Op-ed: CANN This Work?
The early days of CANN, the cannabis beverage that's re-imagining social drinking. Inside perspective into how it's muscled its way into early exponential success -- Part 1.
In 2012, my high school math teacher brainwashed my class into learning the quadratic equation. Six years later, he turned math into weed and became my boss.
I had always stayed in soft touch with Luke Anderson — happy birthdays and professional congrats on LinkedIn, mostly. But July 2019 was the first time we re-connected and when he offered me a role at CANN, a microdose cannabis beverage that had just raised money and was gearing up for a California launch on Eaze.
The concept was exciting. Almost 80% of US adult drinkers want to reduce their alcohol intake, but no real alternatives existed, not even in cannabis where micro-dosing seemed to go against everything the legacy market had been preaching for more of, flower.
And it was (and still is) federally illegal.
This was risky. I remember going through the LinkedIn profiles of the people who had just joined, trying to gauge if they were equally crazy enough to have gone full-time into an unproven idea. I had questions.
Sure cannabis had lots of long-term potential…but a beverage?
Does it taste, like, weed?
Why are they so small?
Only 2mgs THC?
CBD too?
Has anyone done this before?
Eventually, I said f*ck it — I wanted the experience to do something different. I believed in the team and had zero doubts about the product so I joined in 2019 as employee #9 working in operations, though eventually moved into a sales and new market expansion team where I spent the remaining two years.
Today, CANN is pioneering the infused beverage space and redefining what a beverage brand within cannabis can be. While the industry is choking from over-regulation, CANN continues breaking YoY sales records, expanding into new states, and attracting all sorts of new consumers into dispensaries.
Even my dad became a FANN.
Having the chance to work in sales and new markets gave me exposure to new dispensary products, working with retailers in San Diego, Orange County, Los Angeles, San Francisco, Sacramento, Sonoma County, Las Vegas, and Reno.
But it didn’t matter the market, beverages were scarce and short-lived. According to Headset, the median lifespan of cannabis beverages is only about ten months.
I was and am still rooting for other infused drinks to help grow the market, but new operators have underestimated the amount of homework and preparation it takes to build a truly great product inside cannabis; one that tastes great, achieves functionality, and has relatable branding, not to mention the extra costs and labor from industry compliance.
Aluminum Cans
Childproof Lids
Cardboard Trays
Flavors
Juices
THC/CBD
Shrink Sleeving
Packing/Sorting
Canning Line
Lab Compliance Testing
And since beverages are still fighting for dispensary sales with heavy customer incentives that are eaten by operators, margins further compress.
A good Harvard Business Review piece breaks down common mistakes with product launches.
Mission Oriented Team
CANN had an incredibly smart and high-pedigree team. Both Luke and Jake met at Harvard Business School while other execs had jumped ship from leadership roles on Wall Street and Big Three firms to join in early 2019.
But pedigree didn’t solve everything, the opportunity to build something that no one had ever done before — THAT was it. It was different and created a sense of responsibility that pushed us to stand outside Barry’s and ask gym goers to pinky promise to buy our product on Eaze, to camp outside dispensaries for hours to get five minutes of a dispensary buyer’s time, to spend seven days a week pitching samples inside shops while passing samples out of a branded trike.
Selling into stores where consumers don’t even know beverages exist, let alone a micro-dose seltzer became grueling. Beverages are typically only 1-2% of dispensary sales, assuming they’re even sold.
But struggle created relatability that forged bond — it helped make the team relentless.
We didn’t just pitch a new buyer on the product, we pitched them on how we’d sell it. Launch week. Week 1. Week 2. Week 3. Customer incentives. Budtender incentives. BOGOs. Partnerships with other brands. SMS and email blast campaigns. Daily store pop-ups with undosed samples. Raffles. Display builds. Merch incentives. Gift card incentives. Dominos, iced coffees, donuts. I’d offer my own cash to get us in.
We’d find a yes.
I was out of my league coming into sales for the first time, but after a few stutters at my first pop-ups/samplings, it became crisper and I developed a rhythm. I’d deliver the same pitch, hundreds and thousands of times to dispensary customers; and it kept getting better.
I’d never ask for anything to start the pitch — only a free sample. I offered value in exchange for nothing, and once they tried it, they turned into layups. Nine out of ten times, I’d get the same or a similar overwhelmingly positive reaction:
“WOW, what is this??!”
I hope some of these stories and lessons can help current and future industry operators, especially new products and brands.
TL;DR
Take Your Time to Launch A
GoodGreat Product. The industry already has enough regulation challenges, don’t just build a brand and assume the Green Rush will do the work— do your homework, and obsess over R&D, and consumer feedback.Mission-Oriented Team. More enthusiastic and passionate early employees forge a culture, and a strong culture inspires employees to consistently engineer solutions when typical answers don’t exist. Don’t just hire on experience and intelligence -- everyone’s still writing the playbook in cannabis.
Design and Branding Matter. Be meticulous about every detail in packaging and brand aesthetic. Typography, color palettes, color contrasting, values. If a cannabis product is going to eventually compete against Whole Foods products, branding should appeal to as many consumer demographics as possible, not just binary (canna-curious/low dose vs legacy/heavy flower consumer).
Focus on Sell Thru. There’s only so much floor space (not to mention fridge space) in a dispensary, so how fast you can push product matters more than how many stores you can get into after launch. To increase same-store sales, deepening your relationships with buyers becomes a big advantage since it gives you priority and mind-space to run more marketing campaigns and activate more sell-thru promotions to keep products churning out the door. Have sell thru plans when you do sell-in to a buyer, not just a product and a sell sheet.