One Election That Might Affect Advertising More Than You'd Think

Who Will Be Marijuana's Ad Agency?

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Doug Melville
Doug Melville
You know what's sure to get a lot of attention this Nov. 2? California, the eighth-largest economy in the world, will have on the ballot a vote for Proposition 19 -- the proposition to legalize marijuana use for people over 21 years of age. Preliminary polls have the vote close, with 52% encouraging its passing. So while 36 seats of the 100 Senate seats will be up for grabs, as will all of the seats in the House, the legalization of marijuana in a state that produces almost $2 trillion toward the GDP will be front and center.

The legalization of marijuana comes down to death and taxes. Mexican drug cartels are making 60% of their money selling marijuana in the U.S., and 230 American cities have these cartels controlling the distribution. In other words, it's a robust black market. With $36 billion in annual sales, it is estimated that the legalization would bring in billions in tax revenue annually. It would also save money on prisons, immigration and enforcement. So while President Obama has gone on the record saying he "does not think that is the right plan for America," California Gov. Arnold Schwarzenegger explained to the WSJ the state's financial woes has them seeking new solutions generate money -- ways that don't include raising taxes. (And just last week, Schwarzenegger signed a bill making possession of an ounce or less an "infraction" rather than a misdemeanor. A $100 ticket will be issued.)

Today, medical marijuana is currently allowed in 14 states and D.C. Much of the current advertising is done online. Niche marketing firms have popped up to create SEO strategies to increase online awareness for weed stores, and a social-like network linking various online targeted websites. But independent print weeklies are also getting a substantial piece of the action.

If Prop 19 does indeed pass, mainstream use of the product will be allowed for anyone over 21 in the state of California. Which leads me to ask, "What firms will be tapped to market, promote, advertise and develop creative to help sell it? What changes will happen in the ad industry?"

In April, the U.S. Patent & Trademark Office briefly announced a new category under pharmaceuticals allowing people to trademark marijuana-associated names. Before the government had second thoughts and yanked the category, over 250 applications were filed to secure brand positioning in this new market -- iWeed, Weedtracker, Cannaflage to name a few.

This is only the beginning, as there will be a lot on the line, financially, publicly, and politically. With an estimated 15 million Americans currently using marijuana each month nationwide -- think what that might mean for California tourism.

But what will prevail? Moral and health issues or money? How will our industry be perceived? Will a major agency step up to market marijuana. After all, tobacco is legal, but it's not nearly the glamor account it once was.

(There are "fun" lighthearted questions, too. Will staff members too eager to work on the account be pulled aside by HR? Will the account team be expected to try the product or use it while coming up with creative? How would focus groups be conducted?)

Before long, different brands and niches will form in the market, accounting for more advertising budgets, more accounts up for grabs and more opportunities to grow your ad agency, bottom line and client base.

Agencies' existing client bases, such as hotels, bars, cities, beaches, restaurants, etc will all be affected too. Will agencies recommend such businesses dip their toes into the weed waters to attract more customers? How will social media come into play -- knowing that consumers can relay their brand experience up to the second? I can see brand managers reading a client tweet now "Just smoked a fat one at the Beverly Hilton! Headed to pool now with a roach. Come by!"

The space will likely be heavily regulated -- including the advertising (as it is with other guilty pleasures such as tobacco and alcohol). TV ads, print, outdoor and viral will all have to be examined to define the marketing and ad campaigns in this space.

Whatever the case, I look forward to Nov. 2 to see how this landmark vote unfolds. For marketers and advertisers, these high times should be a very creative period. I just hope people will actually remember it.

Douglas L. Melville is currently the president of Red Carpet Runway and a strategic adviser for various entertainment brands and personalities.
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