Celebrities impact on Cannabis has been limited
Celebrity Star Power Has So Far Had Limited Impact on Cannabis. Famous names, mixed results.
Celebrities from Jay-Z to Justin Bieber are trying to make their mark on the cannabis industry with high-profile product launches and collaborations. It’s easy to see why they want in: Pot is expected to become a $45.8 billion market by 2025, according to projections from data firm Headset.
But whether it’s Seth Rogen’s prerolled joints or Cann, the THC beverage backed by Gwyneth Paltrow and Rosario Dawson, their products face a crowded market that’s struggling with tumbling prices, a thriving black market that’s undercutting the legal one, and a complex patchwork of rules that varies from state to state. Not to mention stalled efforts at federal legalization that limit cannabis companies’ access to credit and banking services.
So while celebrity-backed brands have generated a lot of press, most haven’t become top sellers in the highly fragmented and still-nascent cannabis market. Some retailers in states where marijuana has been legal the longest say that celebrity-linked brands have struggled to seriously compete with bigger labels such as Jeeter and Pacific Stone.
For Daniel Firtel, who leads TRP, a cannabis retailer with 18 dispensaries across eight states, he’s noticed that consumers don’t “necessarily care as much about celebrity attachments.” The vast majority of his company’s top-selling brands aren’t celebrity-linked ones, he added.
Statehouse Holdings Inc., a cannabis company with 14 California stores, similarly noted that celebrity lines haven’t upended the competition.
Nonetheless, celebrities have seen some success. When Martha Stewart launched a line of CBD products with Canopy Growth, sales rose swiftly, outselling competitors as well as bringing in new customers, a company spokeswoman said. Mike Tyson’s line of cannabis products, called Tyson 2.0, has also done relatively well: The former heavyweight boxing champion’s brand has recorded $20.7 million in retail sales since launching in November 2021, according to Headset data.
Positive early returns notwithstanding, celebrity-backed lines still have to build a loyal customer base to maintain longevity — a task that’s already proven to be a struggle. One typical way of achieving this, radio advertising, is prohibited due to marijuana being federally illegal, even if the product is allowed California, New York and Illinois.
Marketing restrictions have pushed brands, such as Snoop Dogg’s Death Row Cannabis, to become more creative in reaching potential customers. Brands have focused marketing efforts on “buyers and more specifically at their budtenders,” said Tiffany Chin, who leads Snoop’s cannabis ventures.
Winning over those dispensary retail workers can be “very advantageous” for celebrity brands, according to Headset analyst Cooper Ashley, given they carry an “extraordinary” amount of influence over customers’ purchases. Most, if not all, transactions in the cannabis industry happen between a customer and a budtender, Ashley added.
For Firtel and TRP, celebrity-backed products simply don’t have the capital or bandwidth to grow to the level of their more mainstream peers.
“A rapper or some sort of musician or celebrity, they’ll put out a strain and then it’ll kind of get launched and there’s a little bit of hype, but then there’s really not the follow-up,” Firtel said. That’s “because they don’t have the infrastructure, the team and, really, the level of commitment that is necessary in cannabis.”