How a major cannabis marketer pivoted during the pandemic
As it markets pot to the masses, cannabis company Cresco Labs has often relied on its secret weapon—Mindy Segal, a James Beard award-winning pastry chef who partnered with the company to make a line of cannabis-infused edibles called Mindy’s. The Chicago-based chef has touted the treats at live events, including one called “Flavor Trip,” that was held earlier this year at her restaurant, Mindy’s Hot Chocolate, targeting retail buyers and other influencers in Chicago’s arts community.
But those and other experiential events that are a cornerstone of cannabis marketing are now impossible with Illinois and other states where Cresco operates under lockdown due to the coronavirus. As a result, Cresco has had to overhaul its marketing.
“We’ve moved from experiential and education that is more alive to experiential and education that now we are trying to do through content, through digital forms,” says Greg Butler, chief commercial officer at Cresco Labs, one of the largest vertically integrated multi-state cannabis operators in the U.S.
Butler—who joined the Cresco Labs in early 2020 after stints at big advertisers like Pfizer, Johnson & Johnson and Molson Coors—explains on the latest episode of the “Ad Lib” podcast how the company has pivoted. He also breaks down Cresco’s portfolio approach, under which it has created distinct brands for what he sees as the three distinct segments of the cannabis industry: medical, wellness and recreational.
“We recognize that those consumers are very different in their needs,” he says. “That takes you away from a branded house into a house of brands, where we have different brands for different consumers, addressing different needs.”
As with many industries, the pandemic has been a mixed bag for the cannabis market. While cannabis operators have been deemed essential business in many states where pot is legal, social distancing has meant dispensaries cannot function as normal. Regulations vary by state. For instance, the state of Nevada shut down in-person dispensary visits, but allowed delivery services and later loosened the rules to allow for curbside pickup. In Illinois—where Cresco runs several dispensaries branded “Sunnyside”—regulations allow retail outlets to open, but they must adhere to social distancing rules requiring patrons to be at least six feet apart.
The measures have not dampened demand. Pot shops sold $37 million in recreational weed in April, trailing only the $39 million monthly total in January, when recreational pot first became legal in the state, according to a recent report in the Chicago Sun Times.
Still, the rules have forced major changes at Cresco, which had previously emphasized in-store experiences in which associates would spend a lot of time educating consumers about the newly legal category. “Obviously, with everything going on right now it would be irresponsible for us to do that—to have that many people in our stores,” Butler says. “We’ve really changed our entire business model from in-store browsing to pre-order pick-up, priority pick-up for medical patients, and really eliminated that in-store browsing piece to more of a virtual browsing piece,” he said, referring to website upgrades that include real-time inventory information.
The marketing changes include more digital. That includes sponsored content, such as a deal with Vice. One article is called “A Guide to Smoking Solo: From virtual smoke sessions to creative indoor activities, here’s how to smoke weed while self-isolating.” The series was sponsored by High Supply, a new brand Cresco recently unveiled aimed at the economy end of the recreational pot market.