Canada made cannabis legal last week. However, strict marketing regulations make its industry very different to that of most states that have taken the plunge to legalize already. Last week, Canadians were celebrating with huge spliffs in public parks. They were queuing down the street to buy both recreational and medical cannabis legally.
Canada Weed Legalization
However, if you have ever strolled around a legal dispensary in a state that allows its sale in the United States, such as Colorado or California, then the experience of buying in Canada may have felt overwhelming. No tasty edibles on display. No fancy vaporizers. Not even pre-rolled joints or flowers in sight. Nothing.
Instead, customers got only menus to browse, with actual products stored behind the scenes. When you get what you pay for, which is mostly bud while the industry sets up, it comes in generic packaging, with just one red stop sign on it, a yellow label warning you not to become addicted to marijuana, and the results of laboratory tests, such as type of strain, THC levels, CBD concentrations, and terpenes present.
In order to get both houses of Parliament to approve the legalization of cannabis, this was the compromise made by Canadian lawmakers. For the majority to vote yes, they had no choice but to agree to treat products as clinically as possible, if they were all medical cannabis. This is why all packaging is generic, uniform and solely educational.
Weed Branding in Canada
The reason for this bland packaging is that Health Canada, the government agency responsible for overseeing regulations for weed branding, wanted to approach the issue from the perspective of health and safety instead of just for profiteering. Their primary objective is to ensure that manufacturers never market their products to children.
Although a noble gesture, it comes with significant disadvantages. For new customers, especially those using medical cannabis for anxiety or pain, for example, will find navigating products extremely challenging. Yes, budtenders will be available to advise consumers about the various choices and help guide them toward the best products for their needs, understanding the pot landscape can be trying.
There are different types of cannabis. Sativa, Indica, and hybrid strains affect the brain in unique ways, creating different “highs,” if you will. New consumers will need to conduct some of their own research, along with some heavy experimentation with different strains, to identify those that might provide them with their desired effects.
In the United States, in comparison, consumers have no difficulty finding and buying the strains and products they are looking for in states that sell it. This is because manufacturers are increasingly marketing the differing effects of their strains. As just one example, Dosist markets a range of disposable vape pens named for their effects, such as relief, calm, sleep, even bliss. One knows what to expect.
There is also the challenge of actually using the pot products available in Canada, since, at least for some time to come yet, they consist of almost exclusively dried bud. Consumers have to grind the flowers before they can roll them into joints or fill vaporizers and bongs. Although people have been using marijuana this way for at least 10,000 years, times really are changing.
For consumers in the United States, transparent packaging rules make it much easier for newbies to try other products besides dried flowers, especially those who would prefer not to smoke it or endure the inconvenience of preparing it beforehand. For most, vaping is preferable to joints. According to Forbes, vape sales will either equal or surpass sales of buds by 2022, as predicted by market analysts.
Canada’s Medical Cannabis Decision
The decision to treat all pot as medical cannabis also makes it difficult for investors and entrepreneurs to profit from business in Canada. By enforcing laws that essentially make all packaging as clinical as possible, identical actually, the country is depriving pot companies of the ability to compete with each other by marketing themselves.
Canada is treating weed like a commodity, a medical cannabis product with recreational uses. The narrow focus on selling just flowers also takes away the capacity of companies to be as creative as they need to be to stand out from their competitors. Such stringent rules stymie any potential for new ideas, such as making weed beverages and various edibles.
In the immediate term, these packaging regulations will not stifle the market. Demand was too anticipatory as the date of legalization approached. This was obvious during the widespread celebrations on the first day of legal weed sales. However, in the long term, these rules could have a very negative effect on both consumers and companies.
It will not be surprising at all when cannabis businesses start lobbying federal and local government officials to relax packaging laws and provide them with a more competitive marketplace. This might prove a learning curve for the U.S. government as it considers legalizing weed at the federal level. It would likely look to Canada for lessons on structuring regulations for a legal United States market.
By the time Canada eases some of its stifling packaging laws, weed may well be legal in the United States too. However, it would be unwise to think that the U.S. government will take any tips from the Canadian marketing experience, only lessons. Despite much talk about protecting children from pot advertising, generic packaging would be tricky here, since consumers expect weed branding already.