Local Advertising 101: How to Market Your Dispensary or Cannabis Business

on February 13, 2018

Businesses servicing the cannabis industry currently face a plethora of regulatory hurdles, as well as increased competition. State laws require dispensaries to keep their marketing efforts within their state borders. They also require that creatives run by dispensaries do not target children. Licensed product manufacturers, extraction companies, and producers are all in the same boat.

Geo-targeting Obstacles Plague Many Cannabis Businesses

Being required to geo-target local markets severely limits your potential reach from the get-go, but it is also a key component to reaching the right audience while adhering to local laws. For example, a Denver-based medical marijuana dispensary will need to geo-target their advertising campaigns to an audience aged 21 and older, but only to those who live within the state of Colorado. The concept of geo-targeting isn’t the issue; the real issue is the lack of accessibility to platforms that can offer geo-targeting at scale.

So how does a cannabis business attract more customers and drive more awareness at a local level without targeting out-of-state viewers or children? Well, if you’re like most advertisers, you’re first inclination is probably to go to mainstream ad platforms like Google and Facebook to setup a handful of geo-targeted ad campaigns specific to your state(s). The problem many businesses run into with this strategy is that like other forms of traditional media (e.g. print, TV, billboards, radio stations, etc.), Google and Facebook also have very restrictive ad policies that disallow cannabis-related advertisements from running on their platforms.

Dispensaries: There Are More Ways to Advertise Than Pins on a Map

Traditionally, dispensaries and delivery services would be forced to pay premiums to advertise their business on popular websites like Weedmaps or Leafly in the hopes of attracting more visitors to their dispensary, simply because that’s all that was available. However, times are changing and platforms are beginning to takeover.

As we discussed earlier in this article, the more geo-targeted a campaign is, the more limited its total potential reach becomes. Because of this, local advertisers should strongly consider the ROI and eCPM you’re seeing when spending money at any individual website or app (including Weedmaps/Leafly) vs. network-wide campaigns on a service like MANTIS which connects hundreds of publications under one umbrella.

Traffic Comparison: MANTIS vs Leafly vs Weedmaps

Let’s take a look at website and app traffic data from Quantcast to illustrate the difference in unique reach per solution:

When comparing Quantcast data over a 30 day period, one will discover the following:

  • Weedmaps reaches 1.5M people in the US, but only ~195,000 people in California.
  • Leafly reaches 4.6M people in the US, however they currently hide how many unique readers they reach in California.
  • MANTIS reaches 19M people in the US, and 2.5M people in California alone (more than Weedmaps reaches in the entire United States).

Next, let’s assume you run a LA based dispensary and only want to target Californians. Knowing the information above, which solution do you think has the capability of offering an impactful local campaign?

Important Questions to Ask When Running Local Campaigns

Before allocating your market budget to any given campaign, ensure your ad partner is transparent and provides answers to all of the following questions:

1) “How many total unique visitors does your website or app reach per month in the US?”

Don’t be swayed or tricked by how many overall visitors a service claims to reach. The answer to this question is often very misleading, but it does help you get a sense of the scope of the seller’s service while providing a basis for the next couple of questions.

2) “How many unique visitors do you reach in the state(s) or metro area(s) we’re looking to target?”

Next, be sure to ask for the seller’s unique reach in your desired [local] target market(s). For example, Leafly’s marketing page (shown below) claims to reach 13 million monthly visitors despite Quantcast reports that show the service reaches just 6 million global unique readers per month. That’s a big difference, so which is it?

It’s important to note that Leafly isn’t fibbing about their numbers. The term “visitors” is often used interchangeably with either page views/sessions, so it’s more vague than incorrect… but hopefully you are beginning to see how a website boasting its overall global reach can be misleading for unseasoned advertisers who are unfamiliar with the terminology and expect to really reach that many people.

3) “What is the avg. CPC, CPM, or eCPM rate for this campaign?”

Once you understand how large the potential opportunity is, you’ll want to know how much to budget for your campaign(s). Most digital marketing campaigns are sold on a cost-per-click (CPC) or cost-per-mille (CPM) basis, although some publications do sell on a fixed monthly schedule (i.e. $500 for 30 days for a 728×90 leaderboard ad) or on an eCPM basis (a mixture of CPC+CPM). As the advertiser, you want to collect rates from each seller and compare apples to apples to determine which is the best value for you. Confused on which payment method is best for your business? Click here.

Note: The more targeted your campaign is to a local market, the higher the rates tend to be. Because of these cash savings, many dispensaries and cannabis businesses choose to target an entire state rather than by ZIP code (which is often limited in reach as well as being pricier).

4) “How many other advertisers are targeting the same audience?”

This question is especially important for single websites as they are effectively splitting up their local traffic, which is already very limited in most DMAs. For example, if a website only reaches 1M people / month, with only 1 ad placement available per page, then your maximum available reach is ~1m visitors. However, your potential audience size is instantly cut in half (to 500K people) once the seller adds just 1 more advertiser to its ad rotation. A similar setup with a seller managing 10 different advertisers simultaneously would result in you only getting access to ~100K visitors in a given month.

As we mentioned in question #2, don’t be swayed by a seller’s overall reach figures; dig into the nitty gritty and determine what your Share of Voice (SOV) really is. Then compare the actual expected reach with other marketing options available to your company.

If you are already paying for your business to be listed on a locator tool or another similar service with a set amount of listings available, double check to ensure your campaign is getting the reach you expect; you may be surprised how small your actual reach is in your desired target market.

5) “About how many people will my ad reach in a given week/month?”

Don’t expect exact figures at this stage (as it is impossible to predict the future); the point of this question is to confirm everything you’ve learned from asking questions #1-4. How the salesperson answers this final question will tell you a lot about their experience and if they are talking out of their $%#.

Gauge how much knowledge they have about their own platform and determine whether or not you want to work with their company to market your brand. Does their answer to this question make sense based on the overall reach their entire platform has to offer, compared to how many advertisers they already work with utilizing similar targeting requirements as you? Now is the time to identify any red flags with the information you’ve been told and your chance to receive further clarification if there is any confusion on your end.

Note: All legitimate advertising solutions should be able to answer these questions without any issue, giving you the ability to easily compare different offerings in the niche in an objective way.

Don’t accept excuses from ad sellers on the lines of “Oh, we don’t have those metrics available at the moment…” or, “we don’t share that information with our clients.” If a company won’t share this information with you about their website, app, or platform, then what else could they be hiding? Run and don’t look back.


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