Puncturing 3 More Cannabis Myths
“The way in which we see things can hardly be distinguished from the way in which we wish to see them.” Joseph Schumpeter
My recent post on cannabis myths (link in comments) garnered a lot of positive engagement, including private messages. Thank you. Many DMs wanted me to address some other industry myths.
Here goes-
1. “North American Cannabis is a growth industry”
Yes and no - and not for everyone. Without a doubt, new/pending markets are accretive to the total market. And many existing jurisdictions such as New Jersey and New York have plenty of growth left in them.
However, some mature markets like Colorado, Illinois and California are experiencing (legal) market flatness and even decline. It’s reasonable to believe that tax and regulatory reform could fix this but that’s hardly a consolation for a retailer or producer seeing their revenues and profits dipping NOW in the hope something changes LATER.
If they are not well-established in mature markets or targeting new ones, some MSO will find themselves struggling to find profitable growth.
Finally, market size and growth is important but not in itself, sufficient. There is no guarantee firms will be profitable or sustainable. See Canada.
2. “My brand/product is different”
Are they really that different, and on what basis? If a mass cultivated strain like Blue Dream was Pepsi challenged (i.e. blind smoked), I doubt most consumers could tell which brand is which or if they were even smoking Blue Dream. Fact is, there are few strong brands in cannabis; widespread product confusion and misunderstanding continues to plague the sector.
Being different also doesn’t mean your brand will be desired. The point(s) of difference must be meaningful to the channel & consumer and marketed well to deliver sales.
3. “Most Americans want legalization and decriminalization”
Yes, according to polls. The inference is that these people will support our goals. However, one should be mindful of Carl Jung’s dictum, “You are what you do, not what you say you will do.”
Sadly, most people don’t back up words with support. To achieve legalization, individuals need to take action such as voting for pro-cannabis politicians, contributing to advocacy groups and purchasing from legal businesses. This goes for cannabis companies too, in terms of supporting industry lobbying and legal efforts (e.g., Boies lawsuit).
Encouragingly, stigma is fading. However, reducing stigma doesn’t mean you are creating legions of pro-legalization soldiers; it might just mean more apathetic fence-sitters.
Finally, we need to acknowledge that the current regulatory mish mash benefits some groups including certain MSOs, illicit players and, yes, consumers. They will prefer the status quo.
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