How Cannabis Businesses Are Reinventing Traditional Business Rules

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It’s an understatement to say it’s been a dramatic decade for the cannabis industry. We’ve all watched the rapid evolution from its humble beginnings to something with real scale, sophisticated operators, and accelerating consumer adoption. As state after state legalizes the sale of cannabis products, the dynamics that drive the entire supply chain—from growing and manufacturing to packaging, marketing, and sales—have begun to emerge from the shadows and take familiar shape as they slide into well-known, tried-and-true paradigms.

When it comes to mainstream consumer products, success is about streamlining operations, understanding how to differentiate in a competitive landscape, and developing creative marketing and sales tactics to rise above the noise.


Cannabis is now ready to play the same game as any other packaged product when it comes to gaining brand loyalty—driven today by social media and a primarily digital marketing ecosystem. After all, brick-and-mortar physical shelf space and online attention are at a premium in every sector and cannabis is no exception.

So, how should cannabis companies balance traditional business rules with their eagerness to break new ground and set their own pace?

Interestingly, traditional fast-moving consumer goods (FMCG) brands are struggling specifically because of the dominance of e-commerce for instant—and often automated—comparison shopping and price-hunting…and also because of the rise of the Millennial. One of the dominant traits of this generation is the desire to explore, test, compare, and jump from brand to brand with little allegiance. They demand first-hand experience, personalized engagement, and bottom-up reviews, not top-down, ongoing streams of pompous claims.

Mass-market brands always have relied on core value proposition messaging and ongoing marketing campaigns to cultivate and retain an audience. Today, these companies find themselves in a world of metrics, analytics, and empirical data that can—and must—drive each move. But many resist the approach in lieu of their own perceived “expertise” in knowing what the public wants or expects.

Unencumbered by the historical baggage with which traditional brands struggle, cannabis brands are eagerly embracing these dynamics. And with ongoing and pending growth unrivaled by other industries—projected annual sales rising from $20 billion in 2021 to $40 billion in 2025 and east coast legalization on the way with a likely compound annual growth rate of almost 50 percent—there is a lot at stake.

Homing in on Houseplant

Seth Rogen and Evan Goldberg’s brand, Houseplant, is an excellent example of a company leveraging and reinventing traditional playbook dynamics. The Houseplant brand got its start in Canada (which makes sense as it was the first country to legalize) and is only this month making its way to California. Let’s take a look at how some of these guidelines apply to the brand’s recent expansion.

Houseplant launched with the advantage of built-in star power from Rogen. Interestingly, he didn’t inject his name into the product name itself, indicating a level of confidence by which he implies the brand can stand on its own merits. More interesting, the company also is producing a line of completely stand-alone home goods that can extend the brand more broadly. The two branches of the business have been carefully separated on social media to prevent restrictive cannabis marketing policies from limiting the latter’s ability to build a brand recognition base. Beyond the Houseplant name, the closest the two come to connecting is a series of vinyl records featuring the names of three cannabis strains (sativa, indica, and hybrid). The company is cleverly building one brand with a parallel, essentially unrelated product line.

Rogen’s company is innovating not so much in the actual product, but in the packaging. Using a retro, mid-century style with color-themed, log-stamped tins, the products stand out in a way they never could in Canada, where regulations are extreme, limiting, and difficult to implement when making any differentiating visual impression. In addition, Rogen is borrowing names from his film Pineapple Express as an out-of-the-box strategy to get away from using only strains as product designation. Names like Pancake Ice Sativa certainly will draw attention.

Sales are more easily achieved once the demand is clear, and retailers see the logic (i.e., the profit) in promoting a specific brand. Houseplant is beginning with a direct-to-consumer (DTC) play to build that demand, and with Rogen’s social media following alone, the company should have an easy time attracting customers to an online store. I’ll assume the DTC approach is not a long-term strategy as it does require overhead, and shipping cannabis is complex due to border/regional regulations even within a single state. In addition, real-world shelves are sure to offer a more appealing stage for the brand’s dramatic packaging. We will see the progress with time.

Houseplant also is appealing to Millennials by jumping onto the social- and ethical-policy bandwagon, emphasizing its desire to drive impact on the world way beyond its commercial goals. The company is actively engaging with non-profits seeking drug policy reform (it’s well known that drug laws disproportionately penalize minorities), as well as mentoring entrepreneurs in the cannabis space—the young, creative go-getters who can help innovate the market.

It’s clear Houseplant is not looking to be “just another cannabis supplier” vying for attention and a tiny slice of market share. The brand’s strategy harnesses the traditional playbook but amplifies many of the tactics implied there as best practice. In seeking an upscale consumer base, the brand already is differentiating itself. There are plenty of other challenges that will help or hurt the company (product expansion beyond flower, delivery logistics and scope, breaking into brick-and-mortar retail, etc.), but if these all are handled with the same creativity and not a business-as-usual approach, the future is bright.


Cy Scott is co-founder and chief executive officer at Headset, Inc., turning retail data into real-time cannabis market insights. He provides industry analysis and insights about innovative brands through his weekly blog, Cannabis Packaged Goods. Prior to founding Headset, he co-founded Leafly and helped grow the site into the world’s leading cannabis information resource. Along with his work at Headset, Scott founded a monthly Cannabis Tech Meetup hosting cannabis entrepreneurs and technology developers that has expanded into multiple regions throughout the U.S. Scott’s favorite strain is Tangie.