Editor’s note: Sarah Browne is managing director of consumer insights firm Gateway Radar, Oakland, Calif.
Election 2016 was one for the history books – and not just because of the presidential race. On that Tuesday, the booming cannabis industry scored a landslide victory, with four states legalizing recreational marijuana and another three states approving medical use. Nearly 80 years after prohibition, cannabis is emerging from the black market and speeding into the mainstream. Nearly 60 percent of the U.S. population now lives in states that have legalized some form of marijuana use and sales (Figure 1).
Then there’s the walloping financial windfall. Marijuana Business Daily projects the new legalizations could lead to $7 billion to $8 billion in additional annual retail cannabis sales, especially now that the world’s sixth largest economy, the state of California, has fully jumped on board.
If the numbers above haven’t convinced you that the cannabis revolution is worth a look, these stats might. Attendance at the 2015 Marijuana Business Conference, the big kahuna of cannabis conferences, hovered around 5,000. In 2016 the conference attendance more than doubled, as 10,841 of the cannabis-curious packed the sessions, the expo hall and networking events. In the badge line, late registrants were begging the crew for anything – a one-day pass, a ticket to the investor’s breakfast or the expo. The man next to me offered to pay triple the entrance fee. But the conference at Las Vegas’ Rio Hotel and Convention space was sold-out. The overflow landed at a jam-packed Starbucks where the lines snaked down the hallway to the conference.
The last time I experienced that level of excitement was at the tech extravaganza of 1994: Comdex. The frenzy. The free-for-all. The thousands of newbies hoping to get in on the Internet action early enough to grab a seat at the table.
You know how that turned out. The tech industry was born, creating new jobs and new wealth, changing untold lives and rocking our culture.
Many of us were there at the start. We scrambled to learn new tools and tech up our skill sets. We overcame the skeptics who resisted the lure of the next geeky new thing. One former client, an executive at a global CPG company, maintained during a focus group briefing, “Women will never go on the information superhighway.” I’m not sure where he is today.
During that pivotal era, marketing researchers not only embraced technology, we aced technology. We reinvented research to support and strengthen product lines, innovations and an ever-increasing flow of new devices. In so doing, our field mightily contributed to the growth of our economy, delivered success to newly hatched startups and helped companies understand the newly fluid marketplace and consumer.
We need to do it again.
America’s marijuana industry
“Legalization of cannabis is one of greatest business opportunities of our time, and it’s still early enough to see huge growth,” says Troy Dayton, CEO of cannabis industry investment and research firm Arcview. An advocate since college, Dayton was named one of the seven most powerful people in America’s marijuana industry by Fortune magazine.
Legal cannabis sales in the U.S. jumped 17 percent, to $5.4 billion, in 2015 and are expected to grow by 25 percent this year to $6.7 billion, according to Arcview. By 2020 legal cannabis sales in the U.S. are projected to hit $21.8 billion.
The opportunities for marketing researchers are unparalleled. Fourteen million cannabis newbies will flood the marketplace in the next year. They’ll be clamoring to learn about the pipeline of new products, services and innovations. Which should make recruiting a heck of a lot easier for us.
What’s stopping you?
You know you’re curious. New product junkies (like me) can’t help but be drawn to the innovations and the stories behind them. Take PenSimple as an example – a new herb grinder that’s flying off the e-shelves which got its start on a 3-D printer inside the Cincinnati Public Library. Or Octavia Wellness’s pot parties for the elderly, an idea born out of a daughter’s quest to help her mother cope with Alzheimer’s. Or The Peak Beyond’s interactive smart table which delivers key product information inside dispensaries in the most gee-whiz of ways.
And yet ...
You’re not a stoner: You don’t own a bong. You’ve never tried Purple Urkle. You don’t celebrate April 20. Congratulations! Your talents qualify you to conduct marketing research for the cannabis revolution. At its core, marketing research is about uncovering and defining the zeitgeist. We are trained to do this like no other profession. The industry doesn’t need any more Tommy Chongs – it needs fresh perspective as it says goodbye to its stoner stigma. Today’s cannabis is not your college roommate’s one-size-fits-all weed. If you can conduct a survey for big pharma, you can do this. Without ever using the word doobie.
You’re concerned about legalities: Marijuana remains classified as a Schedule I drug. Despite the new state legalities, the plant continues to be outlawed by the federal government. While many of these issues seemed destined to be resolved sooner rather than later, the recent election may (or may not) put the kibosh on progress.
Marketing research, however, is considered an ancillary business. As researchers, our risk is reduced by the fact that we would not typically touch the plant.
First steps: Cannabis MRX 101
You need to learn a new industry. Like wine with its nose, terroir and tartaric acids, cannabis has its own unique vocabulary, cultivation processes and ingredients. Indica? Sativa? CBD? Terpenes? Vaping, dabbing, tinctures, edibles, flower? Budtenders, trimmers and growers? Your first step in gearing up for cannabis marketing research is immersion. Oaksterdam, Ask Willow and Green Flower Media are great sources of marijuana education. You can also subscribe to Marijuana Business Daily, which has been covering the industry since 2011.
Recruiting. Going public is often perceived as a risk. Many employers still require drug testing. Privacy concerns are rampant. Since election day, there’s confusion about what’s legal, what isn’t and when. Consumers wonder: Do we still need medical marijuana cards? What can we buy? What can we grow? Can we share and where?
This phenomenon is apt to increase as the new mandates are rolled out over the coming years. The inevitable result of these thorny issues is reluctance to being candid about cannabis use and behavior. This is particularly true for one traditionally sought-after respondent: moms. Horror stories still surface about children and parental usage. The result? The screeners and recruiting tools we typically design and use may not be as effective. The entire recruiting process may take longer and cost more if researchers rely on traditional techniques.
State by state. Implementing a study for a cannabis project can be challenging. For example, each legalizing state has its own products and policies. A product that’s a best seller in Colorado can’t be sold in California. The product can’t even legally leave Colorado’s borders. For example, if a research team conducted taste-testing on a Colorado edible, they could not legally fly to Oregon with that product and test that same edible there.
I came across this challenge with a Canadian client who wanted to test his product in California. We introduced him to a San Francisco-area contract manufacturer so that the California firm could produce a version of the Canadian product.
This unwieldy situation is changing; new mergers and licensing deals are already modifying these practices. But for now, for researchers to even test a new product in California, it must be produced in California.
As in the early days of tech, market researchers need to be scrappy, resourceful and ready to move beyond traditional research roles. We need to expand our toolkits, rearrange our minds to view the plant as medicine and rethink pot personas. To mainstream this vital crop, and ensure its benefits are available to more, the same old stoner myths and assumptions must be overturned.
Who’s in?