Barred from online advertising, retailers use organic content on social media to sell CBD

Kimmie Kay knew nothing about hemp until a friend suggested she try a hemp-derived oil called cannabidiol or CBD for her chronic back pain—an inoperable condition for which she took multiple over-the-counter painkillers every day.

Within a few months, the pain was gone and Kay was selling CBD to customers. But hemp oil, she quickly learned, was anything but an easy sell.

“There are a lot of difficulties if you’re not selling directly to stores,” said Kay, who now works as a senior sales rep at Silver Shadow, a Utah-based wholesaler that manufactures hemp derived-products, including CBD.

“I keep tabs on our clients,” she said, “especially if they’ve ordered quite a lot of product and I don’t hear back from them in a month or two. And 90 percent of the time, it’s an ecommerce problem.”

Despite CBD’s popularity with consumers, and the fact that hemp and its derivative products were formally legalized in 2018, online sales remain a major sticking point for retailers of hemp products. A maze of uncertain regulations has spooked banks and payment processors, and major ecommerce platforms, including Amazon, refuse to list products containing certain hemp-based ingredients. Social media platforms, including Facebook, Twitter and even Google, have banned advertisements for products containing CBD.

Some retailers have resorted to misrepresenting or even outright lying to get around the rules for selling hemp online, prompting the FDA to announce a planned crack down this past April. Those in it for the long-haul, Kay said, have adopted a different approach using organic content and connections to drive growth on social media.

“It’s very tough because you can’t advertise on Facebook,” agreed Ben Rogers, president of Texas-based Pure Releaf, which manufactures bath products, lotions, pet treats and other products containing hemp. “So it’s going to have to be this organic growth, this grassroots growth, where you’re going to have to work hard, sweat, and make connections. There’s no magic systems or formula around it.”

At the federal level, the FDA has banned advertisements that make drug claims—statements that suggest a product is capable of treating or curing a medical condition. The federal agency also prohibits the sale of food products, for both people and animals, containing “added CBD,” but seems to have left the door open to products with naturally-occurring CBD. This has triggered angst among retailers, whose consumers are primarily interested in the potential health benefits of CBD, according to Bill Bookout, who has lobbied to open up regulations for hemp-derived products on behalf of the National Animal Supplement Council.

Confusion about precisely which products and statements are prohibited has created further difficulty, causing banks and other professional service firms to turn away companies that sell hemp and CBD, Rogers said. Selling nation-wide is even trickier, because each state has its own restrictions on hemp and CBD sales. And most social media platforms have their own rules about selling and advertising CBD.

But many hemp retailers have found success using organic content and conversational commerce to network with prospective customers on and offline--an approach Jesus Arguelles, Chief Cannabis Officer at LA-based Greenfox Holdings, calls a “high-touch solution.”

Large swaths of the cannabis industry are still dominated by mom-and-pop operations, and that allows each business to cater to hyper-niche customer groups, Arguelles said. Many successful cannabis retailers use “guerilla” marketing tactics to reach new customers, meeting them at community and religious centers and capitalizing on local markets.

Smaller retailers, Arguelles said, may actually have an advantage over larger companies in the cannabis industry, because they rely less on the paid media and are more able to build trust with consumers.

Kay learned this lesson herself after realizing that while she can’t take out an ad for her products on Facebook, she can share personal stories or case studies. She can respond to questions when customers message her. She can build an email list for product news and promotions. She’s even thinking of starting a podcast.

Even more than other companies, those specializing in CBD and hemp need to think of their brand and social media presence holistically, said Maximilian Thomas, a branding consultant who works with retailers of cannabis as the CEO and owner of Green Business Brand Coaching. He teaches his clients to portray themselves not as a cannabis or CBD company, but as a lifestyle company.

“I know very active social media pages, and they only sell cannabis products,” Thomas said. “I tell people, when someone tells you no, what they’re really telling you is to try harder. Put the information up in a different way.”

Instead of listing or advertising products, Thomas has his clients focus on educational or general content that doesn’t put the stigmatized ingredient front and center. A brand might post a picture of a beauty mask and link to the product on their website. They don’t need to talk about the CBD in the mask until the customer is on their private website, he said.

Posting about the brand’s story, rather than the ingredients it focuses on, is another effective strategy that happens to be a low-cost way to begin building a brand on social media. “Don’t reinvent the wheel,” Thomas said. “Take pictures of what you’re already doing, whether it’s the product itself, or yourself designing. You don’t have to book a studio when you’re trying to launch a page.”

Persistence is also key. Thomas said he’s watched multiple brands “shoot themselves in the foot” because they gave up on social media when the brand’s page wasn’t an overnight success.

“It’s not something you give up on,” he said. “The worst thing to do is stop posting or delete your account.”

In most cases, Thomas said he has his clients check their social media stats for progress once every three months.

With persistence, Kay said, she and other retailers have successfully built a following online, enabling them to gradually introduce hemp to their customers.

“You have to market, you have to have a following,” she said. “The ones that do have a following and hit stores and boutiques, they’re successful. They’re the true hustlers. They’re not blinded by thinking you can just throw it online and be a success.”

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