Q&A with IRI’s CBD and Cannabis Expert

December 5, 2019 in Blog

Larry-Levin

Our Q&A series shines a spotlight on the biggest challenges, questions and trends in the programmatic marketplace with commentary from industry experts, clients and partners.

Today’s Q&A is with Larry Levin, Executive Vice President of Consumer and Shopper Marketing at data and insights company IRI.

We asked Levin to break down everything marketers need to know about the burgeoning cannabis industry.

Q: How big is the current cannabis market?

 In a word: Blossoming! IRI’s cannabis research partner BDS Analytics projects a global market of approximately $45 billion in total cannabinoid sales by 2024. For 2019, we’re estimating sales of $14 billion. In our CPG world, we see growth of 2-3% if we’re lucky; the opportunity for cannabinoids is unprecedented.

Q:  How can marketers best approach the challenge of educating consumers about cannabis?

As products move mainstream, education is needed throughout every level of the consuming landscape. In recent research published BDS Analytics, it’s clear that the vast majority of consumers in legal states ― where you would think confusion would be less clouded ― is still extremely confused.

BDSA’s research shows that over half of all respondents either don’t know the difference between CBD and THC or are wrong in their perceptions of what each is. While it’s down from 63% nearly a year ago, it clearly shows how much confusion rests in the market and is a signal that education is needed and could be most critical at the “final decision point” as retailers have to be sure their staff is aware of market differences between THC and CBD. In fact, the survey results from BDSA also show that consumers believe that any product that contains hemp will have an “altering experience,” which is simply not the case.

Q: Who is the typical cannabis consumer – if one exists?

Stereotypes need to be trashed when it comes to the mindset of who a typical cannabis consumer might be. Consumers mirror the U.S. population with young and old, the haves and the have nots, as well as urban and rural consumers. If there’s any demographic bent toward hemp use, it’s that it skews a bit more male. And hemp users are finding the products provide great relief for a number of ailments from anxiety to depression to pain and stress, which poses a threat to the over-the-counter medication market.

Q: What do marketers need to know about the regulations and laws regarding advertising cannabis products?

We are still at the very early stages of marketing for any cannabis products. As with alcohol, legislation varies from state to state, and even with counties and cities within those states. Legislation is changing and will continue for some time, so marketers will need to do their homework.

Social responsibility should be at the forefront of importance in messaging and its impact, especially with all of the press around the vape market and recent deaths. It’s apparent from our consumer data that education is clearly needed, and first and foremost it could be educating the consumers about the differences between THC and CBD as leading cannabis products available today.

Q: U.S. cannabis retail ad spend increased 24% in 2018 to $4.12 million, most of which came from out-of-home advertising, according to eMarketer. What is it about OOH that is particularly appealing to cannabis brands?

It’s a testimony to the “out of home” nature and active lifestyles that a number of consumers are engaging in, including exercise, living outdoors, and attending social events. Consumers’ ability to easily acquire THC and CBD products in legal markets gives them alternatives to consider that were not available a few short years ago.

Q: Data has become a key factor in driving growth in every vertical. What role can data play in the cannabis industry?

Data is simply “an ingredient” to understanding this market. Data continues to show how consumers are gaining more understanding and increasing their positive consideration to trying CBD and THC products. As the market becomes more mainstream in consumer adoption, it will become more mainstream in the general CPG market. Data will help quantify the size of the opportunity and where marketing and sales efforts should be concentrated. And, while more than half of today’s market connects sales through dispensaries, the channel will see much greater competition in the coming years as CBD goes mainstream. BDSA and IRI predict that in less than five years the dispensary channel will see share shrink to 25% of the market even though channel sales are forecasted to grow 2.5 times their current rate, showing that the market will be more competitive as consumers purchase “here, there and everywhere!” Data will be at the forefront to understand the who, where, how and why to win in this incredibly opportunistic market; it’s the most disruptive change we have seen in CPG in years, if not ever!

Q: What is unique about IRI’s partnership with our DSP Adelphic?

While this doesn’t speak to cannabis currently, IRI’s ability to understand the consumer and create activation plans is a perfect complement to Viant’s measurement of its 1.2 billion registered users; we have a matched universe of 83% unique profiles. An additional benefit is we can track offline dollar sales on a weekly basis to drive campaign optimization across a variety of tactics, including device delivery, shopping behaviors, audiences, inventory or campaign creative.

For those ready to really dig in and understand marketplace trends, I recommend a webinar I recently conducted with BDS Analytics just on this topic.

Q: What are the terms marketers should know when talking about the Cannabis market?

Check out our Cannabis “dictionary” here.

 

CBD Dictionary: All the Terms You Need to Know

December 5, 2019 in Blog

cbd-oil

The cannabis industry is exploding – but research shows that consumers and marketers alike are confused by the unfamiliar terminology in the marketplace.

To help, we’ve compiled the top cannabis terms to know as everything from CBD to hemp to marijuana becomes more mainstream.

Cannabis: A genus of flowering plants. Hemp and marijuana are simply broad classifications of cannabis that were adopted into our culture; however, they are not legitimate nomenclature for the cannabis plant.

Marijuana: A term used to classify varieties of cannabis that contain more than 0.3% THC (by dry weight).

Hemp: A term used to classify varieties of cannabis that contain 0.3% or less THC content (by dry weight).

Cannabinoid: One of a class of diverse chemical compounds that acts on cannabinoid receptors, also known as the endocannabinoid system in cells.

CBD: One of more than 100 cannabinoids found in cannabis plants (hemp and marijuana). Studies find application for anxiety and cognitive movement disorders, and find that consumers look to CBD for health and wellness benefits, including improved quality of life, to sleep better and to relieve pain.

THC: One of over 100 cannabinoids found in cannabis plants. The primary psychoactive or intoxicating compounds. Beyond intoxicating effects, applications include anti-nausea and appetite suppressant.

Adult Market: Adult Use, Recreational Use and Social Use are used interchangeably to describe the Recreational Dispensary Channel. You will also see Medical, which refers to purchases made by someone holding a medical card/license.

Level 1 States: These are fully legal cannabis (marijuana markets) states, where a retail landscape is established — AK, CA, CO, OR, WA, NV and MA. Looking at the size, growth and consumer behavior in fully legal markets provides an indication of the future U.S. marketplace

Contobox on Trends in Online and Offline Consumer Purchasing Behavior

November 14, 2019 in Blog

Our Q&A series shines a spotlight on the biggest challenges, questions and trends in the programmatic marketplace with commentary from industry experts, clients and partnerships.

Today’s Q&A is with Christine Carey, GM and SVP of Sales at Contobox, which offers an engagement management platform that empowers marketers to develop, launch and analyze interactive digital display and video campaigns.

A veteran of the ad tech industry, Carey is responsible for identifying and securing new partnerships, managing partner integration efforts and helping brands effectively use data-driven creative technology in their businesses.

Q: How important is it to simplify the online shopping process for consumers so that it’s more in line with expectations set by Facebook, Instagram and Amazon?

Experience is becoming more important to consumers, which is why we’re starting to see some form of shoppable ad units on every major platform. Facebook and Instagram offer shoppable posts, Pinterest has “shop the look” pins and Google added shoppable ads to their image search results earlier this year. At Contobox, we developed shoppable ads that can be run programmatically, giving consumers the opportunity to discover new products, compare them and add them to their online shopping cart from wherever they’re browsing on the open web.

In a time-crunched world, where people have more options than ever, using tech like this to remove the number of clicks to purchase couldn’t be more important. People are spending more and more time considering their purchase, whether that’s browsing or reviewing products, which means brands need to find more creative ways to drive them to conversion. Ad units that showcase more of your offering and give consumers an easier way to check-out can definitely help. Based on the campaign data we’ve collected at Contobox, shoppable ads can have a big impact on a brand’s ROAS, so I would say it’s extremely important.

Q: More and more people are shopping on their mobile devices, but the amount of money spent via desktop continues to increase as well. What does that tell us about today’s consumers?

It really just reaffirms what we already know: People are busier than ever, and busy people want convenience. As more brands work to enhance their digital offerings through innovations like shoppable ads, more people are realizing that they’re going to find that convenience online.

Even those who prefer to shop in stores, either for the experience or simply because they need to see the item in person, are starting to rely more heavily on digital. We’re seeing more people reach for their phones rather than connect with in-store associates to gather product information, compare costs or search for deals and coupons.

Q: What kinds of shifts in consumer purchasing behavior have you seen?

P&G’s 2005 “Moment of Truth” model describes the customer’s decision-making process based on three “moments” – buying the product, experiencing the product and then becoming a loyal customer. The rate of online shopping, both on desktop and mobile, has risen dramatically since 2005, and that’s resulted in a huge shift in the way consumers interact with brands. Not only has it given people more product options than ever, it’s also made it easier for them to browse. Perhaps not surprisingly, then, people tend to be a lot less loyal to brands than they once were. That increasing search for convenience also means that experience is becoming a bigger factor in people’s decision-making process.

In fact, we know based on recent research from Salesforce that the majority of customers now consider experience as important as a brand’s products or services — and as more people move online, a better customer experience is a better digital experience. That’s what’s really going to help your brand stand out. It may not matter how much time your competitor spent building brand equity and trust if you’re able to provide a more helpful and convenient experience.

Q: Many consumers conduct research or search for coupons on their phones while in brick-and-mortar stores. How do interactive ads benefit both brands and consumers in this situation?

Interactive ads can track a lot more consumer information, and that can help brands understand their audience’s buying behaviors in a much more detailed and nuanced way. They can also provide consumers with all of the product information and potential savings they’re looking for directly in the ad unit, so they don’t need to click through. No matter where your target audience is shopping, or how they plan to make that final purchase, being able to showcase more of your offering — wherever they happen to be browsing — is going to help your brand stand out and give you a huge advantage over the competition.

Q: What stands out about Adelphic’s partnership with Contobox?

Adelphic’s client-base is used to receiving best-in-industry data offerings in conjunction with cross-device and cross-format executions, and partnering with Contobox has allowed them to build on these strengths. They can now offer clients more advanced creative capabilities that can be delivered at scale across the open web. Our formats provide consumers with the full eCommerce experience, which helps enrich Adelphic’s already incredible data offering with engagement data, giving brands even deeper insight into their customers’ buying behaviors.

Q: Looking ahead, what do you see as big trends for 2019’s holiday season?

Speed, flexibility and convenience are what matters most to consumers, especially during a hectic time like holiday shopping. The best way to accommodate those expectations is through true personalization and truncating the purchase cycle, and nothing makes it easier for brands to achieve those goals than shoppable ad units. Unless of course we’re talking about our new Virtual Wallet feature, which allows consumers to save special offers promoted in display and video ads directly to their Google Pay or Apple Wallets well in advance of prime shopping periods to help them prepare.

Trader Diaries: Lone Ranger Manager of Programmatic Solutions

October 21, 2019 in Blog

Age: 31
Title: Manager of Programmatic Solutions
Employer Type: Small Agency
Years of Programmatic Trading Experience: 5

6:30 a.m.: I quickly take a shower and get ready for work. No time to make lunch – I will be buying lunch today. I make sure the pets are fed and happy before I start to head out!

7 a.m.: I leave to catch my 7:08 bus from N.J. to N.Y. The bus usually takes about an hour and a half without traffic, but since today was Monday, it took nearly two hours. I usually play a few rounds of sudoku while listening to music to help warm up my brain and get ready for the day. Sometimes I will find myself dozing off while in the middle of a puzzle. Sleeping on the bus is not ideal and I try my hardest not to sleep. Walking from Port Authority to the office takes about 10 minutes and grabbing coffee is a must 🙂

9:18 a.m.: I arrive at work a few minutes late due to the late bus. First thing, I turn my computer on, get settled and mentally prepare myself for what is to come by going through any missed emails and reminder notes. After checking my calendar to see all meetings for the day, I log into the platform and check in on every live campaign to make sure pacing is doing well, and document performance.

10:15 a.m.: Fire drill! Another liquidation campaign came down and they need to be up and active within 24 hours. While creating an authorization for the campaign, we are already being sent location and creative data from the client. We send the request for authorization to the client for signature. No campaign can be entered into the system unless we receive a written agreement, so we are at a pause for now. While waiting for the signed authorization, I continue to finish up my campaign pacing and documentation from the morning.

Lunchtime: For lunch I like to take a 10-minute walk to stretch and get moving a little. I stopped to get a chicken Caesar wrap and a bag of popcorn at the corner deli and brought it back to eat lunch with my coworkers in the conference room. We talked about the Marvel universe and how they can still legally put Stan Lee in the new movies, even though he passed away. Our lunch conversations change from day to day and can span from what happens in the afterlife, to religion or sports. We try not to talk about politics, but it always comes up, then the conversation ends with someone or multiple people shouting!

3 p.m.: Since we received the signed authorization around 2:30, I can now start to gather all given campaign info and start uploading all creative assets and geotargeting specifications. Since this is not a big agency, I am in charge of all these tasks as well as all the campaign setup. I love my work, but I do find it challenging at times having to be the only programmatic person. However,  I set up easy cheat sheets, I know the platform pretty well and I am confident in the work that I show.

3:45 p.m.: I was called into a meeting discussing new client opportunities. From that meeting, there was a request for a forecasting run, and a few other elements of reporting to see previous spending, current spending, demographic analysis to create new personas, and so on.

5 p.m.: I was able to leave work on time, and quickly ran to Port Authority to catch my 5:15 bus back to N.J. It took about an hour and 45 minutes to get home with a little bit of traffic, so I was home at 7. Once I got home, I changed into pajamas and started to relax and let the day’s stress melt away while talking to my boyfriend about some of my daily work challenges.

7:30 p.m.: For dinner I took some chicken breast out of the fridge and baked it in the oven, while making mashed potatoes and some corn.

9:30 p.m.: Usually around 9:30 is when I will lay in bed and watch Netflix or Hulu. My boyfriend and I are usually watching three or four shows simultaneously, so it really depends on our mood what we will watch. We ended up watching some of season three of The Office, it is probably the fourth run through of that entire series!

11:15 p.m.: I fell asleep with the music from The Office’s theme song playing in the background. I make it a point to get a good amount of sleep so I can be the best version of myself for the day to come!

Trader Diaries: 30-Year-Old Agency Media Planner/Buyer

October 21, 2019 in Blog

Age: Too young to feel this old (30)
Title: Media Planner/Buyer
Employer Type: Agency
Years of Programmatic Trading Experience: 3

7:15 a.m.: My alarm initially goes off and, after three snoozes, I finally find the inner strength to rise and shine. After throwing on my usual work uniform (a simple work appropriate swing dress, or as I like to call it my “mumu,”), I must drag my beagle out of bed to go out. Wardrobe tip for the hot and humid south: Invest in some breezy dresses.

8 a.m.: I live in downtown Birmingham, so luckily my commute is minimal and we have a private lot so I can drive and listen to one of my murder podcasts as I mentally prepare for the 1,000 tasks and meetings awaiting me.

9 a.m.: I typically have a meeting of some kind first thing, and today is no exception. So I spend the first few minutes in the office refreshing myself on any relevant info and prepping for a client meeting regarding an upcoming launch. This includes reviewing my plan presentation and making note of any questions we may need to address.

After that, I race over to our agency bleachers for an intern presentation on the latest advertising trends. My work wife and I are very proud of our little ones. I can be a bit of an Abby Lee a la Dance Moms when it comes to coordinating presentations. Soon they will begin finalizing their client presentation, which will be a full pitch.

10:30 a.m.? I take a little mid-morning break and try to stave off hunger with a Diet Coke, my life elixir.

11 a.m.: After my mid-morning break, I spend a block of time where I responded to emails both internally and externally.

Lunchtime:  I had a lunch meeting with a digital rep, so luckily food is provided. Lamb meatballs and Greek salad. On the agenda, we discuss custom creative opportunities as well as their proprietary AI solutions.

3 p.m.: I’m working away building out some digital campaigns for an auto client with a site traffic KPI and a healthcare client with a VCR goal. This involves two platforms and executing our plan, so placing all relevant settings and safety measures in place as well as creating tracking sheets on our end to monitor campaign performance and spend.

6 p.m.: I have a work trip to Utah tomorrow for an OOH conference with speakers on everything from client relationships to understanding what drives millennial consumer habits, so I go directly home to pack and get some sleep before another early morning.

7:30 p.m.: For dinner, I reheat some leftover Zoe’s from my earlier lunch meeting while watching reruns of The Office.

9:30 p.m.: I’m trying to finish up a few things (building out some social campaigns and budget tracking sheets and some auto plans for the next month) before curling up with my pup in bed.

10 p.m.: I end my day and try to go to sleep and forget that I need to be up at 3:30 a.m. for my flight to Utah.

Trader Diaries: Wifed-Up Trading Strategist

October 21, 2019 in Blog

Age: 25
Title: Trading Strategist
Employer Type: Media Company
Years of Programmatic Trading Experience: 3

6:25 a.m.: It’s not easy to get out of bed. As a Trader you’re constantly thinking of your duties, whether it’s a campaign that won’t perform or a new project that you’ve been assigned. You think about these things so much that they could even affect your sleep schedule.

7:10 a.m.: I leave for work and head for the train station to take a train and a bus to work.

9 a.m.: From the time I wake up, I’m answering emails/pings, so by the time I get into the office I’m up to speed on what the morning will bring me in terms of “fire drills” and important campaigns to focus on. Once I get into the office, I look into a campaign my Sales team was emailing me about earlier that wasn’t serving correctly, and had to put out that “fire.”

10:30 a.m.: I’m helping a Campaign Manager with their campaign. It doesn’t seem to be delivering, so we’re taking a deep dive into the platform setup and looking into what could be hindering scale. This takes some time because every ad order is different with different targeting and a different set up. This also means collaboration with other departments to find the issue and solution. All the while, Sales is constantly checking in asking for an update. Ahh!

Lunchtime: Unfortunately, like most days, I didn’t have time for lunch! As a result, I starved through the day and was looking forward to going to dinner with my wife when I eventually got home.

3 p.m.: A handful of Campaign Managers are using a new process workflow I created that speeds up campaign builds by at least 24 hours. I’m walking them through how to use it efficiently and how to use it on their own. This is a new product I’ve been working on for months, so to see it finally roll out is very exciting!

4:45 p.m.: I leave for the bus at the same time every day, or else I miss my train home (this can be difficult when where’s a lot of work to do!). Sometimes I take my laptop with me on the bus and train to continue my work.

7 p.m.: My wife and I check out a brand new Cajun seafood place that opened up near us for dinner. As I go over my day, I always see her eyes glaze over because I’m talking in acronyms like “CTR” and “IO” while speaking code like “Impressions” and “Flights.” You definitely have to be in the industry to fully understand it.

9:30 p.m.: I do a last check of emails and pings before going to bed, making sure nothing urgent needs to be looked at. The internet never sleeps so never shall I!

11 p.m.: I’m starting to fall asleep … and dream about my campaigns.

Trader Diaries: Hungry Agency Media Planner/Buyer

October 21, 2019 in Blog

Age: 27
Title: Media Planner/Buyer
Employer Type: Agency
Years of Programmatic Trading Experience: 3

5:15 a.m.: My alarm goes off and I hit snooze four times — 36 minutes of planned exercise time down the drain. After showering, picking an outfit and packing lunch, I head to the office. Mentally, I’m determining which of yesterday’s unfinished to-do items should be atop of today’s list — check on a newly enabled medical programmatic campaign, diagnose a placement issue in DoubleClick campaign manager, determine what a reasonable cost-per-lead is on LinkedIn, work out after work since I snoozed through the morning.

8:45 a.m.: I left for work later than I should have (technically the work day begins at 8:30!), and I arrived by modern day horseback: a Ford Mustang. Parked the pony, jetted up the steps to my cube.

9 a.m.: The first thing I do once I get to work is take a deep breath then open my inbox. Inside, there are questions about tagging/implementation, and programmatic campaign setup. I give advice on what to include in a custom audience and how to properly tag HTML 5 creative.

10:30 a.m.: I’m comparing digital CPMs and CPCs for automotive campaigns. I’m always looking for the most impressions for the fewest dollars — clients, however, are fine with investing in high-dollar conversions. Buying a place instead of a face cost us over $100 per thousand impressions! The benefit of programmatic buying is that you can buy an audience, and never have to guess what sites or apps they use.

Noon: I brought leftovers for lunch, reheated my food and ate at my desk. The pot roast wasn’t the only thing I was chewing on — I was mulling over how to convince a client that there is no need to spend over $100 CPM when a similar video placement could have a CPM less than $10. My food got cold before I could eat it all. I was interrupted with a handful of “Can you pop over for a second?”’s.

3 p.m.: I’m on a client status call. We discuss programmatic market and creative rotation for their current campaign.

4 p.m.: My teammates and I discussed which fast food sandwich gif would generate the most engagement. Should we include a GIF showing a bite out of a crispy piece of chicken, or should we include the pouring of a creamy milkshake?

6 p.m.: I leave work and go to my traditional Tuesday at Buffalo Wild Wings. I missed my workout, too!

9:30 p.m. I quickly glance at my inbox and binge watch a few episodes of Younger on demand. It’s fantastic — hard to believe it’s a TV Land original.

11:12 p.m.: Time to get to sleep!