Launching any new business is a risky proposition. You've got to get the word out to potential customers quickly or risk going under.
The same is true for Ohio's fledgling recreational adult use cannabis industry. But proposed new rules could drastically limit dispensaries ability to advertise.
The Ohio Division of Cannabis Control has proposed new rules that, among other things, would bar marijuana retailers from advertising on billboards, radio, television, the Internet or anywhere else deemed likely to reach kids under 18.
Mandy Morton is director of operations at Locals Cannabis Dispensary on Cleveland Avenue in Columbus.
Matthew Rand: Total recreational sales across the state passed the $200 million mark earlier this month and continue to grow. How much of that has been at your store and how does this demand compare with what you were expecting?
Mandy Morton: Yeah, we definitely have increased sales since we opened our doors to non-medical customers. We have, month over month, gone up 50%, 100%, another 100%. So, we have definitely grown since August. And you're absolutely right, advertising is one of our biggest hurdles and we're hoping that we can continue to work in this space that will allow us to stay compliant, but also maybe try to stretch it a little bit where we can do some things that we haven't been able to do in just the medical space.
Matthew Rand: How are you getting the word out? What sorts of advertising have you been able to do, if any, and where are you seeing the most success connecting with new customers?
Mandy Morton: We've pretty much stuck to the social media side. Everything does have to be reviewed and approved by the Division of Cannabis Control. That can be a little difficult because they do not allow us to pretty much do anything fun. So, anything that is outside of a medical educational space or just advertising our hours, that's pretty much our limit. So, we do try to do different things, but they do keep getting shot down by the DCC.
Matthew Rand: Billboards advertising dispensaries are a common sight on highways in other states, including Michigan, which began its recreational marijuana sales program in 2019. I think what Ohio regulators are saying is they don't want a similar landscape here, with concerns about kids seeing those billboards and being influenced by them. The way you see it, though, are those concerns fair?
Mandy Morton: I do see it both ways. I'm originally from Michigan, so when I go back home to visit family, it can be a lot. The billboards are everywhere. I wish we could find a middle ground where we could have some type of outside advertising that didn't have to be attached to our building. That makes it really difficult to get the word out. We do our best to try to get our customers to tell their friends. That's obviously something that we cannot control. But outside of any type of paid advertising, our hands are tied at this point.
Matthew Rand: On the other hand, the ballot measure Ohio voters approved last year was called the “Regulate Marijuana Like Alcohol” initiative. We have ads for alcohol all over the place, including broadcast and online. So should pot be any different?
Mandy Morton: I don't think it should be any different. It's frustrating to drive downtown and see building-length advertising for alcohol, knowing that we're right down the street and can't put anything up. So that makes it hard to compete with liquor. Hopefully as the market matures and everybody gets comfortable with it, maybe we can see some changes down the road. But right now, that rule package six that came out does not really give us much room to do anything.
Matthew Rand: Finally, what would these proposed restrictions mean for your bottom line if you're not able to advertise virtually anywhere?
Mandy Morton: I think that luckily this industry, the people that consume cannabis, the stuff that they're looking for, that we see in these big ads in Michigan, we're not going to be able to do anything like that. And hopefully consumers will just understand that it is a much different space. As long as we can start to implement some of the things that other states are able to implement, such as pre-rolls and, you know, maybe having those sample sizes. I think that's going to be a big difference. If we can just get pre-rolls, I think people would be happy.
