With eight states having legalized recreational marijuana, new businesses are multiplying. One ad person even asked if there could be “a Starbucks equivalent in the world of weed.”
So today, let’s see the possibilities.
A Starbucks Equivalent
Surface Magazine shared five ad firms’ marijuana marketing ideas, All suggested aspirational branding that could move small businesses beyond the local level.
Saatchi & Saatchi proposed Botanica, a marijuana infused tea.
Base Design thought a marijuana mood modifier called Okay could make cannabis a normal part of everyday life.
A third possibility was Water Water from Omnivore. The idea here was a low calorie addition to the alcohol category.
L’Enfer Est Volontaire, proposed by Karlssonwilker, had the chips approach…but not quite what you would expect. The bag would have artisanal chips and waft weed smoke.
More traditional, the fifth idea was Hi by MGMT. They thought a brand could embody an assortment of “artisanal classic munchies” sent to people monthly.
Meanwhile, in California, January 1st is the big day.
With recreational legalization here, specialization is the trend. Outsourcing, one firm might no longer clone, harvest and deliver. Developers are creating apps, sensors and technology. Especially thinking of California’s recent wild fires, businesses want crop insurance. For large hauls, they need security.
On the demand side we have new products ranging from hemp-based plastics to edibles that target senior citizens. Because marijuana remains federally illegal, local firms are emerging to provide financial services. They need the basics like bank accounts, loans and venture capital funding.
Our Bottom Line: Markets
As economists we can say that the marijuana narrative is about new markets. It is about the new product and factor markets through which price and quantity will be determined.
Simplifying countless markets, a circular flow model displays business activity. In the outer loop, dollars are circulating between households and businesses. Meanwhile, the inner loop shows the goods and services, and the land, labor and capital that the dollars buy.
In California marijuana markets, the circular flow is accelerating: