How to Approach Paid Media as a Cannabis Company

For small and large businesses alike, navigating the cannabis industry is no easy task. You have to match cultivation, manufacturing, and sales processes to the nuances of a highly-regulated industry, for starters. You must also develop marketing and advertising plans that fall in line with state and municipality-level compliance standards. 

While effectively promoting your cannabis business in this confusing climate is difficult enough, you also need to navigate the digital landscape. As seen with more traditional types of advertising, cannabis companies face more restrictions than other businesses when it comes to digital marketing. 

With major digital ad providers like Google banning cannabis ads, paid media is one of the most challenging types of digital marketing in the industry. We developed this introductory guide to help you better navigate the paid media landscape.

cannabis company display advertising

Identify Your Target Market

The first step for approaching a paid media campaign as a cannabis company is identifying your target market. 

By clearly understanding your target demographics, you can design ads that appeal to the right people and choose the correct paid media avenues through which to run ad campaigns.

B2B vs. B2B Sales in Cannabis

Before you can hammer down on specific traits for your target market - such as age, gender, and income level - you need to understand the difference between business-to-business (B2B) and business-to-customer (B2C) marketing. 

As a B2C business, a chain of cannabis dispensaries in Denver, CO, would run a drastically different digital ad campaign than an ancillary service such as a vape hardware supplier. Not only is the vape hardware supplier targeting other businesses (B2B), but they don’t have to do business within state borders like plant-touching companies. As such, B2B vs. B2C marketing will significantly influence the target and scope of your digital ad campaigns.

Advertising Restrictions on Cannabis Products

Digital marketing in the cannabis business is much different than in other industries. Because cannabis is still federally illegal, many popular paid media providers have banned cannabis ads outright. Therefore, effective digital advertising in the cannabis space requires research into which avenues are cannabis-friendly.

Google Ads is one of the most popular digital advertising platforms in the world. Through Google Ads, marketers can advertise businesses on search engine results pages (SERPS) and websites in the Google network. Unfortunately, Google does not allow for the paid advertising of cannabis businesses within its network.

To successfully market your cannabis company in the Google ecosystem, you need to put your resources into organic SEO. 

YouTube has also banned any paid cannabis advertising because Google owns it.

Can I Run Cannabis Social Media Ads?

While there are specific workarounds for hemp-based brands, most popular social media platforms don't allow paid advertising for cannabis companies. Social media companies that have banned paid ads for cannabis businesses include Facebook, Instagram, and Twitter. 

As seen with the Google network, digital marketers in the cannabis space must develop organic followings with social media. This process requires serious dedication in developing intriguing content and the use of social media influencers. 

LinkedIn is one of the only mainstream social media networks that allow paid advertising for cannabis companies. Their Campaign Manager is an excellent tool for creating targeted and trackable pay-per-click (PPC) ads. 

As a B2B networking platform, LinkedIn ads are not the best fit for many cannabis companies. For example, running a paid campaign for a cannabis gummies (B2C) brand in California wouldn't make much sense on LinkedIn. However, marketing a cannabis accounting service to other cannabis businesses on LinkedIn could be an intelligent choice.

The Best Paid Advertising Avenues for Cannabis Companies

While cannabis companies face a good deal of restrictions with paid advertising in the digital environment, there are still plenty of opportunities to leverage.

To ensure that your marketing money is wisely spent, we recommend thoroughly researching different paid advertising options.

Programmatic Advertising

Programmatic advertising is an essential movement in the digital marketing space. By purchasing ad space within an extensive network like PrograMetrix, cannabis companies can display their ads on websites, blogs, e-commerce sites, and more. With this approach, companies work with one centralized platform to post ads with various cannabis-friendly digital publishers. 

Plant-touching cannabis companies can run ads on specific programmatic networks but will be scrutinized more than ancillary businesses.

Cannabis Websites and Blogs

One of the most effective ways to run a digital ad campaign for a cannabis business is to purchase ad space on a cannabis-centric website or blog, a form of contextual advertising. While this type of ad placement doesn't have the exposure of programmatic advertising, it does offer highly targeted marketing to relevant audiences. 

Established cannabis media companies like MJ Biz Daily and Maximum Yield offer cannabis companies various options for running digital ads.

programmatic cannabis advertising

Types of Digital Ads for Cannabis Companies

Once you have decided on the platform to advertise your cannabis company, you need to think about the digital ads you would like to run. 

There are several different formats that you can utilize for your ad campaign. In the end, your target audience and overall campaign goals will dictate your designs.

Popular types of digital ads include:

  • Display ads: Also known as “banner ads,” display ads are one of the most common types of digital advertisements. They generally featured attractive images and a small amount of text. You'll typically find display ads on popular websites and blogs.
  • Native ads: Native advertising is a form of content marketing. With native advertising, cannabis companies purchase article or blog space with media companies in their vertical. Because the content matches well with the media company, it is referred to as “native.” 
  • Video ads: Video ads are exactly what they sound like - videos that promote a cannabis company. Video ads are often displayed on websites or within PPC networks.
  • Mobile Ads: Mobile ads are digital advertisements explicitly designed to display and view on mobile devices.

      Establish Paid Media KPIs

      The final phase in running a paid media campaign for your cannabis company is to track its performance. 

      In the marketing world, the term KPI stands for "key performance indicators." Because KPIs are based on actual numbers, they provide solid data points for tracking the progress of digital ad campaigns. 

      Importantly, KPIs give your company a clear view of progress as measured against essential goals. 

      Your cannabis company can see which digital ad strategies are working and which are not by employing strategic KPIs. For example, a common KPI for digital ad campaigns is Return on Ad Spend (ROAS). You can calculate ROAS by dividing the revenue derived from an ad campaign by the cost of the campaign. A common goal for this KPI is achieving a ROAS of $3 each quarter. Meaning, you made three times the money you spent on ads for Quarters 1-4 each year.

      Start Your Campaign

      As one of the leading agencies in cannabis, we have poured our time and energy into identifying the best ways for cannabis companies to leverage paid media. Please get in touch with us for paid media questions, or to learn how it can be an effective strategy for your cannabis or hemp business.
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