THE CANNABIS INDUSTRY (CALIFORNIA) SUCKS RIGHT NOW
2021 was brutal.
Every day is hard and a bit scary. I see a lot of people I love, care about and admire, struggling. Over 17 years in “commercial cannabis,” I have never seen anything like this. I hear farms are not planting, and $20 outdoor ounces are hitting the shelf. It’s not good for the farmer, distributor, or retail. We have a system where it is cheaper to give away your weed then destroy it. Basket is down and the entire supply chain is hurting, supported by insane inflation, and a global pandemic that does not go easy on the respiratory system, and makes us even less social and mobile.
Breathe.
The constant, “how do we improve sales right now” conversation is f’in brutal. We can’t change the flood so you can hang out in the highlands, take a beating and attempt to weather the storm or race to the bottom. I feel like maintaining sales is the new growth and all you can do is make it as easy as possible for sales reps and retailers to sell your products.
It blows my mind that some of the biggest brands in cannabis lack the most basic trade marketing tools. In my world, I only see one brand that nails it and they also happen to be one of the only flower brands showing growth in the Q4 quarter from hell.
Brand doesn’t matter. Till it does. I hear it over and over, price and THC is all “they” care about, but when everyone is leveling on price and THC, brand is the deciding factor.
Many have been riding scale and/or first-to-market advantage, did not foresee the 2021 flood, and for some reason assume that they do not have to play by traditional rules of CPG, supported by this warped, ego-driven perception that they have a brand, when at best, they have a logo on the box and a few pictures of some “young adults” smoking weed around a fire.
I digress.
What constitutes a brand? My bar is that people outside of the industry know your name. In my world that is Kiva and Wyld, was dosist, and maybe Cookies is crossing over in some groups of friends that follow streetwear closely. I hear a ton of buzz on super indie brand Delights but none of my mainstream-ish friends know Stizzy, Jungle Boys, Raw Garden, unless they smoke a bunch of weed. I am not denying that they are incredibly successful cannabis companies, and that they are very relevant in cannabis and they may transition to be the biggest mainstream cannabis brands in the world… just thinking about where the buzz is now amongst my thirty to forty something demo.
Who actually matters. I don’t know. Would you rather have mass “light users” casually purchasing cannabis once a month, or the “heavy user” demo purchasing cannabis every week, and when do consumers start recognizing brand?
I rarely know the name of the wine I drank last night unless the artwork is fire. I am familiar with Barefoot, Woodbridge, Coppola, 19 Crimes, but I would rather try something I don’t know vs what I do know. If it blew my mind I might take a picture of the label. I might know the label at Trader Joes, but I have zero idea who is producing it. That presents a problem. With that said, I am attracted to a label, or the Trader Joe’s wine guy, or waiter, who tells me what to buy. They are my budtender. Beer is a little different. I am not much of a beer drinker, but I generally have a six-pack in the refrigerator. Right now that is Modello. Last year, Stella. I was into Fat Tire for a bit. If anything, my buying decisions are based on some sort of conscious or unconscious lifestyle association. Hard alcohol is not my lane, and I will sheepishly try whatever is put in front of me but I have no allegiance to any brand.
It appears that flower is my wine, edibles are my beer, and concentrates are my liquor. I would love to have sub 10% flower that I could casually enjoy over a dinner with friends. I would like to smoke an entire joint, vs one hit and quit, so I can avoid becoming your socially awkward zombie friend. Back in the day, there was a killer event, pairing cannabis with drinks, phenomenal appetizers, and dinner, across a unique and diverse crowd, invite only, deep in the trenches of downtown Los Angeles. That was rad, forward thinking and super fun. Shout out THC Design.
My business partner loves Level, his girlfriend has a refrigerator full of Cann. He said the Lowell mixologist nailed it at HOF, combining booze and cannabis for a buzz he really dug. Where is my Red Bull and Vodka at?
In reality, I have not purchased cannabis for 17 years, and I spend most of my days looking at data. I am always at my best when I am in retail, talking to budtenders and experiencing consumers in the wild.
I’m bullish on beverage. Big alcohol is coming, that’s their lane, they will happily spend hundreds of millions of marketing dollars to educate the masses, they will be looking to acquire distributors that have the infrastructure that they need, and it will all happen fast.
The 215 cannabis and psychedelic “farmers markets” are interesting, seeing some non-reg “brands” drawing lines of 40-50 people. I see a number of my early 215 friends moving into psilio. Cultivation and brand building are quickly scaling and I assume that it is so much easier to do with no smell and mass power consumption to contend with. Cannadelic anyone?
Shout out Rose Los Angeles for being interesting, Jeeter for showing California cannabis how trade marketing works, Wunder for figuring out super tasty beverage, NABIS for bringing kick-ass technology to the scene, Fig Farms for holding down quality #indiecannabis, Glasshouse Group for somehow balancing mega-corporate values with great flower, bomb retail and kick ass creative, and HOF for bringing it all together.
IMO, 2022 will be a year of consolidation, California cannabis businesses shuttering, while new states are popping, limited brands going national, excited to see what happens across the cannabis DAO, NFT and Web3 landscape, let’s hope we see the movement on banking, thinking hash might go mainstream-ish, maybe growers start to trend towards celebrity chef, and I deeply hope we hit a terpene tipping point amongst buyers, budtenders and consumers alike.
These are our personal opinions and do not reflect the views or opinions of our employers… with that said we are riding anon, and have zero intention of revealing our identities anytime in the near future.
– cannabis4robots