Build Customer Trust: Cannabis Branding and Marketing Explained

Build Customer Trust: Cannabis Branding and Marketing Explained

Consumer brand and marketing expert Peter McDonough has joined forces with Trait Biosciences Inc. to help bring its technologies to market.

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October 5, 2018

Brand building becomes more important as the cannabis industry matures. And while some branding challenges and strategies are unique to this market, cannabis companies can look to other industries—such as craft beer and spirits—for guidance.

Peter McDonough, one of the world’s leading consumer brand and marketing experts, was recently appointed to the board of directors for Trait Biosciences Inc., a cannabis biotech company that has crafted technologies to help develop cannabinoids with improved onset, taste, stability and bioavailability. McDonough will apply more than 30 years of experience from his work in the alcohol, beverage and consumer product industries to help bring Trait’s technologies to market.

Here, McDonough discusses his experience, the new role with Trait, and branding and marketing best practices for cannabis companies.

Cannabis Business Times: Can you briefly describe your background and what led you to join Trait Biosciences’ board of directors?

Peter McDonough: I’ve had the privilege of building iconic brands and led numerous new product initiatives in a wide range of consumer categories, ranging from power tools to health and beauty care to my most recent role in beverage alcohol. In each of these experiences, I was excited by the opportunity to learn the motivations of consumers in each of these disparate product categories.

As I began studying what was happening in the hemp and cannabis industries, it became clear that the market was quickly shifting from a conversation about cultivation, strains and flower to become a discussion about building sustainable brands of scale—and I immediately wanted to play a role in leading this evolution.

In understanding the consumer’s interest in quality assurance and a more predictable experience in the CBD and cannabis markets, I was quickly drawn to the technology and IP that Trait Biosciences could bring to new product innovation and brand building, particularly in beverages and edibles. I’m excited to now play a role on Trait’s board of directors in bringing their IP to market. I believe their technology will play a critical role in helping new CBD and cannabis beverage brands satisfy the desires of the increasingly sophisticated consumers coming into the hemp and cannabis categories.

CBT: What are you hoping to contribute to the company as a board member?

PM: As someone who has devoted my career to building consumer brands in multiple categories, I was immediately impressed by the capabilities that Trait’s technology and IP represented in building a medical or consumer brand proposition in CBD and cannabis products. The intellectual property that Trait scientists have developed offers approaches to maximizing the quality and safety of cannabis and CBD products, which represent a critical foundation for building a sustained consumer franchise.

As a board member, my goal is to help Trait inform producers and consumers of the benefits that Trait IP offers in their product development and production practices. In particular, I’m very excited by the water-soluble CBD that Trait IP is able to produce—something that I know will be of great interest to my peers in the beverage industry. Having water-soluble CBD is a breakthrough advance that ensures a shelf-stable, quality beverage, without the inevitable oil and water separation that happens with emulsions. Trait’s water-soluble CBD are created using more advanced science than the alternative nanotechnology, which simply creates water-compatible CBD.

CBT: What are some characteristics of brands that successfully resonate with consumers?

PM:  First and foremost, I think it’s critical for a brand to create a foundation of trusted quality and safety assurance. This is particularly true within the cannabis and CBD market sector.

Second—and like the beverage industry—I think it’s critical for the brand to make an emotional connection with its consumer target and provide the consumer with social currency. But that is secondary to the importance of the brand proposition being delivered in a safe and reliable way, particularly in cannabis- or CBD-infused beverages. Our water-soluble IP solution provides this assurance.

CBT: What are some common branding and marketing challenges that cannabis companies face?

PM: As our industry continues to evolve from small operators to larger scale producers, one of the important challenges that new brands face is the need to position themselves in the eyes of the consumer as a trustworthy choice. The brands that build trust—ensuring consistent quality and ingredients—are the ones that will rise to the top of the market.

Trait has a significant advantage in assuring this trusted quality because Trait has technologies that limit, or eradicate, the need for many herbicides and other chemicals in the production and cultivation processes. Also, because we have a unique process that creates truly water-soluble cannabinoids—dissolving in water similar to sugar—we can communicate that our CBD [compounds] are metabolized by the human body in an easily understood and natural process. As people become more familiar with how cannabis- or CBD-infused beverages are produced, I believe they will become more appreciative of the advantages that water-soluble CBD provides when compared to water-compatible CBD, which [is] created using emulsion technology.  

CBT: What branding and marketing strategies can cannabis companies borrow from craft beer and spirits companies?

PM: I think the brands that are of greatest interest to consumers are brands that are authentic and have an interesting “back story” surrounding how they are made and the values or purpose they represent. The best craft beers and spirit companies have learned this and there are numerous examples to choose from, ranging from Lagunitas beer to Pappy Van Winkle bourbon.

At Trait, our brand is crafted and defined by taking the genius of our world-class researchers and distilling it down to technology that creates the foundation for producing safe and reliable products for people. We call it “Genius. Distilled.”

CBT: What are some best practices for cannabis companies as they build brands in the space?

PM: Building a great brand is an art rather than a science. And it’s a process that takes time rather than a quick set of tactics surrounding a product launch. So, it would be inappropriate to respond with a formulaic answer, but I think great brands start by clearly identifying the needs of their target consumer and build a sustained consumer franchise by creating a proposition that is clearly communicated to address the consumer need or motivation and stimulates enough interest to generate trial of the product. Once trial has occurred, the brand needs to maintain continued use by consistently delivering against the consumer promise and by providing constant assurance of product quality while never breaking consumer trust.

CBT: What avenues are available for cannabis companies to market their brands?

PM: One of the best avenues for building a cannabis brand is the age-old, tried and true practice of building consumer advocacy by word of mouth. Consumers consistently cite that the most important influence in their decision to try a new brand is when it’s stimulated by the recommendation of trusted friend. A good product, that is safe and reliable, and which satisfies consumer expectations after trial, will eventually create broad consumer advocacy and gain market momentum.

Influencers, such as budtenders, and brand activation and experiential programs at social or cultural events will also play an important role in building cannabis brands. It’s also important that marketers actively improve the quality and efficacy of their brands by working closely with their R&D team to bring innovation into their brand promise. In looking at the emerging segments of beverages and edibles, I think a great example lies in the benefits of water-soluble CBD for cannabis products versus our industry’s earlier use of emulsion and nanotechnology to create water-compatible CBD.   

CBT: What are some marketing and branding mistakes that you’ve seen in the cannabis industry (or other consumer industries) and how can these be avoided?

PM: There are books written on the numerous ways to destroy brands, and I suspect new publications will soon contain examples of cannabis brands. But I think the simplest answer is that failed brands most often involve some aspect of failing to build consumer interest and trust.  If you make a relevant promise to consumers and your product is compromised by either inconsistent quality or lacking performing versus your brand promise, the brand will never be successful in building a sustained consumer franchise. What the Trait brand offers through its technology and IP is an assurance of quality and safety, which will build that consumer trust.

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