Alex Wang is a man of many paths, some traditional and some not so traditional. Alex is a trail blazer for Asians in cannabis, from his founding of Washington Tower Farms to marketing for WPP in Shanghai, China. I have found many more open minded Asians in the age group 21- 40, maybe it is because they are first or second generation here in the US and Canada and more attuned to the zeitgeist of their generation and not their parents. As we move forward to the expansion of the legal cannabis market, more will see it as a playing field that they can enter with less stigma because of people like Alex who "look like them" and are not what the stereotype that they have been led to believe, ironically as a minority we are just as guilty of stereotyping and marginalizing others.
Do you see segmentation in the marketing of cannabis for different genders and ethnic groups? Great question, HUGE topic.
Because of the current legal absurdity in US, cannabis is still a very fragmented market. Firewalls on state lines and licensing limitations have kept the players in the industry to small and medium size enterprise levels. In turn, marketing for cannabis brands also stay on the same level. Almost no brands have the scale and resources to any significant brand building. This is good in the sense that no single entity is controlling the representation of cannabis in the market. So the opportunity for diversity is ripe!
However, marketing is not sophisticated in cannabis as it is in more matured industries. It’s usually an afterthought for most cannabis companies. So people end up doing the same thing. If you go into a dispensary 95% of products use the same type of packaging and ½ of them barely put any effort into design. This also leads to brands staying with the old familiar target groups as their audience: the ol’ “stoners”. Bad for diversity.
Luckily, things are changing, fast, due to 3 factors:
- The market is getting crowded! When the legal flood gate first opened, all you had to do were produce a decent product, become bros with the dispensary owners and budtenders, and wait for the cash to flow in. Now there are 1000s of SKUs at the point of sale, each nug looking sexier than the next. It’s time to differentiate. Suddenly packaging design makes a 50% difference in your sales, channel management is top of your priority list. If you don’t do anything different, you better lower your price! Or if you want your business to stay profitable, find a niche and stay out of the price war bloodbath.
- The market is expanding! Legalization and gradual warming up to cannabis in the mainstream has brought new users and brought back ex users (people who used cannabis in college but just couldn’t be bothered once real life kicked in). in 2016, consumers in their 20s made up of 37% of the market. Consumers in their 30s made up 27%, BUT they spend 50% more in comparison. To the emerging segments (new users) are older and tend to have more income: mainstreamers. They have jobs, kids, mortgages, the whole 9. Traditional way of designing products for “stoners” won’t appeal to them as much.
- Weed people are smart!
- Weed people have to navigate through rigorous government red tape and bureaucracy just to get the permission to set up shop. And then comply with regulations fit for plutonium production.
- Weed people have to build their facilities using unproven technology and build as we fly
- Weed people have figured out how to cultivate a complex plant, maximize its potential, and go through intricate extraction or processing methods to come up with high quality products with little to no scientific study available.
- Weed people will figure out how to adapt themselves to the changing market.
To answer your question (finally):
I see an overall trend towards making products/ brands more relevant for emerging segment (mainstream). This is great in that it has brought better product and packaging designs, focus on discretion, portable consumables… all leading to better user experience overall. With the rise emerging segments, we are also seeing brands paying more attention to more traditionally niche groups:
- Gender: there is definitely better representation for female consumers on the store shelves now. The split in consumption by gender in 2016 is 70/30 skewed towards male. I would say just a couple years ago, products that cater towards women are way under indexed than that 30%. Now it’s gradually changing. Whoopi built her products and brand around alleviating feminine issues, many more smaller names followed suit. Edibles and vape pen categories are steadily eating away market share from flowers, and they’re heavily targeted towards females.
- Ethnicity: I haven’t been able to see any data on this, so everything here is purely anecdotal. I haven’t seen any brands targeting specific ethnic groups, yet. But for me, personally, I don’t see a point. I think Americans focus too much on race and ethnicity already. There isn’t inherent differentiation in needs for cannabis from race to race, or shouldn’t be. I much rather see cannabis be a unifying factor than a divisive one. As the market matures, I think it would be more interesting for more niche and interesting target groups being represented e.g. cannabis products for people that love ramen and want to enhance the experience. Guess who loves ramen, EVERYONE!
What was your first experience with cannabis?
Junior year in high school. Ditched school, hung out my at house with a few buddies. The guy that busted out a joint was a decent student and a good athlete. So I figured it can’t be THAT bad. It WASN’T!
Fun fact, my neighbor (who also went to our school, and also ditched that day) came back and invited us to watch porn on his computer. This was during AOL days so access to porn was more limited than weed, so we said “sure”. Watching porn, high for the first time wasn’t great. The repetitiveness of the motions and sounds was distracting to say the least. Also watching porn on a CRT monitor with a bunch of dudes isn’t that fun. I remained a social toker until my early 30s. Haven’t watched porn with other dudes since then.
When the major ad agencies enter the cannabis market, do you see a “vanillization” of cannabis?
I think we will definitely see a vanillization of cannabis. It’s already happening. But agencies won’t be the only culprit. I worked for agencies for a long time. The work is only as good as the brief. Vanilla work come from briefs that have no insights. Just like any other industries, people that don’t know the business, the industry, and the customers well will produce shitty briefs. And agencies won’t be able to fix that. They will default to proposing safe solutions they’re comfortable doing. They get paid either way.
As we enter the mainstream era for cannabis, this is bound to happen. Vast majority of brands will do what everyone else is doing. But as mentioned above, there will also be those who seize the opportunity to differentiate. Out of the mass pile of poop, magic will rise!
If you had to come up with a tagline to sell Cannabis to Asians, what would it be?
Edibles: “tell your parents it’s a vitamin”
How does your family view your business involvement with cannabis?
My parents are way traditional. My wife is Chinese Chinese, so she doesn’t really get it either. When I first told them I’m going to quit my job and go grow marijuana, it didn’t go well.
It’s a task of education:
- For my parents I sent 2 articles: Sanje Gupta piece on CNN (Chinese parents trust CNN). And a study on known medical properties for cannabis. They were ok after that.
- For my wife, I showed her our financial projections.