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Member Blog: What The Cannabis Market Can Learn From The Energy Sector About Overcoming Market Complexity
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Member Blog: What The Cannabis Market Can Learn From The Energy Sector About Overcoming Market Complexity

by Mike Elliott, Business Development Executive at DCM

In an industry where change is a constant, cannabis companies face big challenges when it comes to brand-building, communications, and bringing products to market. The sector’s complexity is only increasing, which is compounded by its continual evolution, along with tight, varied, fluctuating regulations, and in some cases, less-than-informed consumers. 

While the path forward may seem uncharted, in fact, similar market challenges exist in other verticals. With the right strategies and tools, these hurdles—including rigid regulatory conditions—can be overcome. If you’re looking for a roadmap for success, look no further than the U.S. energy sector – specifically, utilities. 

The recent shift toward deregulated electric and gas markets has created an environment strikingly similar to that of cannabis. Both sectors grapple with strict, unpredictable regulatory governance. Both must comply with state-by-state variances and prohibitive marketing. And both face the challenge of communicating with customers who are often unfamiliar with the sector’s legislation and production processes. 

By gaining an understanding of these obstacles, cannabis operators can improve their own market and regulatory navigation. Following are a few key lessons learned from energy.


  1. Changing regulations demand razor-sharp communications management

    For both energy suppliers and cannabis providers, regulation and compliance are determined at the state level. State-by-state laws vary widely and become increasingly complex when factoring in additional local and municipal regulations—not to mention continual review and change. This complexity has a direct impact on communications and brand management. Rules on communication and packaging—including, for cannabis, dosage—can diverge greatly and shift quickly. And there are few signs of this framework getting simpler.

Energy suppliers have addressed this complexity through variable, highly responsive communication platforms that can—very quickly and at scale—accommodate unique market requirements. 

For cannabis companies, similar success depends on razor-sharp management, including automation of intensive, often spreadsheet-based processes that are manually maintained and prone to error. Robust, technology-driven platforms can now deliver a wide array of materials efficiently and accurately across different markets, all while ensuring airtight compliance with each market’s specific regulations.

  1. New opportunities call for a fast, location-specific response

    Both energy and cannabis businesses must be agile and flexible when responding to new market opportunities. In adapting to fluctuating, state-by-state rules surrounding contract terms and conditions, energy providers have learned the hard way how inefficiency and error can delay market entry and reduce sales potential. 

Faced with similar circumstances, cannabis producers need the support of automated, location-specific marketing – technology that efficiently allows for customized, regional messaging across multiple markets and channels while ensuring locked-down branding and regulatory compliance. 

  1. Perception is everything when it comes to reaching consumers

    With deregulation, utility companies realized that many consumers were uninformed regarding the legislative changes and were unaware of product availability and their own ability to shop around. Educating consumers was key – and communicating to them a value proposition that would distinguish each provider’s offering from that of the competition. 

While cannabis is not entirely unfamiliar to many consumers, the dialogue around legalization and products remains similarly dogged by a lack of information and general misunderstanding. Cannabis companies must now shift those perceptions and educate potential customers on product safety and use. Producers must look at developing innovative communications supported by tools like automation, multi-channel communications management, and 1:1 marketing. These can help target, personalize, and monitor communications to better connect with consumers.

  1. With little room to communicate, companies need to get creative

    Utility companies are highly restricted in not only how they can make changes to billing and service charges, but also how they can market to consumers. The scenario is the same for cannabis companies, though regulations are even more complex and restrictive, with federal prohibition blocking most traditional means of advertising, including social and digital channels. 

Cannabis companies can combat these restrictions with genuinely creative thinking backed by a thorough understanding of the rules. That means combining market knowledge with creative expertise in a way that skillfully complies with regulations without breaking them. At the same time, creativity and customization cannot hinder efficiency. The right tools must be in place to make sure everything works together – for example, a platform that lets users customize branded collateral for different segments and channels, allowing for both efficiency and creativity – consistency and customization.

The bottom line: the stakes are too high for non-compliance

Fines for non-compliance in the energy sector can reach into the millions. Likewise, stiff penalties are levied for non-compliance in the cannabis industry. The financial implications can be devastating for cannabis producers – even more so if it comes to relabeling or pulling product from store shelves. To compound the risk, publicized mishaps can deliver a serious blow to consumer confidence for brands trying to win consumer trust.

With that in mind, navigating the highly regulated cannabis landscape takes careful planning, constant oversight, and the ability to stay ahead of evolving regulatory requirements. While the opportunity is promising, it requires tools, technologies, and strategies that streamline processes, mitigate risk, and increase speed-to-market. Charting your course depends on careful planning, trusted advice, and experienced partners – along with the ability to learn from those who have been there and done that. 

Mike Elliott is a Business Development Executive specializing in cannabis at DCM

From brand strategy and consumer insights to dynamic labeling and POS solutions, DCM helps build, protect, and bring to market North America’s largest cannabis brands. Learn more at

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