Twitter Bolsters Charm Offensive With Cannabis Advertisers

April 26, 2023 · WSJ

Twitter relaxed its rules on the types of ads U.S. cannabis companies can run on the platform, less than three months after accepting them as paying customers for the first time. 

Companies can now feature their packaged cannabis products in their ads. Previously they could advertise their businesses and link out to websites but couldn’t depict the actual products they sold. The company has also increased the number of states where advertisers can target consumers for medical and recreational cannabis.

The new rules reflect Twitter’s recent sales strategy of working closely with cannabis companies, many of which have praised the company’s attentiveness but bemoaned the long, stringent and sometimes unclear ad-buying process.

After some of Twitter’s biggest advertisers in sectors from consumer-packaged goods to air travel paused or reduced spending on the platform following the company’s sale to Elon Musk, Twitter in February announced that it would let some U.S. cannabis companies buy ads in a loosening of policy not before undertaken by a mainstream social-media company.

But some cannabis executives said the policies announced in February were perplexing: Cannabis companies were allowed to buy ads, but they weren’t allowed to explicitly promote the sale of cannabis. That posed a conundrum for cannabis marketers, who often have small budgets, prize product marketing over brand marketing and need to prove strong returns on investment to leadership and investors, said Jon Lowen, the co-chief executive and co-founder of Surfside, a digital media and first-party data firm that works with cannabis advertisers.

“A lot of people [in the cannabis business community] were citing the actual policy that Twitter published, and saying, ‘You really can’t advertise anything here,’” said Adam Terry, chief executive and co-founder of Cantrip Seltzer, a hemp and cannabis-infused beverage company. 

“It gets really complicated to advertise if you can’t actually mention that you sell something,” Mr. Terry said.

Opening the Gates

Alexa Alianiello, Twitter’s cannabis sales and partnerships lead, said in a tweet Tuesday that the recent changes were implemented in response to cannabis executives’ requests. “We listened, and updated our ads policy,” she wrote.

Cannabis advertisers for years have argued that they should be able to advertise to adults online in states where its sale is legal. Technology companies historically haven’t agreed. 

Only a handful of digital advertising brokers and media companies accept cannabis companies as clients. Facebook and Instagram parent Meta Platforms Inc. and Alphabet Inc.’s Google prohibit the advertisement of most cannabis products, although Google in January relaxed its policy to allow ads for some products made with CBD, a cannabis-derived substance formally called cannabidiol. 

Twitter has approached the nascent industry with gusto since cracking the door open to its ads. 

“Twitter has your back,” Ms. Alianiello told a room of cannabis business founders and investors earlier this month at the Benzinga Cannabis Capital Conference in Miami.

Ms. Alianiello’s appearance was unusual: Since Mr. Musk bought Twitter, the company’s executives have rarely been put in front of an audience, in person or remotely. External communications have largely comprised Mr. Musk’s own Twitter feed and media schedule.

Delivering an empathetic keynote reflected Twitter’s strategy to go all-in on wooing and supporting cannabis companies, a move some say is working.

“I get texts and emails back [from Twitter] within a matter of minutes. It’s been really refreshing,” said Amy Larson, senior vice president of marketing and communications at Tilt Holdings Inc., a cannabis brand holding company.

“They obviously put a lot of thought into the program and have been very responsive,” said Kate Lynch, executive vice president of marketing at Curaleaf Holdings Inc., a dispensary chain, which began running ads on Twitter in February.

Ms. Alianiello has taken to replying directly to those cannabis advertisers on Twitter whose experience hasn’t been so smooth.

Common complaints include the rejection of ads’ messages on the basis of Twitter’s cannabis ads policy without a clear explanation.

Raveena Cheema, chief marketing officer of cannabis accessories company Purple Rose Supply, used Twitter’s self-service portal to submit ads when the company’s policy changed. The ads were never approved, and Twitter’s ads support team told her in an email that the ads she submitted violated its drugs and drug paraphernalia policy. But the email didn’t specify how.

“The answers I get back are very vague and automated, it seems like, and I can’t get in touch with a human that can help explain,” Ms. Cheema said. “It’s so much work to go through that it makes more sense for us right now to put more attention on other channels, rather than trying to help Twitter navigate this space.”

Cannabis companies interested in advertising with Twitter hit another stumbling block this month: The platform said it would temporarily only accept new cannabis clients if they commit to spending at least $5,000 per quarter on ads. The threshold was put in place to help Twitter sift through the backlog of cannabis companies waiting for the platform to manually certify their licenses, Ms. Alianiello wrote on Twitter.

Navigating the Policies

Despite the update to its policy regarding product-specific content, Twitter still prohibits cannabis advertisers from using common direct marketing phrases such as “10% off” and “click to buy.” 

Cannabis companies who wish to advertise on Twitter must validate that they are licensed by appropriate local authorities, fill out an attestation form and submit their proposed ads for review. Ads cannot appeal to minors, make claims about health benefits or depict people under the influence, among other rules, according to Twitter’s guidelines. 

After the lengthy submissions comes a waiting game, cannabis advertisers say.

“In my conversations [with a Twitter account manager] he said, ‘If money starts coming out of your account, then you’ll know it’s been approved,’” said Tilt’s Ms. Larson. Tilt next month plans to run Twitter ads for its Jupiter vaporizer business, and hopes to run ads for its Commonwealth Alternative Care brand of cannabis in Massachusetts as soon as possible. 

Some companies have bumped up against fine print obstacles.

Cantrip, the cannabis soda brand, began spending around $600 a month on Twitter ads in February and increased the figure to $8,000 in March, but found the technology that tracks how ads lead to sales wasn’t working properly, Mr. Terry said. Cantrip upped its spend again in April, but found its ads had been halted just before the unofficial cannabis holiday on April 20 because they included a call to action, according to Mr. Terry. Such language isn’t permitted in the Twitter ads policy, but Mr. Terry said that is not explicitly stated. 

Cantrip submitted new ads featuring its soda cans when the policy regarding images changed, Mr. Terry said. But those too were deemed noncompliant. The reason? The image showed liquid splashing out of one of the cans, and Twitter’s updated policies dictate that cannabis advertisers can’t show their products out of their packaging, Mr. Terry said.

Cantrip is considering pausing all its advertising on the platform until it is confident Twitter’s policies won’t change again soon, he said.

Other companies have had better luck. Curaleaf pulled an animated background from one of its Instagram posts and repurposed it for Twitter as soon as the company’s drugs advertising policy changed in February, according to Ms. Lynch, the marketing chief. Twitter approved its first round of ads within 24 hours, she said.

Curaleaf saw its Twitter followers increase fourfold since it began paying for ads, and earlier this month began its second round of advertising on the platform, Ms. Lynch said. 

“But at the end of the day, our goal is to drive sales,” she said. “So we continue to work closely with the Twitter data and our own e-commerce data to see how much of this is actually converting.” (Full Story)

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