Have you started thinking about your marketing plan for 2024? Did you have a plan for 2023?
We’re still in the early stages yet, but as our industry matures more and more businesses are understanding the importance of planning – especially when it comes to marketing. That’s why we’re reminding our members about this important step, and why now is the right time to start developing a coherent and realistic plan for success in 2024. Have you started thinking about your marketing plan for 2024? Did you have a plan for 2023?
What does a good marketing plan contain?
Product and Service Overview – What does your company do, and what are the products and services you provide?
Your Market Position – What is/are the specific market segments you serve? Who are your partners? Who are your competitors, what are they doing? Have you done a SWOT analysis (strengths, weaknesses, opportunities, threats)? This is key information to develop an effective plan.
The Strategy – What is your value proposition? Why should a customer buy your product or service? How is your product or service sold? What are your key features and benefits? Who is your ideal customer? What is the pricing structure? How will that information be communicated to the market and what are your options? Who will sell it? Who will support it?
The Budget – What are the financial considerations involved? What budget is needed to do everything you want to do? Are those funds available? Does it make sense to have different budget levels so that you can adjust your plan based on market conditions? What are your short and long-term goals?
This is a basic structure, and these are just some of the factors to consider when formulating your marketing plan. As for Leafwire: we’re excited to be a part of your 2024 strategy. Let us know if you’d like to meet and discuss your strategy for 2024. If it involves digital marketing (and it should), Leafwire has a lot to offer to help make your 2024 a smashing success!
Mike Ballard Leafwire Media firstname.lastname@example.org www.LeafwireMedia.com
When you think of cannabis users, who do you think of?
Often our cultural image of pot smokers is quite polarized; our minds tend to wander towards hippies, rappers, and crowds of unruly teenagers. These groups are seen as degenerates by some and liberators by others, but most important, none of them truly exist. Much as there is no “average” American, there is no average “stoner”. These assumptions make it all too easy to look past reality: as cannabis consumption becomes more mainstream, it has become more bipartisan.
With the exception of those 75 and older, the majority of adults in the US are in agreement that Marijuana should be legalized for both medicinal and recreational use. According to the Pew Research Center, 72% of those who lean Democrat and 47% of those who lean Republican are in support of legalization. Remember, that’s just the people who are in support of full legalization.
When we account for people who feel that medical, but not recreational Marijuana should be legalized but not recreational use, the opinion of the American public is undeniable: only 5% of Democrats and 12% of Republicans feel that Marijuana should be illegal in all cases.
With such strong, bipartisan support in the polls, it’s impossible not to wonder, why isn’t more legislation being passed? Let’s take a look:
On April 4th the U.S. House of Representatives approved the Medical Marijuana Research Act. Currently, American researchers must get their data from Israel, the United Kingdom, Canada and other countries with more forward-thinking legislation.
This legislation would allow researchers to study cannabis from dispensaries instead of having to outsource information. Additionally, the bill makes it easier to apply and get approved to study cannabis by eliminating and simplifying many federal barriers.
The most interesting thing about the legislation? It was bipartisan.
Passing by a vote of 343 to 75, the bill was sponsored by Democrat Earl Blumenauer and Republican Andy Harris. What is most interesting about this duo – and the bipartisan coalition surrounding cannabis – is that even when there are disagreements about whether or not marijuana should be legalized there is a consensus that what people are smoking should be researched to make sure that it’s safe . As Blumenauer himself states in the congressional record:
Gone are the days of staunch rejection of anything to do with marijuana, as even those repelled by the smell can’t ignore the smoke ; Cannabis is undeniably a bipartisan issue. Recognition that it is no longer politically feasible to ignore questions of health, safety, and legalization are contributing to a changing political climate. Politico reports:
So, what does this tell us about the future of Marijuana legalization?
Well, not much. Despite this change in tone, very little seems likely to occur on the Federal level; as of yet there is no tangible plan to pass anything substantive. This is because any plan to Federally legalize Marijuana would come with many other provisions attached. What this does mean, is that the question is no longer “should cannabis be legalized?” but rather “how and under what conditions?”
Some, like Rep. Alexandria Ocasio-Cortez are seeking to have criminal records expunged for those with non-violent cannabis-related offenses . Others are less concerned with amending the injustice of cannabis criminalization’s past and are focusing more on companies having access to Small Business Administration programs.
Where does this leave the average weed smoker?
Even if full legalization on the Federal level may seem like a pipe dream, smokers can better trust what’s going in their pipes because the government has made it easier for cannabis related research to occur. If it’s a sign of anything, it is that the act of smoking is getting safer as what is being smoked is becoming more transparent.
Additionally, as cannabis becomes normalized State governments are filling in to legalize, tax, and regulate marijuana. On the state level, it is becoming an inevitability due to the overwhelming support for it. As KHN writes:
Those kinds of margins are what caused state Rep. Derek Skees to reconsider a bill he was drafting to repeal the Montana ballot measure in anticipation of its passage.
Skees told the Missoulian the day after the election that after it became clear voters supported it — while also supporting Republican candidates for office up and down the ballot — he decided to shelve it.
Even Red states are turning Green, showing the Cannabis may be the true bipartisan issue.
2022 has been a difficult year for cannabis operations to secure capital with raises off 64.5% YTD. The cannabis cultivation and retail sector has been hit the hardest, with total capital raised down 67.0%, and more notably, equity capital raised dropping by a whopping 96%.
Go to any investor pitch competition or capital conference, and legions of worthy, viable cannabis operators are all vying for attention from the same limited number of equity investors actively participating in the market. Few of them will actually secure investment, and for those lucky enough to succeed, not as much capital is being offered as in years past.
In fact, 2022 has produced no cannabis equity deals valued above $25M at the time of this writing.
All this, while nearly 1,000 cannabis entrepreneurs are competing for New York’s first 150 dispensary licenses. For those who do win them, where does the capital come to build out operations, stock inventory, and run operations as business ramps up?
In years past, private equity investors were more accessible and eager to participate in the exciting, emerging market. The better your company promised to solve a problem, the larger the check they’d be willing to write. Today, with equity options having all but dried up, cannabis business debt financing is the highest in the industry’s history.
Alternative lending made up 54.4% of total capital raised through September of 2022, and for many operators, this sort of access to capital makes a whole lot of sense. With capital deriving from private sources, alternative lenders aren’t beholden to the same industry restrictions as banks, and the right ones can offer competitive financing terms and interest rates for cannabis operators.
National Business Capital
One such lending company is doing just that. National Business Capital (NBC) has enjoyed success in conventional business lending since the founder, Joe Camberato, began the company out of his bedroom in 2007. Fifteen years later, the lending marketplace includes over 75 lending partners and has eclipsed $2 billion in total business financing.
With an impressive Trustpilot review score of 5.0 from over 2,000 reviews, National Business Capital has proven itself to be a consistent provider of customer satisfaction and successful funding.
National Business Capital’s foray into alternative lending for the cannabis industry began five years ago, and over $20 million in capital has been funded to marijuana and CBD operators since. The company has successfully helped businesses across nearly every touchpoint of the market, from consumption devices, to cultivators, and even cannabis marketing and business development agencies, with an approximate breakdown as such.
Hemp & CBD Products (20%)
Marijuana Products (20%)
Consumption Devices (10%)
Cannabis Marketing and Business Development Agencies (5%)
Other Ancillary Companies (20%)
According to Camberato, his company’s CannaBusinessfinancing is primarily used by cannabis operators for facilitating business growth, helping cover business expenses, and venturing into new business opportunities.
To qualify for cannabusiness funding through a National Business Capital alternative lender, a cannabis operator need only meet the following criteria.
1 year in business
$10K in monthly revenue
No minimum FICO score
Rolling in Wins with a New Pre-Roll Machine
One of National Business Capital’s clients is now enjoying exceptional returns in the financing of an automatic pre-roll machine. With a $750,000 total ticket price, NBC was able to finance the equipment over four years, with a manageable monthly payment, at a competitive interest rate, all while preserving equity in the company.
“It’s really important to pull in the right lending products, because on an equipment deal the collateral is that piece of equipment and you actually leave your cash flow in your business and receivables unencumbered,” Camberato explained.
Introducing the new pre-roll machine allowed the cannabis company to better optimize its resources. With automated production, the company no longer required eight employees to hand roll products. Those critical human resources were reassigned to other parts of the business, generating greater value and contribution.
“This company was able to buy the machine, and the payment of the machine versus what they were paying eight employee salaries was like one 10th of that cost,” Camberato said. “The payment was maybe one or one and a half employee, so they basically saved 80% of what they were paying in salaries.”
“If they didn’t do this deal, it would would’ve cost them more money,” Camberato explained. “By doing it, they saved money, and those awesome employees that they had, they put into other parts of the business where they really needed people.”
The NBC financed pre-roll machine yields multiples of product quantity than were possible before, with greater product consistency.
“A lot of companies don’t even realize there’s a lot of equipment lenders that’ll do that stuff, especially that size,” Camberato said. “So that was a really special deal that we got done.”
Russia’s invasion of Ukraine on February 24th, 2022 spelled further disaster for the industry by disrupting the critical fertilizer supply-chains that sustain cannabis production globally. Together, Ukraine and Russia produce 28% of the NPK fertilizers (nitrogen, phosphorus and potassium) sold on the global market. The resultant sanctions placed on Russia by the United States, have, in effect, cut-off the global market from the largest exporter of fertilizers and soil nutrients. As a result, fertilizer prices have skyrocketed within the United States. Modern Farmer reported that, over the past year, the price of anhydrous ammonia rose 225%, liquid nitrogen rose 192%, and Urea rose 149%.
Huston Hoelscher, manager of the environmental sciences group and senior pest control advisor at Urban-Gro, a Colorado based cannabis cultivation facility design and engineering firm, said that without these critical fertilizers, farmers will experience lower yields and produce lower-quality products.
Furthermore, Liz Geisleman, the co-founder of Canna Consortium and acting CEO of Rocky Mountain Reagents, predicts the industry will experience supply-chain disruptions to other key inputs such as solvents and packaging. Geisleman adds that skyrocketing gasoline prices caused by US sanctions have also disrupted cannabis delivery firms, placing greater strain on the industry.
Alain Menghé à Menghé, the CEO of Lio Pharmaceuticals, adds that rising energy costs will impact more than just transportation, but also the storage and production of cannabis. Furthermore, he insists that with the war raging on, the EU will deprioritize regulatory changes for cannabis use until the conflict is settled.
Bill Gorman, the sales director at Botanical Extraction Huber USA, advises others in the industry to follow the three Ps: “Patience, Patience, and Plan B.” He recommends businesses line up secondary sources for their core materials, adding that “if you don’t do that, then you just put all your eggs in one basket.”
Lauren Fortier, the director of cultivation for Theory Wellness, a Massachusetts based marijuan company, offers a solution for domestic cannabis producers. Fortier recommends the adoption of regenerative farming techniques which ‘close the loop’ by recycling or reusing resources in as many stages of a plant’s life cycle as possible. This has allowed regenerative farmers to insulate themselves from supply-chain disruptions.
Regenerative farming techniques include, but are not limited to:
Capturing and reusing wastewater
Using eco-friendly packaging
Using living soil which doesn’t require additional nutrients
The incorporation of an integrated pest-management system through the use of specific insects, mites, and other organisms
Utilizing outside air in greenhouses to lower temperatures; thereby reducing energy consumption
Fortier has already deployed many of these techniques at Theory Wellness, stating, “all of the things that we use are either reused or genuinely grown on our farm or sourced locally.”
As it stands, regenerative farming techniques provide a path forward for the domestic cannabis producers, allowing them to insulate themselves from the current and potential future disruptions to supply-chains.
Prior to the outbreak of the war, Ukraine’s government was pursuing cannabis legalization. In the fall of 2020, the Zelensky administration issued a study finding that two million Ukrainian cancer patients could benefit from medical cannabis since it provides a safe alternative to addictive painkillers.
In July 2021, the Ukrainian parliament voted on bill 5596 which would legalize cannabis for medical use. However, the bill failed to reach enough votes to be passed. Only 184 members voted in favor, with 33 voting against and 61 abstaining. As a result, the bill was sent back to be revised.
The Zelensky administration followed up in October 2021, holding a nation-wide poll in which over sixty percent of respondents supported cannabis legalization.
In the following December, the Commission on Narcotic Drugs, the governing body of the UN Office on Drugs & Crime, struck cannabis from Schedule IV of the 1961 Single Convention on Narcotic Drugs, the international treaty which regulates drug control policy.
In January, the international rescheduling of cannabis in conjunction with popular support, led the Zelensky’s Cabinet of Ministers to introduce a bill to the Verkhovna Rada, Ukraine’s parliament, with the intent of legalizing cannabis for medical use. The bill intends to legalize herbaceous cannabis flower for use, but place the importation and distribution of cannabis under the jurisdiction of the national police. However, with the outbreak of the invasion, legalization efforts were put on the backburner.
This would begin to change on April 7th when Ukraine’s Cabinet of Ministers issued a decree legalizing certain cannabis products for medical use. This includes THC analogues such as dronabinol, which treats weight loss in AIDS patients and chemotherapy-induced vomiting and nausea; nabilone, which also treats nausea caused by chemotherapy; and nabiximols, a THC-CBD extract used in the treatment of multiple sclerosis.
This decree builds on years of progressive activism within Ukraine. Since 2005, Freedom March, a progressive drug policy advocacy group, has led demonstrations throughout Ukraine in support of legalization and to defend the rights of medical cannabis patients. Since the outbreak of the invasion, a majority of Freedom March members have engaged in resistance to the Russia invasion. Some have taken up arms to fight on the front lines, while others have provided humanitarian aid in cities under attack by Russian forces.
As part of its humanitarian mission, Freedom March launched Cannabis Stands with Ukraine, a fundraising campaign to secure donations from the global cannabis community. Freedom March has outlined two key causes to support with the money they fundraise: first, to provide shelter, food, and physical and mental recovery to children who were injured or lost their parents in the war; second, Ukraine’s medical cannabis patients who’ve experienced medication shortages due to the conflict.
“Together with our friends from the local community, we are working to find a way of providing CBD-based medication to those who need it urgently: epileptic patients and wounded soldiers above all,” says Nazarii Sovsun, a member of Freedom March. “Hopefully, this war makes it obvious to our politicians that people should have access to medical cannabis, so we are active on the legal front, as well.”
The efforts of Freedom March have not gone unnoticed by the Ukrainian government. On June 7th, Viktor Liashko, the Ukrainian Minister of Healthcare, wrote on Facebook that the Cabinet of Ministers had approved a bill to regulate “the circulation of cannabis plants for medical, industrial purposes, scientific and scientific-technical activities to create the conditions for expanding the access of patients to the necessary treatment of cancer and post-traumatic stress disorder resulting from war.”
Liashko further adds that this bill will ensure a “full cycle of cannabis-based drug production in Ukraine,” leading to the development of a domestic cannabis industry in Ukraine, rather than depending on imports.
This would be a major change within the global market. In the status quo, Ukraine’s role in the cannabis market is very limited. Ukraine does not supply any cannabis for the medical market, but rather exports hemp seeds for cultivation across Europe. If this bill were to pass, Ukraine would have “a leading position among hemp suppliers” and “would lead to the revival and development of Ukraine’s processing industry.”
With the Russian invasion of Ukraine raging on, and its subsequent disruptions to global supply-chains wreaking havoc on the cannabis industry, an investigation into the region’s history with cannabis and the war’s effects on the industry is crucial.
Cannabis has long played a pivotal role within eastern Europe. Contemporary anthropological research has found that cannabis was likely introduced into southeast Russia and Ukraine by the Scythians, an ancient group of nomadic warriors from modern day Siberia, as early as 3000 BC. Since then, cannabis has been an indispensable part of Ukrainian and Russian agriculture, providing food, clothing, medicine, textiles, and fuel.
The versatility of cannabis, when used for industrial purposes, made it a critical commodity crop and export of the Russian Tsardom since the beginning of its mass production in the 16th century. Hemp exports remained small until the 18th century, when Great Britain began solely utilizing Russian hemp for its naval rigging. Throughout the 18th century, the percentage of Russian hemp utilized for Britain’s navy soared to 96% while total hemp exports soared to 32,000 tons.
However, with the explosion of American cotton production in the 19th century, Britain switched from hemp to cotton, leading Russia’s exports to decline. Despite this, the Russian empire remained the largest exporter of hemp, accounting for 50-75% of its total exports. By the end of the century, the Russian empire produced 140,000 tons of hemp annually, accounting for 40% of Europe’s hemp production.
This would remain the case after the Russian Revolution, and the Soviet Union’s rapid industrialization. During Ukraine’s period within the Soviet Union, it was one of the largest hemp manufacturers in the world. Between 1950 and 1960, Ukrainian hemp production increased over six-fold, rising from 15.3 hectares of cultivated land to 97.4 hectares. However, after the 1961 UN convention listed cannabis as a narcotic substance, hemp production began to decline. By 1970, land devoted to hemp cultivation dropped by 33%. By 1990, only 10 hectares remained.
Since then, hemp cultivation has continued to decrease every year. This is due to a litany of factors including an insufficient number of processing plants, the remoteness of those plants from hemp producers, complex regulatory policy, and the instability of prices for hemp products.