Canadian cannabis brands are having trouble garnering recognition

Published Sep 4, 2020 12:00 p.m. ET
iStock / OlegMalyshev

Like with any industry, name brands are important tools, but cannabis businesses say that they’re suffering from a lack of brand recognition among consumers, and this is a problem that they are trying to figure out how to fix while remaining within strict regulations surrounding marketing and advertising.

What is brand recognition?

When you think of chocolate spread, the name Nutella likely springs to mind as it’s the biggest name brand of that product in Canada. The same holds true for peanut butter, which we all know as Kraft, and then there are big drink name brands like Coke or Pepsi. When you read the name of a company and can recognize what they do, visualize the products they offer, and think fondly or adversely about them based on personal experience or exposure, that is brand recognition.

Why is it important?

Sure, it sometimes seems like a good idea to take a risk and buy products from a company that you don’t know, but brand recognition establishes a whole level of trust and awareness that simply isn’t possible as a nameless, faceless business. When we see something new released from one of the many big brands that we know and love, we are much more willing to view a purchase of less of a risk, and with a higher chance of reward which is motivating when you’re considering spending your hard-earned money.

Big-name brands also have the luxury of testing out brand new wild ideas through advertising, surveys, events, fundraisers and releasing products without losing their history or the trust of past customers, which means that if the public doesn’t respond well to something, they can easily revert to what they were doing and suffer minimal loss for the poor decision. As you can see, this is a powerful tool that all cannabis brands want to have the chance to hold, but it’s not easily achieving in a highly regulated region like Canada.

Cannabis marketing problems

Cannabis marketing is nearly impossible in the current climate today, with so many rules and regulations that have prohibited cannabis brands from participating. They are not allowed to join forces with non-cannabis industry brands. They also can’t openly advertise their products in the same way that wine or alcohol is sold, and due to the lingering taboo that remains in many parts of the world that have yet to introduce legalization, cannabis brands are banned from advertising on popular social media platforms such as Facebook and Twitter, leaving them very few viable options with any reasonable consumer reach.

How many recognize actual cannabis brands?

According to a survey that was conducted by Brightfield Group, which was comprised of 3000 respondents, the majority of cannabis brands are only recognized by between 1% and 15% of their customer base. The most recognized is Canopy Growth sitting at 41%, and the second is Aurora Cannabis coming in at 34%. When only 1-15 out of every 100 people who use your products don’t even know who you are, and you have no way to advertise to them, how do you establish a lasting relationship or trust?

What needs to improve

If you’ve never heard of a cannabis business social network, then you are not alone, but this is the only real means of advertising for many cannabis brands and until that changes, it’s going to be incredibly difficult for less established companies to make any headway in the market. We need to loosen restrictions to match those that are imposed on alcohol, and if we don’t, the legal industry could be struggling even more than they have been, which isn’t a good thing for businesses or consumers.

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