About 70 percent of the US population live in states where cannabis for both medical and recreational use is legal. The global CBD market size was valued at $US 2.8 billion in 2020 alone. It is estimated that the cannabidiol market will experience a compound annual growth rate of 21.2% between 2021 and 2028.
Even as cannabis laws continue to change in the US and worldwide and consumers continue to embrace CBD products, CBD marketers still face many hurdles when advertising their products. This is especially so when advertising CBD via major online platforms such as Google and Facebook.
Digital advertising offers an excellent opportunity for CBD brands to market their products or services. More specifically, programmatic advertising can help CBD brands explore digital opportunities to drive engagement and increase conversions. Here we look at everything you need to know about programmatic advertising for cannabis brands.
What is Programmatic Advertising?
Programmatic advertising involves using data collection and algorithms to automate the process of buying online advertising space.
In other words, programmatic advertising allows marketers to purchase ad impressions on publisher apps via a sophisticated ecosystem, including ad slots for voice and video ads, online, digital out-of-home (DOOH), TV, streaming, etc.
The automation helps streamline your digital advertising efforts in a single technology platform. This way, your transactions will be more efficient and effective. The best part is that you can programmatically access any channel and format, including desktop, mobile, audio, tablet, and digital outdoor.
Besides, programmatic advertising allows you to segment audiences using data to ensure that you’re targeting the right people with your ad and at the right time. More specifically, a programmatic advertising platform analyzes the following things to identify online consumers:
- Demographics (gender / age)
- Geographical location
- Time of day
- Devices (tablets, smartphones, laptops, desktops, etc.)
The idea is to get real-time data and then use it to identify the best online audience for the campaign. After that, a programmatic program purchases the ad campaign from what’s available across multiple devices in the ideal places for your audience.
Why Programmatic Advertising Matters?
Programmatic advertising is a powerful tool in the digital advertising world. Reports show that programmatic advertising contributed US$129 billion to the digital advertising market in 2020, up from US$45.72 in 2019. The global programmatic advertising spend is expected to surpass US$150 in 2021. If you are yet to start programmatic advertising for your cannabis brand, you are losing a lot.
Programmatic Advertising for CBD and Cannabis
Programmatic advertising is a real-time and promising marketing trend for the cannabis industry. As you might know, marketing cannabis and CBD on Facebook and Google (the two large digital advertising platforms) has many limitations.
Programmatic advertising offers an excellent way to reach any audience as many high-traffic sites like HuffPost, USA Today, ESPN, Newsweek, etc., allow programmatic cannabis ad purchases. There are many reasons why programmatic advertising is beneficial to CBD marketers, including:
Although cannabis laws are changing, cannabis advertisers are required to ensure that their ads only target adults 21 and over, even in legal states. Luckily, programmatic advertising will help CBD marketers target the legal age and ensure their ads are location compliant.
Ensuring that your cannabis ads are age compliant is just the beginning; you need to make sure that you target the right audience. Programmatic helps get access to related content areas and high-reach publications. Programmatic advertising can help expand your campaign reach beyond niche demographics to take advantage of changes in consumer behavior.
Unlike offline advertising solutions, programmatic has fewer regulatory issues. As such, it allows cannabis brands to display a high volume of ad impressions. It becomes easier to reach new audiences and stay on top of opportunities.
CBD and cannabis marketers need to use cannabis-specific ad buying platforms (we’ll look at some of these later in this article) for better results. For now, let’s look at tips for cannabis and CBD advertisers on programmatic platforms (DSPs).
7 Tips on Cannabis and CBD Programmatic Advertising
The main problem that cannabis brands face in marketing is identifying platforms that will accept cannabis ads. Luckily, programmatic advertising simplifies this problem.
However, when considering a programmatic campaign for cannabis products, you must make sure that you comply with all legal requirements.
Once you’re done with legal requirements, you’ll need to factor in business considerations. That said, here are tips to help have successful programmatic cannabis and CBD campaigns.
Don’t Ignore Local Cannabis Marketing Regulations
Before you consider a programmatic campaign for your cannabis products, you need to research the existing laws in your targeting markets. Although cannabis advertising laws vary from state to state, some things are common across states. As a rule of thumb, remember these things when developing your cannabis ad:
- Avoid claims that CBD or cannabis can cure any medical condition
- Don’t include elements that can appeal to children
- Include a ‘For Adult Use’ label on infused products
- Avoid making any false or misleading statements
- Don’t feature any testimonials or products endorsements in your ad
Understand Which Programmatic Channels Work Best for Cannabis
Since the Federal Communications Commission prohibits cannabis advertisements on TV commercials and radio, the overall scale and audience reach is minimal. Luckily, programmatic campaigns can help bridge the gap between mainstream publications and cannabis-focused publications.
To get the most out of programmatic cannabis ads, you need to choose channels that work best for cannabis products. The idea is to have a programmatic campaign compliant with local regulations and reach different subsets of cannabis consumers.
Focus Your Ad on CBD Rather than Traditional Cannabis
Unlike Tetrahydrocannabinol (THC), CBD is non-psychoactive. As such, it has fewer restrictions under federal law. Focusing your ad creative only on CBD products can help avoid many ad restrictions.
Focus on Your Brand, Not Your Product
With the many CBD brands competing for the available CBD market, focusing on what sets your brand apart is essential. Think about what people think about your brand, not products. What are your company values and attributes? Once you identify and focus on what makes your brand unique, you’ll weed out a lot of competition.
Define Your Programmatic Cannabis Goals
As with any other product, you need to set your CBD programmatic goals from the start. The best approach is to use available data to determine the level of advertising awareness you need. After this, develop an effective strategy to help achieve both short- and long-term goals.
Don’t Ignore the Human Touch
Although programmatic advertising relies on machines and algorithms, it is important to remember that you target humans with your ads. As such, you should remember to include the human touch in your programmatic campaigns.
Don’t rely on algorithms alone to get the most out of your campaigns—skilled marketers can help plan, control, and optimize your purchasing. The idea is to find the perfect match between automation and human intervention for optimum results.
Dissect Your Data
CBD advertisers can use data from the programmatic ads to analyze third-party information and determine the success of their advertising campaigns and potential return on investment (ROI). You can use the information in your data management platform to improve the customer experience.
Sites and Platforms that Accept CBD Advertisers
There are many programmatic advertising channels you can use to advertise your CBD brand. Each of these platforms has its pros and cons, meaning you have to be careful when selecting the best channel for your brand.
With the many CBD brands available today (and others being set up each day), it’s no doubt that CBD advertising is competitive. This means cannabis and CBD brands are always competing for the little available space to get their market share.
You’ll need to consider various factors when choosing the right advertising channel for you, including goals, budget, target audience, and site quality. That said, here are different programmatic advertising channels you can use for your CBD brand:
Display Ads for Cannabis and CBD
Display ads have been around for a long time and don’t seem to go away anytime soon. In fact, display ads are what comes to people’s minds when they hear about digital advertising.
Some of the things you need when running display ads for cannabis or CBD include:
- Your logo
- A high-resolution image
- A short headline
- Clear body copy
- A call to action (CTA) button
- Link to your landing page
That said, you’ll need design experience (or work with an agency) to put the above elements together when developing the ad concept.
The best thing about programmatic display ad campaigns is that it allows A/B testing of different ad sizes to choose the ones with the best conversions. That’s why we recommend developing more than one ad concept to ensure the ad inventory available to you isn’t limited. That way, you can focus more on the best-performing versions and focus less on versions with lower conversion rates.
Display ads for cannabis and CBD offer an excellent way to create brand awareness. Display ads will come in handy when launching a new brand or expanding traffic and demand for your existing brand.
Display ads can also help retarget people who’ve visited your CBD website. For instance, you can use a retargeting display ad to remind a potential customer who visited your website but later became distracted before completing their purchase.
The best part is that you can serve your customer with custom display ads that address specific segments of their buying journey. For instance, if a person visited a CBD oil page, you can target them with an ad about the specific product for better conversions.
To further increase your conversions, consider using display ads alongside other advertising campaigns.
Mobile Cannabis Ads
As with display ads, mobile ads are a crucial element of programmatic advertising. In the recent past, we’ve experienced a sharp rise in mobile traffic. Available research shows that an average person spends at least four hours a day on their mobile device. That means running mobile ads is a must for any serious cannabis brand.
Programmatic mobile campaigns allow cannabis brands to target their audience based on set mobile activity. For instance, you can target your ads to people using cannabis apps such as Leafly, Weedmaps, etc., or use mobile data to target adults in certain geographical locations in what is known as geofencing.
Since most consumers use both mobile and desktop, it’s important to use both types of display advertising to discover which one works best for your audience.
Connected TV Ads
Video is a powerful way to engage your audience and get your message across. It is estimated that Connected TV (CTV) households are set to grow by 82% by 2023. As the majority of viewers switch to CTV, it provides an excellent opportunity for CTV ads.
The benefits of CTV ads cannot be overstated. From increased audience engagement to visibility to establishing brand awareness, the list is endless.
CTV ads for cannabis brands still face some restrictions. However, you shouldn’t let this way you down. As more states continue to ease cannabis laws, more networks accept CBD and cannabis ads.
The best part is that, unlike broadcast TV ads that have stricter restrictions, cannabis and CBD advertisers can reach new customers via CTV streaming services, including Hulu, Roku, Apple TV, Sling TV, among others.
CTV allows CBD brands to show their ads to compliant audiences, unlike traditional TV ad inventory that remains closed to CBD and cannabis advertisers. As such, CTV ads offer a great opportunity for CBD brands to target a specific audience with compliant ad messaging.
Despite the growth, the cannabis industry still faces a lot of stigma. This is where native advertisements come into play.
Ideally, native ads blend into the content that surrounds them on the platforms that they appear. When you surround a cannabis ad with valuable non-cannabis content, it reduces the stigma around cannabis and CBD.
Running a successful native ad for cannabis and CBD isn’t complicated—you need an ad copy, a high-resolution image, and a click-through link. The best part is that cannabis advertisers can run native ads on mainstream websites because the surrounding content helps reduce the stigma around cannabis and CBD.
Digital Audio Cannabis and CBD Ads
Since traditional radio ads don’t accommodate cannabis and CBD brands, digital audio ads offer the much-needed solution to these restrictions. Digital audio ads allow the buying of cannabis and CBD ads through programmatic advertising platforms.
As with other programmatic ads, buying digital audio ads come with many benefits, including data-based audience targeting. With digital audio ads, you can use audio music to target cannabis audiences on streaming radio and music platforms such as Pandora, Spotify, iHeartRadio, among others.
An average US adult will spend more time listening to digital audio than traditional radio. That means digital audio is popular among younger cannabis and CBD consumers as well. This makes it a programmatic ad format to watch in the growing programmatic landscape.
If you plan to try audio advertising, it’s advisable to develop the digital audio data the right way. When done right, digital audio offers an excellent opportunity to reach a larger audience, improve engagements, and stand out from the competition.
As you can see, programmatic advertising provides an excellent opportunity to market cannabis and CBD. Key programmatic advertising channels such as connected TV digital audio, mobile, and display ads allow compliant cannabis and CBD ads. It’s best to involve a professional who understands programmatic marketing for cannabis and CBD to get the most out of your digital campaigns. Ready to give it a try? Talk to us today, and we’ll help you get started.