If you weren’t familiar with CBD before, you’ve probably at least heard about it over the past year. The industry is booming after the passage of the 2018 Farm Bill, which legalized the regulated production of hemp. This opened the door for the legal production of CBD. CBD, short for cannabidiol, is the second most prevalent active ingredient in cannabis.
Unlike smoked marijuana, it doesn’t contain THC (tetrahydrocannabinol), which is the psychoactive compound that produces the signature “high” associated with the plant. Users rave about cannabidiol and the positive effects they report it has. Considering the growth of the industry, the enthusiastic consumer base, and the more favorable legal landscape, there’s never been a better time to get in. If you’re considering it, let’s go over five basic tips for entering the CBD business.
1. Know your local laws and regulations.
One of the most important things to do when you’re entering any part of the cannabis industry is to familiarize yourself with the applicable laws and regulations in your area. If you plan to sell your product online, you need to be aware of the laws in every country you ship to, so that you don’t unknowingly violate them and get yourself and your business into legal hot water. There are also restrictions on advertising related to CBD on certain platforms or by using certain verbiage, so be conscious of how you promote your products.
2. Understand the industry.
If you haven’t worked with cannabis products before, you should put time into learning about the plant itself and what its effects are. If you’ve never used a CBD product, maybe it’s time to try one for yourself so you can better understand what you’re selling. Believing in your product and being conscious of your place within the industry is essential if you hope to succeed in a competitive environment.
3. Listen to consumers.
Customer experience is the lifeblood of your business, and making sure that you’re providing the products they want is one of the simplest principles in any business. When it comes to products that can affect health and wellness, it’s especially important to communicate with your customers and make sure you have the knowledge required to answer their questions and provide insight into what benefits they can expect and what using the product will be like.
There are plenty of new tools to help you learn how to more effectively respond to the needs of your customers, like the Alchemer platform. What Alchemer does is use simple surveys and analysis tools to make sure the concerns and feedback from your consumers are ready for you to best use it when working on your product development and practices. Major companies like FedEx, Verizon, and Adobe use Alchemer to great effect, but regardless of what size organization is using Alchemer tools, these simple surveys will help business managers hear the voice of their customers come through loud and clear. This actionable feedback will translate into more sales and, therefore, more profits.
4. Be creative with advertising.
As previously mentioned, many platforms have restrictions on how any cannabis products can be advertised. This means you’ll have to get creative to get the word out about your brand. While the advertising landscape is slowly becoming more favorable, there are still plenty of other ways you can promote your products. You can create engaging content via blog posts and articles to get your company name out there and use search engine optimization (SEO) and content marketing to help your business get the best results from search engines. Offer discounts and loyalty programs for repeat customers, or even work on some non-CBD based new products and advertise those. Use customer feedback to guide these practices as well. If the customer feedback points to discounts, that’s the way to go. If they prefer loyalty programs, maybe those are the better option.
5. Offer unique and high-quality products.
In an industry that’s booming, standing out from the crowd is essential. While smokable joints remain one of the most common methods of consumption, the market is still growing for other options. Products like CBD drops, tinctures, balms, and even edibles are gaining popularity. With the ability to use products like drops or balms, CBD appeals to more customers who may not be interested in smoking and offers an easier and more discreet way to use your new products and still enjoy their potency. Users of cannabidiol rave about the positive effects on things like anxiety, chronic pain, and insomnia, and while medical studies are still ongoing in regard to many conditions, the FDA recently approved its first CBD-based drug, a seizure medication called Epidiolex.
While CBD is exploding in popularity, the market growing, and the chance for new businesses to get in while the industry is in its early stages of development. The legal restrictions can be challenging, depending on where you live, but within the United States, the Farm Bill has made it feasible for most businesses to offer hemp-based products and cannabis products that contain cannabidiol but not more than trace amounts of THC. If you’re an entrepreneur looking for an opportunity in an interesting and rapidly expanding industry, investing in or starting a CBD business might be the idea you’ve been waiting for.