to happen even before you execute on any type of campaign at the retail level, because it is about foot traffic, it's about understanding what is the mix of the conversions of people going into the store versus looking for delivery and pickup, and finding out what that proportion is. Some of the Bay Area-type dispensaries have a much higher curbside and delivery mix versus in-store, maybe some of the SoCal stores are more foot-traffic driven — then you can segment and augment a co-branded campaign in such a way where you're not just catering to people coming into the store, but also thinking about how consumers of that particular dispensary can take advantage and participate in the digital part as well.

Digital vs. Traditional Advertising Readiness

Host: And then, when speaking to different audiences, these customer segments, whether it's delivery or in-store, you're gonna have different calls to action, different goals, probably different promotions to encourage people to take action and go through that sales funnel — how receptive are retailers, from your experience, to launching a digital marketing campaign versus a traditional advertising campaign?

Angela Pai: It depends on the sophistication of that particular retailer. We knew that, from March of 2020, it really helped accelerate a lot of the digital marketing activities of all dispensaries, so that they could pivot into being an essential business where they could have delivery and curbside pickup, and so the velocity of digital marketing activities really started to take off around that time, just because it was necessary, and people couldn't leave their houses — so if you didn't have a proper online platform that was able to give a seamless experience into a conversion, you had to build that, pretty darn quickly. And then, second, really looking at who are the customers ordering products they know, and how do you develop something that is created to help consumers discover new products, and not just buy what's tried and true. A lot of that really depends — I mean, since you know, both at CannaCraft and Papa & Barkley, I have worked with MediaJel, and the amount of time it takes to actually activate a digital marketing campaign could take a long time, because some retailers don't understand Google AdWords, they don't understand tagging, they don't know what a destination URL is, so a lot of that, we, on the brand side, do have to handhold and teach a dispensary partner if they're not fully adapted into a digital marketing type platform.

Host: No, and yeah, it varies depending on the retailers, as you suggested — some of the more advanced MSOs, or just single retailers, have a pretty advanced technology stack in place, with everything they need as far as tracking, to ensure they can track their revenue and attribution for each campaign. So there's a lot of red tape really just to get set up, and it's really just on the onboarding and the campaign strategy, and just ensuring that the brand and the retailer are aligned — that's, I would say, 80% of the work in getting a campaign up and running.

Pixels, Attribution, and Compliance

Host: So, using the big word there, which is attribution — you know, why you need tracking pixels, when you're speaking to people within a dispensary who aren't necessarily conversant in these necessary steps.

Angela Pai: Well, what does it mean, if you're going to drop a pixel on my site, what does that mean, "I don't want you to track my stats," and, in that, which you don't know, it scares you — so going through the process of explaining why it's necessary, where it's not subversive in any way, and that you're not trying to track their traffic, we're really trying to make sure we're measuring ROI on any kind of investment towards digital marketing.

Host: Yeah, and that's really step one, right — foundation is ensuring that your pixel is installed, whatever e-commerce platform you're using, whether it's Jane, Dutchie, WooCommerce, Weedmaps, Sprout, the number of e-commerce companies is endless — ensuring you have that in place, so you can actually track a revenue number per campaign, and even per transaction. And when doing that, a company like ours, MediaJel, we don't track any PII, personally identifiable information — that's your phone number, email, and name, and any personal details, that's all captured through the e-commerce company. So, moving into regulation, since it's a highly regulated market, looking at how much of that device ID tracking you're really doing, and maybe you really have to walk away from that at some point, because it's not compliant.

Angela Pai: Yeah, and then, given the fact that we are in medical, there is HIPAA compliance that you have to consider, and that's something, at least on our side, that we follow all the protocols to be compliant with — and I know the e-commerce companies have had to jump through a lot of hurdles so that they are compliant, because they're storing your driver's license, passport, personal information, so they have to be really secure to be compliant, and it's really important that you have all that to ensure safety for yourself, protection for your own licenses, for your own brand, but also, more importantly, the customers.

Text Messaging Compliance and Opt-In Risk

Host: Right, about a year ago, as you probably know, the whole idea of being able to send consumers messages via text — it's not quite the same as your pharmacist at CVS sending you a text that your prescription is ready for pickup.

Angela Pai: You might think it's something similar, but it's definitely not, when it comes to dispensaries telling you, "oh, it's Wellness Wednesday, so it's time to come in and pick up some of your wellness tinctures or something."

Host: Yeah, and text messaging specifically is going through a lot of transition the last couple of years, with the phone carriers regulating a lot of the messages that go out through text messaging, and some of the CRM companies actually evolving and creating more of a chat technology where they don't leverage text messages in the same way. So just being aware of all of those restrictions, and ensuring that you have the opt-in messaging, where you require a customer to agree to your terms, to opt in to marketing messages, or else you could be hit with — I think it's a $15,000, $25,000 fine per text message that's sent out, and there are legal groups that are just going after dispensaries, trying to get some money out of them with some of these cases — so really protect yourself, ensure that you have proof and documentation of every time a customer opted into your CRM or your marketing messages, and follow that as a best practice for email and text messaging specifically, because there are fines that can be levied for sure.

Content Marketing and Bud Tender Education

Host: And since we're already diving straight into channel marketing, we're digital, let's get right into content — what's the role of content in content marketing, how do you leverage that to activate the brand, have you seen, working with so many brands, other examples that come to mind on the content marketing side?

Angela Pai: Yeah, I think the first step is creating that content strategy — a lot of the content created is video or photography, so ensuring that, number one, you invest in a great photo shoot, so that you have a lot of lifestyle pictures to support any of the content created, whether it's published through social media, a blog, or an ad campaign — that's kind of step one. And then, as far as activating the brand through the retailer, the blog has been really effective — creating custom blogs with product drops, aligned with maybe a YouTube overview, "this is the product, this is the background, this is the values of the company, here's kind of the test results," everything that supports the product information. And then bud tenders are on the front line, so any way you can educate bud tenders, they're the ones who are going to sing your praises in the store, having the conversations one-on-one with consumers, so bud tender education is huge. I know my friend Ryan Porter actually had a text messaging education system called Top Tender, and they would put bud tenders through a course where they educate them on all the brand specifics — depending on what region you're in, here's the place that was grown outdoors in Humboldt, and giving background on that and the company, the growers — bud tender education is really, really big, and if you really want to move volume you're not going to go anywhere unless you have that bud tender education. And then supporting that with an integrated marketing campaign — let's say you have, an example would be 30% off, and we can talk about this later and debate the incentives, but 30% off has been really a sweet spot for us in getting people to convert at a very high rate — high rate meaning like 10% or higher — that number specifically really encourages people to go through the full checkout process and actually buy something. So ensuring that you have your incentive, your messaging, all aligned, and then syndicating that across all platforms — that's going to be Google Ads, one channel, we use programmatic advertising as well, so it could be a combination of display ads, audio, and video streaming. A lot of companies aren't doing this yet, but if you do have the content, you can do a small, maybe 10 to 15-second video spot on connected TV, and then align that with your social media messaging as well. So the content will be different on each platform — social media can't promote the sale and use of cannabis, so we won't talk about incentives there, but we will send people to a landing page, an interstitial page, where we can talk about that a little bit more, but social media is kind of a double-edged sword — you can create organic content, but you really need to be aware of the limitations as far as ownership of your account, because it can go away, and we've seen a lot of accounts get taken down recently, some of my friends who run significant brands have had to go back and get their account back, get their main handles — so a lot of brands now have a backup IG handle that they support, so they're not completely losing touch with all of their followers and their community.

Protecting Your Brand Beyond Social Media

Host: Yeah, the best way to protect yourself on that is, number one, don't depend on social media as your only source, your only channel for getting new customers, but number two is just get all your technology in place, all your infrastructure, so that you can collect that customer information compliantly, and if your Instagram account is shut down, you still have all your customers' information — name, email, phone number, depending on which e-commerce company, all their purchasing habits — which can be found within an e-commerce or point-of-sale system. So really, really prioritize — my recommendation would be prioritize capturing and building your customer database, because probably about 20% of your customers are supporting 80% of your revenue, you have those regular customers, those locals, and depending on the region, if there's a lot of tourist traffic, maybe it's 10, 20% of your revenue, but you really need to nurture those relationships with your existing customers, because they're the reason you're probably still open, especially during COVID, there's been a lot of challenges in keeping doors open during the pandemic. So ensuring you're providing the best customer experience, investing in product sourcing, adding on your product catalog, listening to your customers, giving them what they want — that's all really important in nurturing those customers, and just be creative with it, if there's some vendor days or VIP product drops, or anything you can do to make your customers feel special, really take those steps, because we all know there's probably 10 other dispensaries within a 10-mile radius they can go to with a similar offering, so you have to hold them really close to your heart.

What Happens In-Store Matters Most

Angela Pai: I think what happens within the store is something that brands need to pay much more attention to. From a marketing standpoint, we're really looking at, okay, what's the velocity of our sell-in, and we know that through our customer orders, and then looking at how you're stacking up versus your competitors, and where you set up on your rankings, whether it's looking at BDSA or headset data, but nobody's really looking at what's happening in the store, what's going on at the store level. On the higher end, when we're looking at certain stores that have 75, 80% of their conversions coming through foot traffic, versus certain stores seeing as high as 40% of their traffic being digital, delivery, or curbside pickup, then looking at the most significant part of where your conversions are happening at the store level, who is the bud tender, who is contributing to what's being sold through, that concierge-type service, or guided-purchase opportunity — just a statistic of knowing that about 70% of consumers walking into that dispensary are undecided, so if 70% of them are open to trying something, or going to have an influenced purchase, then that bud tender interaction, and what's going on at the store, is really going to affect what they walk out of the store with. So those are things I actually consider to be very critical. Recently, while I have a little bit more time than usual, some of my friends over at Oasis Research and I had put together a number of focus group interviews, talking to experienced and non-experienced dispensary customers, asking them what are the most important things when you're going into the store, what do you look for, what's the hierarchy of needs, how do you decide on that purchase, what turns you off — all of these very typical marketing questions that most brands and companies are not asking, and really do need to hone in on, in order to continue to be successful, because, like you said, that 80/20 rule, keeping that 20% of your customer base who are very loyal to your brand, you want to make sure your brand is being activated and represented in a way that's consistent with your values at the retailer level — educating the retailer, educating the bud tender, requires a certain level of investment and dedication.

Host: Yeah, and you said "education" over and over again in this — education is key, from the top down, right, it all starts with management, prioritizing education with the bud tenders, with operations, and then, on the brand side, you have to do the same — if you want to see your product sold, you need to support bud tenders and really showcase your story, your values, your products, and be consistent with education. It's not something you can read a book about and move on, it's constant, every week.

Angela Pai: Absolutely, when you're looking at it, it's not one and done, you do it once and walk away, and anticipate the bud tender is going to be able to regurgitate — you want that person to actually experience your products and your brand. If you've got a new product launch, or a new brand launch, of course there's going to be some sort of immersion sharing new information about your products, what's been reformulated, why is it better, how does it stack up against the competitive set, and what's relevant in terms of helping the bud tender understand your brand and product, and who it's targeted to. And I think one of the things I hear a lot from buyers and dispensary owners is, "you don't have to give us all the swag, we're swimming in swag, but instead please invest in education, invest in teaching our people to sell, promote, or recommend your products" — what is the origin story, what is it about your products and brand — so that we are providing that level of input. And one of my favorite stats is that bud tender turnover, at a store, is six months, so if you've done your initial education or demo series for bud tenders, you need to go back at least a couple times a year to remind them, because their turnover is also affecting the amount of knowledge retained within that store over a period of time.

Host: Yeah, exactly, exactly, so there's a revolving door with bud tenders, unfortunately, like you said, six months, so prioritize education, make that a core part of your operations, and you'll reap the benefits, and it's a win-win for all parties.

Angela Pai: I definitely heard that with consumers walking into a dispensary, they want to be treated in a way that you remember who they are, you want to be a familiar face — you don't have to necessarily remember their names, it might be nice, but let's say if it's like a Sephora experience, where they know what you purchased, they know what you've been coming in for, and you're actually able to make suggestions — "if you purchased this particular brand of flower, or these types of pre-rolls, and you also bought some pain balm, here are some new items you might want to try, I've got a new strain of this particular brand that you really like" — imagine getting to a place where you get recommendations based on actual real knowledge of what that consumer is spending and what they've bought in the past.

Personalization at the Point of Sale

Host: Yeah, and all that information is easily accessible in the point-of-sale system, right, depending on which system you're using — I know Treez has this set up, where if I go into a dispensary in the Bay Area, they know me, they know my name, I wait for a second and they'll come get me from the check-in, they know what I've ordered, they know what I like — I like sativa flower and edibles — and they'll point me in the right direction, it just makes my experience that much better.

Angela Pai: It's the personalization, right, it's feeling special when you go into a store.

Host: Very much so, so if they're already walking around with their iPad, they know who you are, and can pull up your purchase history, they're going to have a much more relevant conversation with you as they're guiding you through your purchase intent for that particular visit.

Using Data to Find White Space: The Jam & Jane Story

Host: Exactly, and your marketing is innovation-focused — how do you leverage your experience with R&D and scientific affairs, to craft campaign goals and provide insights for iterating the next campaign, you gotta love data.

Angela Pai: Yeah, as a marketer, in any kind of space, you really have to be a real advocate for getting good, solid data, so you can actually make decisions — whether you're looking for that white space for a new product you want to bring to market. If you think about, whether it's a Jam & Jane from the middle of last year that we launched at CannaCraft, or the latest SKU from Care By Design, which is a one-to-one Max, with 2,000 milligrams of cannabinoids in a 15 ml tincture — you're really looking at the overall category, and saying, okay, what is the velocity of growth for each product form factor, whether different sizes of flower or pre-rolls, or different volumes of vapes, and looking into beverages, tinctures, soft gels, whatever — you're really looking at the charts of what's the velocity of growth, and where each of the top 12 players are sitting within the space, how are they priced, what is their actual SKU offering, what sizes and types of product — and then you go, "oh, this is moving really quickly, we don't really have a horse in that race, so let's look at developing something that's going to accelerate that." So, in the case of CannaCraft, it already had the number two and three beverage SKU brands within beverages — you've got HiFi Hops, you've got Keef, and it used to be number one and two before Cann really saw its velocity, driving that microdose beverage within that segment in the category. And we felt that, even though the beverage space still represents less than 2% of the overall industry, it's a way for driving and earning new customers into the cannabis industry, into the segment — you need to bring new users in. And the area of creating a brand for women, by women, was an opportunity we saw as real white space to develop for. So again, as a marketer, we start with who we're designing this for — we see an opportunity within the data of the market, we decide who we're designing for, and then go about creating a concept of a brand targeting women, and then look at what should the potency be, what should the flavor profile be, should it be an 8-ounce or 12-ounce, how are we going to price it, how are we going to drive the COGS, and which are the right retailers to actually launch with. So you're really seeing it through the entire arc, from opportunity, to supply chain, to your activation — looking at the right retailers, then content marketing, email marketing — we didn't do any text messaging for that one — but also event activations, so there are opportunities for people to actually try and experience the product in a compliant way. So the opportunity of looking through the entire arc, and having R&D and scientific affairs report in as part of that team, makes it, I think, makes it less risky, because you're eliminating a lot of the "oh no, we can't do that, what are you thinking" conversations. So, with the case of Jam & Jane, we started concepting it at the end of October of last year, and we already had the first products rolling off Space Station by the first week of May — so that's about six, seven months, in terms of how quickly we were able to bring a product to market, and you never want to miss certain seasonal windows, knowing that Memorial Day weekend is the kickoff of the beverage season, we absolutely had to nail that, to make sure we weren't waiting around until dry January.

Targeting Women and College-Age Consumers

Host: Exactly, and you mentioned the Lagunitas partner product, which is, I don't know what the demographics are on that, but I'm assuming male, and then you have the Jam & Jane, for-women-by-women products — how would you go about activating, reaching those customers, through digital marketing?

Angela Pai: Well, in terms of targeting a female purchaser, you might want to look at adjacent products, right, within the cannabis space, or adjacent products outside of the cannabis space — so we're talking about women who are cannabis consumers, who have walked into a dispensary or purchased from a dispensary in the last 90 days, they may have been an edibles customer, or a multi-pack pre-roll customer, then you start checking the box of who you really want to target, and then you create that geofence around your retailer, activate with the right type of programmatic campaign and beautiful content, and go for it.

Host: Exactly, exactly, and you're an advisory board member and professor at Loyola Marymount University School of Business — what insights do you have about consumers in the college market specifically?

Angela Pai: Well, they have to be over 21, so it's not like we can market to people who are underage, but second to that, there's a lot of interest in the cannabis industry — oftentimes when I'm going to holiday parties, there are kids, nieces, or cousins of people who, when they hear "oh my god, Ange, you're in the cannabis industry," ask, "how can I get an internship" — I'm like, well, I think cannabis is kind of like the new tech right now, so it's definitely of real interest for a lot of younger folks, and we do want that young talent, who are 21 and over, to be able to come into the space — Gen Z is definitely driving a lot of growth in flower and vape, and they're equally represented across all the form factors, so we do want that new consumer coming into the marketplace. But in terms of how you market to colleges, I don't think it's about where they are, it's who they are — again, you need to design for who your customer is, and look for ways in which you can have relevant conversations and incentivize them to go and do something — I consider marketing successful when we're able to change behavior, so what behavior do I want to create.

Host: That's a great point, and, when thinking about reaching these customers, I'll give an example — we have a campaign up in Michigan we're running, and we want to reach college students, so we're targeting 21-to-30-year-olds as the customer segment. Just a little background on programmatic — you do have access to audience, general information, so you can get demographics, income, age, sex, all that information is available within a programmatic platform, so you can filter that out — "I want to target women who are 21 to 30, who walk into University of Michigan, and have been to a cannabis dispensary in the last six months," you have access to that data to activate it. All the tools are available — I think, when you're creating the campaign, the filters you can add are pretty much endless, so it's really up to you, what boxes do you want to check, what are you looking for, and it does get a little more expensive when you start to add more filters, it's going to cost a little more on a CPM, which is cost per thousand impressions, but it's highly targeted, you're getting the audience you want. If you have five campaigns running at the same time, one targeting the beer drinkers, one targeting the flower users, one with the edibles, one lifestyle, one medical focus, you can create different content for all of those, with different landing pages, to target different audiences, and have them all running at the same time. So it's important to know what tools are available, and, given all the technology and evolution in the last 10 years, writing at the same time as cannabis, everything has changed because of this — mobile phones have really given us access to reach customers in new ways, and, as advertisers, given us the ability to only speak to the people we want to, which is what's really important.

Live Q&A: Outdoor Activations With Papa & Barkley

Host: For sure, I mean, if I think back to my early days working —

Angela Pai: Actually educated, I think, 3,000 senior living, active-aging community — we had a "Cannabis 101" education, and then, a week later, we would basically bus them into certain dispensaries within the Palm Springs area. I think, at the height of that particular desert activation, we bused a hundred consumers into one dispensary in one day — I think that was like three bus trips, and, obviously, this is pretty pre-pandemic, so it was something that needed to be stopped, but the velocity of growth in the desert area for Papa & Barkley, and the loyalty that was able to be garnered, with outdoor being one of the channels we had used, in terms of overall integrated marketing with in-store incentives as well — and even now, in the desert area, especially in the wellness realm, I don't think there's any other brand people love more than Papa & Barkley, because you're able to show a really well-executed integrated campaign that brings customers to a retailer with an education-first initiative.

Host: Yeah, and just to add to everything Angela said — billboards are top funnel, right, brand awareness, your new product, your new brand, people to know about you — programmatic advertising, billboards, they're all top funnel, and Google Ads, and Google and organic search, those are more bottom funnel — there's a lot in between that you need to do to support that, and that's the education, the activations that you did with the elder, baby boomer demographic — so it's all important channels to really support the end goal, and it's not going to be one channel that's the best, you really need to be activated across all of them. And then, getting back to that customer loyalty, knowing that active-aging community, or the boomers, they're gonna be super sticky if they find those wellness products that really help them have a really great active lifestyle, so if you're looking at lifetime value of a particular segment, and the loyalty that comes with it, when they find the products that work for them, that's really worth the investment as well — so, again, throwing acronyms out there, LTV, so important.

Standing Out With a Craft Brand Story

Host: And I think there's one more, from Kyle Gordon, about, "I need to stand out" — any tips you'd give in a crowded market, how can I stand out from other reps when trying to get a new craft cannabis brand carried by a retailer?

Angela Pai: I would say, go back to your origin story — what is it about your craft cannabis brand that really helps it stand out, is it the integrity of the grow, is it hand-trimmed, hand-finished, hand-packed — go back to the origin story, because it gives people, especially dispensary buyers and bud tenders, something to talk about. If you're talking about a craft brand, there's got to be a certain level of love and attention that goes into creating your brand, and that love and attention, with the right story, can really extend out to potential consumers — so, as a rep, have something different to say, that's going to really hit a chord, so that when somebody's recommending your brand, they're going to feel a lot more heart in it, because they say, "this is a brand that really understands how to do it." I think we see a lot of reps walking in with lanyards and cupcakes and whatnot, those are all really nice, but ultimately they can't bring that cupcake to the customer conversation, they're gonna have to tell a story.

Host: Yeah, exactly, exactly.

Avoiding the Race to the Bottom on Price

Host: Now, one final question, from Con — how do we, as an industry in California, deal with the race to the bottom when it comes to pricing, especially for flower, that's so hard — and, I know, Zeph, because he was part of the brand ambassador team, and one of our strongest educators that's ever been at Papa & Barkley, so I'm a huge fan of his.

Angela Pai: I think the sad part is there are a lot of brands who are really ready for that race to the bottom, but if you do have that differentiated origin story, and the integrity, and being able to hold the higher ground for why your product and your brand is worth its weight, I think you got to keep telling that story, and try not to participate in that race to the bottom, because, yeah, you're always going to have your value customer, but then you still have a lot of consumers who are going in and saying, "I want to stand behind the brands that are standing behind the community."

Host: Yeah, yeah, and it's a tough one — I've really had firsthand experience dealing with that in Washington state, just the last six, seven years, because everyone's selling the same product, there's no vertical integration, and there are ten stores in one city with a small population, so it's tough. And I know the ones that have been successful, from my experience, have had — the incentives are kind of tough, depending on which state, but always making a customer feel like they're winning on every experience, even if it's just the way you're pricing things — you can have a higher price, but on every order you're offering some type of incentive, or value-add, or a cheap pre-roll, a dollar pre-roll, just to add on to that sale, so they feel like they're walking away with something more than they anticipated. And another strategy is, any products that aren't selling through, they'll discount at a heavy rate, almost like a giveaway, just to get rid of that product and open up that shelf space, but just to make people feel like they're getting some incentive — it's a weekly deal, I know I had a heart up in Washington state, we practiced this religiously and were able to move about $800K in sales just from online orders, just from text messaging, email, and incentives, and that was it. But that was a store in Belltown, where you walked in, and it's a small store, but they're doing over $1.2 million a month in revenue in a small store — but it's all e-commerce sales, so, just providing that additional incentive, that was their model, sell more product at a lower margin, and that's how they capture their market share. However, if you think about the flip side — if we're able to push retailers to sell more products at a higher margin, and be able to pass it on equitably for brands and also for consumers, so they feel they're getting the right target, then we have a really great, growing market as well. But, you know, we're at 1201 now, a lot of the taxation conversation that's been going on around the state of California, where we really need to be supporting retailers and cultivators, so that the tax relief for all of us, in order for us to be a vibrant, legitimate part of the cannabis industry, is very critical — so sign your petitions, and fight for taxation reform for all of us.

Angela Pai: Agreed, agreed.

Closing Remarks

Host: And thank you, Angela, for taking the time today and sharing your insights, I know our audience has been really engaged and enjoyed the conversation — if you'd like to share a little about where they can find you, your social tags, email, company domain name.

Angela Pai: Sure, you can always find me on LinkedIn, I'm very active on LinkedIn, it's just Angela Pai, and also on Instagram it's just Angela Pai, and you can always find me, I always respond.

Host: Thank you again, Angela, have a wonderful week, happy holidays, and Merry Christmas and Happy New Year.

Angela Pai: Thank you, happy holidays, happy holidays.