It's a Bumpy Road to Advertising for Legal Marijuana, but Fortunes Will Be Made

Once the Obstacles Are Gone, Our Industry Faces a Potential Goldmine

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About two years ago, I was cutting through the lobby at Traction and saw our receptionist talking to a guy who had just walked in off the street. It seemed as if she didn't know what to do with him. "Can I help you?" I asked him.

"I'm looking for an ad agency," he said and handed me a business card that said Grassroots Cannabis. "I run the largest medical marijuana dispensary in San Francisco."

Of course, the first thing out of my mouth was, "Look buddy, we're not cheap. You got any money?" He threw out a six-figure number and, sensing a great creative opportunity, I said, "Alright, let's talk."

A few days later I was visiting this drug entrepreneur at his place of business. It was like stepping into Amsterdam. The place looked like the coziest of pubs with a weathered oak bar, three good-looking hipster "bud-tenders," and a crowd lined up 12 deep for their turn to buy their medicine. Rows of glass jars were filled with fuzzy green bud. An elegantly printed menu on the bar described the 75 varieties of marijuana available for purchase. "We've got the best selection in town," my host proudly said.

He introduced me to the on-premise baker, who was concocting all kinds of THC-infused delectables. "No patient leaves here empty-handed," he told me. "Even if they're flat broke, we still will give them a pot cookie for free. We take our mission to help these people seriously." Not a line you'd expect from your ordinary neighborhood drug dealer.

He showed me the machine he invented to manufacture hash oil. He discussed the permit process and how city regulators loved him because of his disciplined approach to record keeping. He talked about establishing an off-premise grow room so he could "verticalize" his operation and offer the best product at the best price. Then he told me this was all incredibly important because he was selling more than a product; he was selling an experience.

Here was a serious businessman. In the months before, I had seen Howard Schultz from Starbucks and Tony Hseigh from Zappos speak at conferences, each on a different continent. I was struck that the way they described their companies was almost identical. Starbucks wasn't in the coffee business. They were in the customer-experience business. Zappos wasn't in the shoe business. They were in the customer-experience business. It was as if they both had hired the same speech writer. And here was the CEO of Grassroots Cannabis, speaking as if he were reading from the same script.

As Ad Age pointed out recently, new pot advertising has been slow out of the gate in Colorado even as recreational marijuana use has become legal. This isn't surprising. There are all kinds of challenges to consider. While two states have called declared recreational marijuana legal -- Washington state is the other -- the U.S. government has not.

Ultimately, the bumpy road to execution kept Grassroots from pulling the trigger on a campaign. A federal prosecutor sent out a note that public advertising would not be tolerated, and my psuedo-pharmacist friend is extremely careful to be absolutely compliant with regulations. He's not about to spoil a great thing.

We also discussed creating an e-commerce delivery service -- like GrubHub, but for pot. It would have been brilliant, except no credit card companies will accept payment for marijuana.

These challenges are real and will prolong the amount of time it will take before we may see great campaigns in the cannabis industry. Yet, this is exciting for our industry. Outside of Cupertino, how often does an entire (inevitably) multi-billion industry just emerge out of thin air?

It's not just the weed. There's an entire "smokeables" industry emerging -- and it's going to be huge. Dispensaries. Rolling papers. "Vapes" or e-cigarettes. These are all canvases for brands to emerge. With smart business leaders like my friend from Grassroots in the picture, it's a given that they will. The smokeables industry is coming. Brands will be born. Fortunes will be made. Stories will be told. Personally, I can't wait to tell them.

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