We're still waiting to see which company will become the Grey Goose of marijuana.
Right now, there isn't a whole lot of brand awareness about specific cannabis companies. But with marijuana legalization on the rise, that could all change within the next decade.
Drake Sutton-Shearer — the CEO of PRØHBTD Media, a company that creates and markets cannabis brands — joined us to talk about the marketing behind it all. He discussed how quality brands will start emerging, Wall Street's valuation of the industry, and why he wants to change the "stoner" stereotypes surrounding the product. Below is an edited transcript of the interview.
Drake Sutton-Shearer: It's a war of brands that's coming up in the future, and I really think now you've got a lot of aspirational brands, a lot of design, logos, experiences. I mean, this is really an experiential product. In some ways, a lot more than alcohol because it has real medicinal health and wellness properties. And look, there's more than 60,000 cannabis companies in North America alone, so there's a lot of competition to build mind share with audiences.
David Brancaccio: I was just thinking about comparisons to the alcoholic spirits industry. Without branding, that's all just moonshine — ethanol and water. But over the years, people have developed passions about Grey Goose versus Absolut. In the cannabis field, those really haven't gelled yet. Right? What's the top brand in cannabis? You can't answer that.
Drake Sutton-Shearer: Over the next five to 10 years, we're going to really see an emergence of quality brands. In my opinion, I don't think that we've seen the future — big brands have yet to be created. I'm sure that private equity or the large CPG [consumer packaged goods] portfolio companies will come along and buy brands. But they'll look to buy at scale, so we're just a long way away from that.
Brancaccio: You've talked to, for instance, Wall Street types about some of this?
Sutton-Shearer: People are definitely looking at the space and tracking the space. Categorically, it's looking to be a $100 billion-plus industry. Tobacco is $100 billion. Alcohol is a couple of hundred billion. With Constellation Brands, who owns the Corona brand, recently invested a couple of hundred million into Canopy Growth in Canada — the No. 1 cannabis producer. It's safe to say that alcohol and cannabis will be mixing very soon, coming to a store near you. I think that in the cannabis industry, we'll start to siphon some of that value from alcohol over to cannabis.
Brancaccio: Big money clearly lying in the wings. But if this goes beyond the two core constituencies, cannabis to help with chronic pain and those who see themselves as stoners — I mean, it needs to go beyond that.
Sutton-Shearer: Well, sure. I mean, look: It's been about stoner culture for years, but let's be honest here, that's just a stereotype. It's a stigma that's attached, and part of what we do as a company has helped to change that narrative. Less than 10 percent of the audience interested in cannabis is waking and baking, as it were. So the balance are very interested in health and wellness. They're very interested in learning. They're curious, right? Cannabis is a great substitute for alcohol and for opioids and other things.
Brancaccio: I mean, what does complicate this, right, is that the federal government still prohibits national advertising in this regard. You also have an attorney general, Jeff Sessions, who seems against the liberalization on a nationwide scale. It makes it hard to develop a national strategy at this point.
Sutton-Shearer: Sure. I mean, look, it's a very complex and challenging industry. It's really on a state-by-state basis. You've got some companies who are building brand equity in states and looking to export their IP to other states and internationally. And that's going to take some time, but companies like ourselves, we've had to build our own ecosystem. We've had to build our own media platform, and we see about 20 million video views a month right now with that content, which allows us to help cannabis brands be seen and be heard. But it took time to do that, because you can't just take a media budget and apply it to Facebook or Google and say, "Hey, you know we want to promote these cannabis brands." It just doesn't happen today. But we're hoping that changes in the future.
Brancaccio: For people who haven't checked out the PRØHBTD Media website, it does weed-themed shows, among other things.
Sutton-Shearer: Yeah. I mean, at prohbtd.com, which is a consumer-facing site, we have a lot of cannabis-thematic content and lifestyle content, fashion content, street culture. It's a very youth-orientated site. And some of it is all about weed, and other content is all about learning. There's also a docu-series style and lifestyle content as well, because what we found after looking at 36,000 hours of viewing time last year — we connected with the Wharton business school and we parsed the data and looked at it — and conclusively, we found that people really are discovering cannabis through culture, not really through the cannabis lifestyle. They want to discover brands through music and entertainment — things like that.
Brancaccio: First it seems weird — prohbtd.com. But when you think about it, right, car guys like me would watch a car channel and consume just about everything we can about cars. And if you have some interest in cannabis, I guess you could come up with this portfolio of content that would interest people like that.
Sutton-Shearer: Sure. I mean, look, people want to look at fashion, they want to look at cannabis, they want to look at food. But the thing is, if you start with cannabis, you're gonna lose your audience, so you really have to start with things they're interested in, such as food, right? Or music or whatever it may be, and then integrate cannabis into that conversation.
“I think the best compliment I can give is not to say how much your programs have taught me (a ton), but how much Marketplace has motivated me to go out and teach myself.” – Michael in Arlington, VABEFORE YOU GO