Entrepreneurs in the world of pot face a double-edged sword. As new legal markets open, consumers rush to buy products they couldn’t before and the first companies to enter those markets and establish their brands can see strong sales. At the same time, restrictions posed by business partners can hamper marketing activities, even on those companies that don’t “touch the plant.” Graham Gibson, CEO of KandyPens, attests to that first hand. He sells vaporizers for medical marijuana patients and recreational users but can barely say so.
When he brought his idea to the crowd-funding website Indiegogo to find capital, the response was wonderful according to Gibson. “I saw the need for a high quality vaporizer that came with a warranty, great customer service and a lower price than what was out there,” he said. The campaign quickly netted him sixty thousand dollars in cash, one hundred and fifty thousand dollars’ worth of wholesale orders, and even an offer to buy the company (which he declined.) “The interest in cannabis-related products is enormous,” said Gibson.
That interest also translates to high returns on advertising investment, provided the right vehicles are used said Gibson. While magazine ads and YouTube commercials did not work well, ”We spend $50,000 to $80,000 per month on advertising and get a 600%-800% return which is fantastic,” he said. Advertising vehicles include the High Times website and product placement in music videos.
– Read the entire article at Forbes.