The Only Way to Succeed in Today’s Cannabis Business Environment

I’ve had a long career that’s spanned companies and industries, including agriculture, food processing and CPG. The legal cannabis space, however, is the biggest and most exciting challenge of my career.

Until recently, I saw my job as taking the lessons I learned over the past 25 years in industries characterized by commoditization, consolidation, and an insatiable drive for efficiency and applying them to cannabis. Certainly, there’s validity in that approach. After all, cannabis is an agricultural product that, like all agricultural products, will experience market corrections that determine winners and losers based on the ability to produce high-quality products with the lowest cost structure. All in my wheelhouse. With that said, I’ve recently concluded that the challenge and needs are much greater (and more interesting) than that.

Here are three things you need to succeed in today’s cannabis business environment:

1. Build and retain an amazing team.
How do you do that? Create an environment that attracts the right kind of people and allows them to flourish by freeing them up to do the things they are truly passionate about.

2. Continually create high-impact products at scale.
The qualifier “at scale” is the fly in the ointment here. In a large organization, creating this type of environment is a monumental challenge. Why? Because scale requires process. In a nutshell, process is the science of breaking down tasks into repeatable steps, supported by data and systems. The entire cannabis industry is being indoctrinated by process right now. As a company grows, however, process can become suffocating and control can prevail at the expense of entrepreneurial spirit and, ultimately, innovation. So…

3. Constantly evaluate your ability to truly innovate.
Incremental improvement is not innovation. In fact, it’s the exact opposite. True innovation requires us to think about something in a completely different way. Innovation, along with a strong pipeline of new products, is critical to creating loyal customers.

At Natura, Ori and I are focused on implementing all of this. We’re attracting high-impact leaders who can build new products and businesses. My job is to build an environment that provides our leaders with the freedom to flourish and supports them with the process they need to scale and innovate. How fun is that?

 

Craig Powell, COO

My 4:20 flight to cannabis marketing

“Now boarding group 1, for the 4:20 flight to Denver.” Yes, the flight that has taken me home from my new gig most weekends since the beginning of March departs at exactly 4:20. You simply can’t make this stuff up.

There have been a lot of things I could say that about since first stepping into cannabis just two years ago. From the reactions of friends and family, to my first failed venture, to a role I could have never foreseen, and all the crazy antics in between, it’s been a wild ride – one I almost got off of just 5 months ago, due to just how tumultuous it can be.

Cannabis is unlike any category I’ve ever experienced. And I’ve had the good fortune of working in more categories than I can count. From booze to baby food, QSR, retail, CPG, OTC, and the hardest of hard-core pharmaceuticals – been there, done all of that. Looking back, it seems like the variety of clients and categories I served was all in preparation for this moment. Who knew? But I’ve learned that no matter how many years of experience you have outside of cannabis, you had better be ready to adjust to what’s happening inside of it.

This is a very diverse group of makers. Entrepreneurs from all walks of life. One minute, you’ll be talking to the now legitimate business owner who spent many years growing and selling illegally, maybe since he or she was a teenager. Five minutes later, you are meeting with a former or current finance executive who has a passion for the plant and the cash register, who knows just enough to be dangerous about cannabis, the supply chain, and the nuances of cannabis marketing.

A few words of advice to fellow marketers: If you are expecting your tried and true processes from the CPG marketing and advertising world to automatically revolutionize things, you had better take a deep breath.

 

1. Know the category
Sounds easy, right? Not so fast. This is on a state by state, city by city, neighborhood by neighborhood basis. Make no assumptions, take no prisoners when it comes to doing your homework on everything from consumer, to retail, to regulatory challenges. Be prepared to dig deep on data and get creative on how you arrive at your strategic recommendations. 

2. Know your client
Don’t expect the org chart for your cannabis client to look like that of Nestle. It doesn’t matter how much money the press releases say they have. They have a lot going on, and a million challenges to solve for. They need Swiss Army knife agencies, who can help them launch, scale, and grow – without bleeding them dry.

3. KNOW your client
That’s not a typo. Never, ever will you work with people more passionate and directly connected to their brands. Their brands are literal extensions of themselves. It’s what they think about before they fall asleep, and when they wake up, and most moments in between. You will spend a lot of time with the CEO. Do not bring your ego.

 

Oh, but do bring a new pair of running shoes. This is a race. Good, fast, and cheap is definitely on the table – because the margin game for every single one of these brands, no matter how successful, is really tough.

I was ready to get out of cannabis after my first venture. In fact, I went to my interview at Natura thinking it would further confirm that I should leave. Then I met people I felt I could trust, doing something I could believe in, offering an opportunity where I could make a difference. 

Since joining Natura, I’ve learned that this category needs investors with more than just money. It needs people who want to invest in maximizing the potential of cannabis from every angle. The payout will not be immediate. This space is exhilaratingly hard. Defined and yet so undefined. I liken it to an amusement park for marketers. You will be laughing and screaming at the same time. You will also get to do things you would never get to do anywhere else.

I’m on my last UA flight 2178, departing at 4:20, before we pack up our old home in Denver to drive to our new home in Sacramento. We plan to stop at some amazing places along the way, on our way to my next amazing stop on this crazy cannabis ride.

 

Dana Callow, CMO