Pubdate: Tue, 11 Apr 2017
Source: Ottawa Citizen (CN ON)
Copyright: 2017 Postmedia Network Inc.
Contact:  http://www.ottawacitizen.com/
Details: http://www.mapinc.org/media/326
Author: Jacquie Miller
Page: A12

CANNABIS REGULATIONS MIGHT BLUNT SNOOP DOGG'S BRAND

The elegant white box shipped from the Tweed Inc. medical marijuana
plant in Smiths Falls is stamped with a gold cannabis leaf that
signals the dried bud inside is endorsed by Snoop Dogg himself.

The rapper who once boasted of smoking 80 blunts a day has a
partnership with Tweed that helps both parties: Snoop promotes his
Leafs by Snoop cannabis line and Tweed benefits from an association
with "the world's most renowned cannabis connoisseur," as Tweed
describes Snoop.

Tweed is poised to jump into the recreational market, and the
marketing deal with Snoop Dogg was a major coup.

But with the federal government poised to legalize recreational pot,
there is a big question mark around the issue of advertising and
promotion as marijuana emerges from nearly a century of
prohibition.

Will customers in Canada's world of legal pot be scooping up Leafs by
Snoop, or perusing plain packages packed with health warnings? Some
clues might be revealed this week, with speculation the federal
government will introduce its long-promised legislation to legalize
marijuana. The legislation is expected to provide a framework, with
many of the regulatory details worked out over the next year or more
with the provinces and municipalities.

The federal task force of experts studying legalization recommends
restrictions similar to those on tobacco: a ban on advertising,
promotion, endorsements, branding and sponsorship of cannabis and
accessories. The report also calls for plain packaging that provides
only basic information, such as the company name, strain, price, and
amounts of THC, the chemical component that causes users to get high,
and CBD, another chemical component.

That would rule out celebrity endorsements and attractively designed
packages such as the ones encasing Snoop Dogg's "Ocean View" and
"Sunset" medical marijuana.

The task force said it listened to the concerns of health-care
professionals, municipalities, police, youth experts, parents and
educators who said advertising restrictions are needed to counter
efforts by the marijuana industry to promote consumption.

"As with other industries, this new cannabis industry will seek to
increase its profits and expand its market," warns the report. Canada
should learn from experiences with tobacco and alcohol, since
promotion increases consumption of those products, it said.

The Canadian Medical Association suggests not only plain packages, but
inserts inside to warn consumers about the health risks, the need to
keep products away from children, and not to drive or work with
hazardous chemicals or equipment after using marijuana.

The task force does recommend loosening restrictions slightly to allow
"limited" promotion, as well as information about products inside
stores if cannabis is sold in outlets not accessible to minors.

Medical marijuana producers poised to jump into the recreational
market are concerned. Half a dozen of them, including Tweed, sent a
letter recently to federal politicians saying they support limits on
advertising but companies should be allowed to brand their products.

Brands are vital to help educate consumers and lure customers away
from the black market, they argue. There are thousands of strains of
cannabis, and hundreds of products, says Brendan Kennedy, chief
executive of Tilray, a marijuana producer in B.C.

Branding also helps companies build loyalty and promote their
differences. In a sea of plain packages, companies would end up
competing for customers based on "price and potency," Kennedy said. It
would be a "race to the bottom," with the winner offering the
lowest-price product with the highest amount of THC.

Brands also allow companies to express their values, says Alexander
Close, a partner in Tantalus Labs, a company promoting environmentally
sustainable cannabis growing that has built a huge greenhouse near
Vancouver. Close says the greenhouse is the first of its kind, and
uses about 90 per cent less electricity than indoor grow-ops.

"If a company creates a high-quality product, they want to be known
for it," he says.

Even a picture on a package - a sun, for instance - helps to convey
information, he says.

Trust and loyalty from good production practices only matter when
products can be distinguished on a shelf, Close says.

Ray Gracewood, CEO of OrganiGram, says he can't imagine the government
will impose marketing restrictions for recreational marijuana that are
stricter than those now in place for medical marijuana. Medical
marijuana companies are not allowed to advertise or promote their
products, although that doesn't extend to celebrity partnerships and
attractively designed packages.

OrganiGram, which hopes to expand into the recreational market, has a
partnership with the Trailer Park Boys, the trio of losers from the
satirical TV series. There are no Buds by Bubbles for sale yet, though
- - that licensing deal is contingent on what happens with regulations
on recreational pot.

But when recreational pot is legal, OrganiGram hopes to "leverage the
Trailer Park Boys brand equity to bring to market a product that is
specific to their target demographic," Gracewood said.

The demographic would be mainly guys in their mid-20s to mid-30s.
Don't call them potheads, though. In marketing lingo they are
"experienced users within the cannabis space."

Gracewood says he supports advertising restrictions as well as the
cautious approach displayed by the federal government toward the
"complicated, momentous project" of becoming the first G7 country to
legalize pot. However, he says plain packaging would unfairly
associate cannabis with tobacco.

"That only helps reinforce the stigma that cannabis currently has. ...
Any steps they take to make consumers think about cannabis the same
way they think about tobacco is doing the industry a disservice.

"One of our high-level goals is to eliminate the stigma of cannabis to
the general public. And allowing brands to exist within the space
allows the industry to become relatively normalized, and removes that
negative stigma."

That goal, though, is not necessarily aligned with the intent of
federal politicians, who have promised to "strictly regulate"
cannabis, not promote its use, favour a "public health approach" and
guard against "commercialization" of pot.

There is a contradiction of competing interests, says Chris Damas, a
stock analyst who researches the cannabis industry.

"The government has said, 'We're going to err on the side of public
health.' But obviously the stockholders and the insiders and the
(medical marijuana producers) - and if they are publicly traded, the
investors as well - have much more of a motivation to make some money,
so branding and advertising is key."
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MAP posted-by: Matt