Posted by Marijuana Doctors on 06/06/2017 in Economics
Updated on December 19, 2018.
Medical content reviewed by Dr. Joseph Rosado, MD, M.B.A, Chief Medical Officer
With more than half of the United States legalizing or decriminalizing marijuana, advertising for weed and weed-based products has become something of a hot topic for marijuana dispensaries. What are they allowed to advertise and where? What can they include on their tax reports? Should they worry about fines if they try to promote their product? Here’s what you need to know about advertising a cannabis businesses.
Federal Restrictions on Cannabis Advertising
Even in states where cannabis is legal, weed businesses that want to advertise their products and services have to tread lightly. Marijuana is still considered a Schedule I drug by the federal government, which means it’s treated harshly by federal law enforcement and regulatory organizations. It’s also closely controlled by the Controlled Substances Act (CSA).
So what are the big things businesses have to keep in mind when considering advertising their services? Here’s the basic list:
No Write-Offs: Because of its classification as a Schedule I substance, business owners cannot write off any advertisements for weed as marketing expenses.
No Radio: Radio advertising is highly restrictive, especially when it comes to controlled substances. As such, advertising for cannabis products and services over the radio is illegal.
Avoid Email: Direct email marketing has some restrictions as well. In the state of Rhode Island, for example, it’s illegal to advertise using email.
Avoid Print Media: Advertisements in newspapers and magazines is tricky business, especially since the USPS has stated that such advertisements for marijuana violate the Controlled Substances Act (CSA), which states that any written advertisements placed for the purpose of receiving, buying or distributing a Schedule I substance are illegal under federal law.
As a Schedule I drug, marijuana falls under this portion of the law, making it illegal for newspapers, magazines, handbills or any other publications to advertise for marijuana. If the USPS identifies any such advertisements distributed through the U.S. mail system, they are legally obligated to contact the Department of Justice. Due to the widespread public backlash, however, we could see this restriction modified shortly.
FTC Regulations for Cannabis Advertising
On top of these legal restrictions, there are many advertising restrictions imposed by the FTC. The FTC’s regulations primarily require advertisements to follow ethical guidelines. These include:
No Advertising to Minors: This will be a clear restriction for most businesses. While all companies want to influence their future consumers positively, marijuana can pose harm to children and young adults. Recent research studies have shown that cannabis consumption negatively affects cognitive development for those under the age of 25, since their brains are still developing.
Marijuana businesses, therefore, are both morally and legally obligated to avoid advertising to minors. This includes placing age restrictions on websites for marijuana dispensaries. Some states have even prohibited the placement of public ads like billboards and posters altogether. Placement of ads near schools is particularly illegal.
Limit Glamorization: Regarding content, advertisers must avoid promoting the glorification of smoking marijuana. This includes showing a correlation between consumption and unrealistic personal gain or promoting over-consumption. For example, showing marijuana smoking as a way to get more sexual pleasure would be an example of unrealistic personal gain that qualifies as glorification. Promoting illegal activities like driving under the influence is also prohibited.
Don’t Make Unproven Claims: This applies to all advertisers but is particularly the case for marijuana distributors. Always be as factually sound as possible when advertising for marijuana, since the drug is already carefully scrutinized. Do not make misleading or false claims and do not make claims that are still unproven. For example, don’t claim marijuana “cures cancer” — instead, state that it can help manage pain for cancer patients.
What Does This Mean for Your Business?
These restrictions and regulations have obviously limited the advertising capabilities of many marijuana businesses throughout the United States. Both medical and recreational dispensaries want to be able to set themselves apart from their competition, but doing so requires ad dollars and a solid advertising platform. To get around these restrictions, dispensaries have had to get a bit creative.
If you want to start advertising for your marijuana business, try to keep the following in mind:
Use the Internet: Technically, advertising for marijuana sales or distribution over the internet falls under the same restrictions as radio advertising. However, enforcing such laws is much more challenging, making the internet the most viable platform for extensive marijuana advertising.
Advertise using a dedicated website for your dispensary and work with other sites, like www.marijuanadoctors.com, to promote your business. The one thing you should avoid, however, is digital pop-up ads. Since these are not age-restricted, you could accidentally advertise to a minor, violating FTC regulations and breaking Colorado state law.
Target Older Markets: Since marketing to groups under the age of 21 is both illegal and amoral, focusing on older markets should be your goal. Place age restrictions on your websites and try to post private advertisements in areas that cater to older age groups, like bars and clubs.
Get Involved Locally: One of the best things you can do for your business is get involved on a local level. Get a booth at a local festival, volunteer your time for a charity or two or work in conjunction with local businesses to get your name out there. Not only does this help spread the word about your business, but it also improves people’s perception of your business.
The Future of Cannabis Advertising
The future of marijuana in the United States is improving, but the legal confusion surrounding weed is still a barrier for many businesses. While our representatives discuss the particulars of federal versus state law, the cannabis industry has to take action and establish standards for appropriate marijuana advertising.
The alcohol industry has done much the same in the past, self-regulating to determine acceptable advertising standards. If marijuana businesses banded together to do the same, they could combat the confusing laws of the United States government while also improving advertising reach and protecting minors from undue influence.
Learn More About Marijuana Law
The laws concerning medical marijuana is constantly changing as national attitudes toward weed continue to improve. We’re here to help you navigate the legal loopholes and developments. Learn more about marijuana law by browsing our blog.