Every day brings new questions about the legality of marijuana in different states — the drug remains a schedule 1 substance at the federal level, but 11 states have made weed fully legal, and another 22 allow it for medical usage. So it figures that, with the legal status of cannabis in flux, the regulations regarding cannabis advertising change all the time.

It can be difficult to stay up to date on regulations, especially for boutique dispensaries just getting into the business that want to spread the word about their product but aren’t sure how to get started or where to even look for guidelines.

We have you covered. We’ve put together this guide on marijuana advertising laws, which we’ll update regularly to ensure you have the latest information. Still have questions? You always can contact us to ask.

Who Determines What’s Legal for Marijuana Marketing?
State regulators generally determine laws regarding cannabis advertising. However, not every state has set up such laws. The rate of legalization is outpacing many states’ preparedness — they may not have addressed any questions of advertising legality, which means policies will be set via individual case precedent.

For instance, after a billboard in Maryland depicted Michelangelo’s Adam smoking a jay, state legislators enacted new standards for pot advertising. Up until then, it was relatively unregulated.

What Regulations Have States Placed on Marijuana Advertising?
Many states model their marijuana advertising laws after already-existing ones governing alcohol advertising. One major consideration is exposing kids to advertisements for controlled substances, including marijuana.

When Colorado became the first state to legalize marijuana for recreational usage in 2014, the state stuck with a guideline the alcohol industry has used for self-governing — no advertising on television programs, radio stations, websites or print publications where the audience includes more than 30 percent of people under age 21.

What Happens to Advertising That Can Be Viewed Across State Lines?
This is an area the states are still working through. It’s complicated.

Since marijuana is banned at the federal level, you won’t see any national advertising for the substance — i.e., you can’t take out an ad in a national sports publication for cannabis because it would probably get the magazine into a mess with federal regulators.

Other regulations vary according to what states the ads will be seen in. You can buy an ad for a dispensary in many magazines that only target Colorado readers. But you can’t buy one in a magazine that will be distributed across state lines. Colorado law explicitly states cannabis sellers cannot target people out of state.

How about advertising in a state that has not legalized marijuana for a dispensary located in a state where marijuana is legal? This, again, is tricky and will likely come down to a court challenge some day.

A controversial billboard in Connecticut, where recreational pot use is illegal, reminded travelers that in nearby Massachusetts, they can use it legally. Groups protested the billboard, but it wasn’t removed. Some state legislatures are putting such items on their agendas for future sessions — so you can be sure there lobbying dollars will flow there.

Safety Claims Closely Monitored
Whatever type of cannabis advertising you engage in, from online to billboard, there is one regulation that remains consistent no matter what state you choose to advertise in, and that’s regarding safety.

You cannot make false claims about your product’s safety. You cannot imply the product does things it can’t deliver. You cannot mislead people about the effects of marijuana. Every state monitors for these things, and violating such guidelines could lead to fines or being blacklisted by a media company.

Other safety-based regulations in advertising:
 

• No promoting “over consumption” of marijuana
• No claiming unproven curative effects of the drug
• In some states, posting advertising without a list of possible side effects (i.e., may be habit-forming), much like with tobacco advertising

Will Every Media Property Accept Marijuana Advertising?
No. TV stations, magazines, newspapers, websites and billboard vendors can decide whether they want to accept cannabis advertising dollars.

Rejecting them has not, so far, been proven to violate free speech or any other regulations. So if you try to advertise with a brand whose audience doesn’t quite line up with your target, don’t be surprised to receive a rejection. (The NFL famously refused a cannabis ad for the Super Bowl; the league has strict policies regarding player marijuana usage.)

Individual State Laws for Cannabis Marketing
Colorado, California and Washington are three of the most prolific states to legalize marijuana, and all have posted rules governing its advertising. Here’s the rundown on their current rules, but make sure to check back often, as regulations evolve quickly within new sectors like pot advertising.

What Are Colorado’s Pot Advertising Restrictions?
Since Colorado was first to legalize pot, it remains ground zero for the industry. Many things that happen in Colorado wind up imitated in other states. The Marijuana Enforcement Division of Law Enforcement enacted some strict limitations on advertising, including:

• No outdoor signage of any kind
• No mobile or otherwise location-based advertising
• No unsolicited internet pop-up ads
• No banners on mass-market websites
• No unsolicited leaflets or handbills

What Are California’s Laws Governing Cannabis Advertising?
California has the largest economy of any state where cannabis has been legalized. It’s attracting a big share of the advertising dollars in the sector, so you should understand the guidelines governing weed marketing in the state. Here’s a rundown on regulations in California, which went into effect in January 2019:

TV, digital, print and radio ads for marijuana can only run if at least 71.6 percent of the audience is over 21

Cannabis advertisers cannot include imagery that would attract minors, such as movie or cartoon characters (in other words, SpongeBob can’t be your celebrity spokesperson)

No giving away freebies or promoting contests tied to cannabis

Billboards on highways cannot be closer than 15 miles to the border or 15 miles to another state (this is designed to avoid the aforementioned type of controversy seen between Connecticut and Massachusetts)

What Are Washington’s Marijuana Advertising Laws?
The Washington State Liquor and Cannabis Board has a comprehensive listing of what’s OK and what’s not in marijuana advertising:

Hiring agencies to promote videos and using search options like Google Ads is permitted

• No advertising on public transit or in shelters
• No advertising on publicly owned property or within 1,000 feet of places frequented by those under 21, such as schools or playgrounds
• No sign spinners, costumed provocateurs or other people advertising on the streets to bring attention to a business; no inflatable tubes, either
• No wrapped vehicles
• Direct mail is OK as long as you don’t include coupons
• Billboards are allowed, though they cannot use certain words or imagery, such as leaf or joint

Keep Up With the Latest on Cannabis Advertising
Marijuana regulations governing cannabis marketing will change and evolve as the marketplace grows and more states approve it for recreational usage. Stay informed by checking back with us periodically for the latest updates.

Appeared in Advertising Week 360

Cannabis billboards. You’ve probably seen a few of them now, driving around California or one of the other nine states where recreational marijuana use is legal. And if you haven’t seen them yet, you will. Billboards advertising marijuana are about to become all the rage, but if you don’t navigate these waters carefully, your company can get in trouble.

Cannabis advertising has proven tricky across other media. Putting an ad in a national publication or buying national TV time, for instance, can put an advertisement for cannabis in states where it’s still illegal, a major no-no. Billboards, by contrast, make an excellent delivery point. They’re localized to one area, enjoy relatively low regulatory oversight, and also deliver a lower CPM than other forms of media.

Media analysts see huge potential in this market. Mark Boidman, managing director and head of media services at PJ SOLOMON, has projected total ad spending on cannabis advertising will soar from $825 million this year to $3 billion by 2025, and out of home is expected to capture 10 percent of that.

Advertising something that’s still illegal at the federal level calls for careful rule following, so keep these dos and don’ts in mind as you decide your goals and come up with your vision.

DO: Check Out Local Regulations Before Making a Buy

Like marijuana legalization itself, guidelines vary greatly between states and municipalities. What’s legal in one space may not be OK right across the street. Your agency should thoroughly investigate the regulations governing cannabis advertising. Some restrictions you may run into include:

•         No cannabis ads in areas where most of your audience is likely to be under 21, such as close to a school.
•         Your license or permit number may need to be displayed on the sign, to distinguish you as a legal dispensary or cannabis information clearinghouse. California’s laws, for instance, include this requirement.
•         You usually cannot advertise if your license is suspended — another rule you’ll find in California.

DON’T: Show People Smoking or Other Controversial Images

Many people subscribe to the theory that controversy can sustain a brand, believing the more attention you get, good or bad, the better off your business is. But since cannabis is such a controversial topic to begin with, you don’t have to push the envelope any further. In fact, the more conservative you play it, the more effective your ad may be.

You want to come across as a serious business. Showing someone smoking doesn’t put you in that space. Focus on your message rather than shock value, and your billboard will resonate with more people.

TL; DR: Don’t court controversy just to do it because it could hurt the industry in the long run. This is an emerging field, and as time goes on, people will become more tolerant of more outrageous messages. But not yet.

DO: Be Witty with Your Message

Now, “conservative” doesn’t have to mean “boring.” You are a marijuana company, after all, and your distinctive personality will make you stand out. Focus on what sets you apart, and pound on that with smart copy and creative.

In some areas, dispensaries have become ubiquitous. Give people a reason to use your store, site or services specifically. What makes you special? It might be:

•         Selection
•         Quality
•         Staff knowledge

DON’T: Make Claims You Can’t Back Up

Most states have strict laws about false advertising. Marijuana can fall into murky area, though, because it’s such a new science. Especially in states where it has become legal for medical but not recreational usage, you may be tempted to play up the herb’s medicinal powers.

Make sure you don’t go too far. Some states, such as Massachusetts, explicitly ban any claims related to therapeutic or curative impact of marijuana. The Bay State also won’t allow the promotion of giveaways on cannabis-related billboards. Again, we can’t emphasize this enough — always double check local regulations before you move forward with your board.

DO: Consider Your Branding

Especially in these early stages of cannabis commercialization, dispensaries and clearinghouses need to give people a reason to choose them over someone else. This is the perfect time for you to decide what your company is about and what you want to be known for.

Then practice simple rules of branding to emphasize these qualities across platforms. You will want to:

•         Use the same color palate across all billboards
•         Include your logo to get people familiar with it
•         Employ consistent language and messaging across your boards

DON’T: Use Any Visuals That Look Like They’re Trying to Appeal to Kids

One area of high sensitivity for cannabis advertising is anything that looks like it’s overtly or covertly trying to appeal to kids. Don’t employ cute cartoon animals or really young models. Focus on attracting adults and aim well over 21 to be on the safe side.

DO: Keep Evolving Your Messages and Your Delivery

The legalized cannabis industry is in its infancy, and regulations change quickly. There will be a lot of evolution in this area, and today’s dos and don’ts may evolve. Staying informed and making changes when you need them is the only way to ensure your company stays current and reaches the greatest number of potential customers.

LA’s DASH TWO, a boutique agency operating at the intersection of digital and OOH ads, has won its first OBIE Award, for its distinctive work on a Beatles’ retrospective campaign. This is the agency’s first nomination for the nearly 80 year-old honor recognizing the advertising world’s strongest players. DASH TWO claimed the silver, facing stiff, established competition.

Winners were feted earlier this week (May 21) in Las Vegas.

“We’re thrilled to have our first nomination result in an award,” says founder and CEO Gino Sesto. “This industry recognition for the kind of creative work we do every day means a lot to our team.”

The winning installation (video here) featured two different sets of content on a large LA-area billboard. The content changed according to the time of day, from a bold, simple announcement of the Universal Music release, to a nighttime display of iconic Beatles portraits. The shifting imagery reflected the overall messaging in the campaign in an intriguing, unexpected visual way.

(More on the OBIE winners here)

“OOH has always been known as one of the most exciting and challenging advertising mediums for design and creativity,” said OAAA Chief Marketing Officer Stephen Freitas. “For many creatives, winning an award for OOH design is a true career milestone, and we’re excited to honor those deserving of a coveted OBIE Award.”

There were 134 finalists for this year’s OBIEs.
 

About DASH TWO
DASH TWO is a media buying agency based in Los Angeles, delivering expert solutions for the music and entertainment industries. DASH TWO specializes in online and outdoor physical spaces, usually connecting the two, with campaigns including social media ads, PPC help, video creation and outdoor campaigns utilizing billboards, bus benches and wild postings in high-traffic areas.

About the OBIE Awards
The OBIE Awards are one of the oldest and most prestigious honors for creative excellence in advertising. The OBIE name is derived from the ancient Egyptian Obelisk, a tall stone structure that was used to publicize laws and treaties thousands of years ago. Many historians consider the obelisk as the first true form of advertising.

Sometimes a simple idea is enough to express an emotion or message. In fact, sometimes a simple idea can be worth an OBIE Award. These winning campaigns need no explanation, and that’s exactly why they are OBIE Award winners.

Appeared in Outdoor Advertising Association of America

When Netflix bought about three dozen billboards on the Sunset Strip last summer, people took notice. Netflix is known as an innovator, a ground-shaker. When it makes a move, especially one people didn’t anticipate, everyone watches.

Turns out Netflix was, as usual, a harbinger of things to come. Over the past year, at a time when so many businesses have beaten a retreat from traditional advertising such as TV and newspapers, tech companies are running in the other direction, toward one particular traditional medium — billboards.

Why? Well, the short answer is because it’s effective, but duh…anytime an influx of spending comes in, it’s pretty clear that medium is effective.

The longer answer is that tech companies approach advertising differently than other businesses. They aren’t blinded by bells and whistles. They’re thrilled by data and results. They’re thrilled by innovation. They’re thrilled by creativity. And out of home (OOH) advertising has all three.  

Let’s Do the Numbers: Tech Spending on Billboards in 2018

So before we dive into the “why” behind the tech companies’ devotion to billboards, let’s examine the “what.”

OOH advertising ended 2018 on a tear by any standards, but especially using the ones we’ve become used to judging traditional media by. These days, finishing even to the previous year is like finishing 5 percent up during the early 2000s.

OOH closed fourth quarter with an astonishing 7.2 percent rise in spending vs. the same period in 2017, according to OAAA. That made it the best quarterly gain since before 2008, when the Great Recession hit. Some other highlights:

• Apple was the top-spending advertiser in OOH  in 2018, the sixth straight year it has ranked in the top two. Netflix and Google finished in the top 10. Amazon and Facebook made the top 15.
• A quarter of all top 100 advertisers were from the technology sector, with Facebook and Oculus both more than doubling the previous year’s investment in OOH.

Speaking of spending, Netflix is now a billboard owner, but it’s keeping all the inventory for itself. You won’t see the streaming company leasing space to a nearby fast food restaurant. It knows the value of that real estate and has kept a steady rotation of advertisements for its latest shows coming through. (And with Netflix forecast to spend $15 billion on content this year, it could run a fresh ad every week and never repeat.)

So clearly tech companies are on board with boards. Now let’s look at the “why.”

OOH Data: Compelling Evidence Supports Billboards’ Results

Big data has been the cool thing in all spheres of advertising for years now. There’s a reason for that — it works. When you use big data to analyze, say, when people who like chocolate milk will be shopping, you can hit them up with a chocolate milk billboard at the moment they make their decision. It’s much more likely your campaign will be convincing if you know that kind of stuff about your target audience.

And OOH has proven adept at relying on this research. Right place, right time ads make a difference. Consider these OOH advertising facts:

• OOH is 382 percent more effective at sending people online to learn about an advertiser than TV
• OOH generates $5.97 in spending for every $1 an advertiser drops
• 55 percent of people who’ve seen a billboard say they were “highly engaged” by its message

Innovation: Ditching Inaction and Embracing Impulse

Tech companies are driven by results. Most began as startups and haven’t had decades and decades to get settled into staid patterns of thinking. They are more nimble and flexible than older companies in more traditional spaces.

Lots of tech companies engage in “design thinking,” which emphasizes action over endless focus groups and actually engaging with customers. Digital billboards fit perfectly with this mentality.

Digital OOH offers ways to act immediately on new ideas. You just email your creative to the vendor, and boom! You can have a new billboard up in moments. 

Design thinking encourages flexibility and versatility, which is another area where billboards (especially digital) shine. Current creative not doing it for you? Swap in something else. You can experiment as you go along and see what’s most effective. Netflix has a great opportunity to do this with its billboard buy.

Creativity: Using Old Media in New Ways

If you want to see innovation in advertising creative, you really need to look at OOH. Yeah, we’re biased, we’re an OOH agency. But really — the stuff people are doing is cool, and it’s getting talked about.

Tech companies like generating buzz. They like being seen as innovative. So while billboards are old media, they’re not without flexibility. And that’s exciting to these brands. Here are a few examples of out-of-the box campaigns they’ve run in recent years:

• Microsoft posted a billboard that disappeared and reappeared through a shadow effect
• Apple took over the side of a building in Vegas to spoof the “What happens in Vegas, stays in Vegas” trop before CES in early 2019, gaining loads of attention
• A billboard for Google Play streams music based on what’s going on around the board; so, for instance, it might play soothing classical music when there are traffic jams on the highway

These are the types of campaigns that get people talking on social media. They not only raise awareness of product, they also give the companies buzz. And in tech, buzz is currency. Consumers want to know tech companies are on the cutting edge in everything they do.

We’ll likely see more tech companies join the stampede of OOH advertisers over the next few years. It’s fun to see what they come up with without the type of boundaries that often seem to curtail the creativity of more traditional, formal companies. 

Appeared in MarTech Advisor

KPIs, or key performance indicators, are data points that help you track progress towards business goals and identify areas for improvement in performance. KPIs can relate to the business as a whole or to specific operational concerns, such as sales and marketing.

For digital advertising, KPIs typically relate to the cost and effectiveness of digital ad campaigns, or to specific customer or prospect behavior—for example, how long it takes on average for your qualified leads to convert into a paying customer, or how many retargeted ad views it takes before a prospect clicks the ad and visits your site.

Why KPIs Are So Useful to Your Business and Its Marketing

KPIs are important for a number of reasons.

First and foremost, accurate and up-to-date information about marketing and advertising efforts lead to better decisions. Things move quickly in digital advertising, and it’s important to be able to try things quickly when necessary, in order to remain agile and responsive to market changes. Armed with current data and information about the performance of your current ad campaign, you can shift more money and effort into the tactics that are producing the best results and away from underperforming contexts.

Secondly, the things that you measure on a consistent basis tend to get more of your time and attention. This ultimately leads to better results as well.

Finally, tracking KPIs in your digital advertising program helps you replicate successes in the future while simultaneously avoiding past failures. Data points that illuminate the specific steps taken in past successful campaigns can then be integrated into future ones for an improved shot at those same results, or better.

Implementing KPIs and (crucially) sharing them with key personnel helps your marketing and sales teams improve their own work performance, optimize your ad campaigns, and ultimately close more sales to realize greater profits.

Specific KPIs to Monitor in Your Digital Advertising & Marketing Program

As a method of data collection and analysis, KPIs are essential tools for businesses of all sizes. Yet not all metrics are right for all businesses. In KPIs as in advertising, there is no one-size-fits-all solution. Your KPIs must be selected based on your industry, your marketing strengths and opportunities, and most of all your company’s goals.  

That being said, several KPIs in the area of advertising and marketing provide valuable insights for many businesses. Consider whether these metrics help you get closer to your own business goals. These aren’t the only KPIs you can track, of course. However, many small business advertisers find these particular metrics a good place to start.

Conversion Rate

Your conversion rate is simply the percentage of all people who clicked on your ad, who then took the specific action you want them to take. That action might be signing up for your email list, signing up for a free trial of your product or service, or making a purchase.

The conversion rate, expressed as a percentage of the total number, gives you a picture of how effectively your landing page delivers on the promise made in the ad itself. If there is a tight fit between the ad copy and the content of the page that ad leads to when a user clicks on it, your conversion rate should be fairly high.

The formula for CR is pretty straightforward. First, divide your total number of conversions (however that’s defined for the campaign or ad in question) by the total number of clicks that ad received. Multiply that result by 100 to express as a percentage.

Represented visually:

Number of Conversions / Number of Clicks) x 100 = Conversion Rate

Return on Investment (ROI)

The ROI of any marketing plan or campaign is a straightforward illustration of what you’re getting in return for the expenditures for that campaign. For example, if you’re analyzing the ROI of an ad campaign, you’re calculating how much revenue you can expect from each dollar you spend on the campaign.

The biggest issue in calculating ROI is specifying which costs should be taken into account in the formula. Clearly, the actual fees your business pays to the display network or ad platform are counted. But what about the fee you paid the ad copywriter? Should you include the licensing fee you paid for the use of the stock images? For the clearest and most accurate data, most experts suggest including all costs directly attributable to the campaign—so, yes, factor in the copywriter and the stock images.

To calculate your ROI, simply add together all your costs for the campaign in question, then subtract those costs from the revenue attributable to the campaign. Divide that result by the total costs of the campaign to reach the final figure.

Represented visually:

(Campaign Revenue - Campaign Costs) / Campaign Costs = ROI for Campaign

Cost per Acquisition (CPA)

Another way to evaluate the effectiveness and cost of your ad campaigns is to track the Cost per Acquisition KPI. This KPI measures how much it costs your company in dollars to acquire a single new customer.

This isn’t the same as ROI, of course, which measures the revenue generated by your investment into a specific campaign. Here, we’re looking at how much money it’s costing you in this specific campaign to gain one new customer. If that result is too high, your campaign is less effective, and you’ll want to make adjustments to lower the campaign costs or increase the number of customers gained.

The CPA calculation starts with the total campaign costs—that is, the amount in dollars your company spent to acquire new customers through that campaign—and divides it by the total number of new customers gained through that campaign.

Represented visually:  

Total Campaign Cost / Total Number of Customers Acquired Through the Campaign = Cost per Acquisition ($)

Lifetime Value (LTV)

Customer Lifetime Value (CLV or LTV) is a KPI that takes a view extending beyond the active life of a specific advertising campaign. It measures the value to your company of a single customer over the entire course of their experience with your brand.

From the first purchase all the way through to the last, each customer’s value to your business reflects back a metric that helps you determine how well you’re holding on to existing customers, as well as to what extent they’ll keep coming back. In a sense, it’s also a measure of customer loyalty.

The formula for LTV is reflected in two sequential equations:

1. First, multiply the value of the customer’s average purchase by the average purchase frequency rate to arrive at your customer value metric.
2. Next multiply customer value by average customer lifespan for the LTV.
    

Represented visually:

Average Customer Purchase x Average Purchase Frequency Rate = Customer Value
Customer Value x Average Customer Lifespan = LTV

What About Click-Through Rate (CTR)?

One of the first KPIs to be tracked seriously in the early days of digital advertising, CTR doesn’t really relate to your business’s fiscal or operational health. In that sense, it may on occasion fairly be termed a “vanity” metric.

Simply put, your CTR in and of itself doesn’t reflect any action you want your prospective customers to take. It’s far more effective to put energy and attention towards tracking KPIs that reflect actual value to your company, whether that’s an impact on profits, revenue, or cost of acquisition.

Choosing KPIs

It’s crucial to begin the KPI process by formulating and committing to specific, measurable goals. Those goals can then help you identify the KPIs you want to track. Keep in mind that each KPI is designed to show you the progress your company is making towards those goals.

Once you’ve selected KPIs to track, you can then start the process of pinpointing how the metrics will be tracked, analyzed and reported. Many CRM programs and marketing analytics solutions will help you process the raw data and represent it in a visually compelling and easily understood way.