American Hemp Manufacturing

American Hemp Manufacturing PART V: Marketing Hemp Products

Just like alcohol, clothing, and just about every other consumer product category, the money is in private labeling.

Why does the label make a difference? Why do you buy Levi’s for $50 when Costco’s Kirkland brand sells the same style and cut for $10?

For all we know Kirkland brand jeans could very well be Levi’s with a different tag sewn into the waist.

Just like we have preferences when it comes to purchases, like jeans, customers are already aligning themselves with Hemp-Based CBD brands.

With reports, like this one, about mislabeled Hemp-Based CBD products you can see why customers would want to pick a brand they trust and stick with it.

That Penn State study found over 70% of the CBD products they tested were either over or under labeled.

So how can you work on establishing your brand so you don’t end up misleading your customers?

The best way to make sure you’re giving your customers an honest product is to partner with a U.S. based Hemp-Based CBD manufacturer.

Why should they be domestic? China is one of the biggest exporters of hemp in the world. Why not take advantage of it?

Hemp and hemp products are on the list of Chinese imports that incur a 25% tax upon entering the U.S.

Not only will that eat into your margins, but you also have no way of knowing the quality of your product.

This is why so many CBD and hemp products are mislabeled. When suppliers scrape hemp from any farmer with supply, they end up not knowing the real contents of their product.

You could end up with a batch of a product just over the legal limit of 0.3% THC. If your product tests over the limit, chances are you won’t be able to send it back to your Chinese supplier for a refund.

An established American CBD manufacturer like Spring Creek Labs, provides a unique advantage over new start up manufacturer. A new manufacturer may patner with a hemp farmer in China and have no idea what they have been sold for porduct.

Having established relationships with US-based farms for years means you know whats in your product. Ownership of the entire manufacturing process means no outside vendors or distributors touch the finished product before your customers.

Hemp-Based CBD Stores

Deciding where to sell your Hemp-Based CBD brand can be a challenge. Some of the biggest ad platforms, Facebook and Google, have strict policies in place against companies selling CBD products.

Facebook has started to loosen its restrictions by allowing topically applied CBD products, like lotions.

But that doesn’t help if you’re selling Hemp-Based CBD softgels. So how are Hemp-Based CBD companies getting new customers to experience their products?

One way is to stock your products at a traditional storefront. Most CBD products with a brick and mortar presence target health food stores and marijuana dispensaries.

But there’s a new trend in cannabis retail: CBD only stores.

You heard that right. An entire store devoted to CBD.

Green Growth Brands operates CBD product stores in hundreds of malls across the country.

They’re on track to have 280 stores open by the end of 2019 alone. What is their secret to immense success in the CBD industry?

They have a bulletproof business model. They stock their stores with a smattering of in house brands they’ve built from the ground up as well as outside brands.

By private labeling, they’re able to reap huge profits while building a loyal customer base.

Mainstream Retailers

Sephora and Abercrombie & Fitch, both American mall mainstays, are both making deals to sell CBD products in their stores.

And both are great examples of how CBD companies are using classic marketing principles, like product positioning, to enhance their brand image.

Sephora has already started selling pricey CBD lotion brand, Lord Jones. At over $30/oz, Lord Jones makes one of the most expensive CBD products on the market.

Assuming they’re using a reputable Hemp-Based CBD manufacturer, is the high price worth it?

To customers, perceived value is everything. Harvard business professor Gerald Zaltman says there is one thing that remains the same when any new product is introduced, regardless of the industry.

“No matter how radical a new product is,” states Zaltman, “it will always be perceived initially in terms of some frame of reference.”

What is old professor Zaltman talking about? He means that even a product, like CBD, that many consumers aren’t familiar with will incite the need to make it familiar.

For example, a soccer mom passing by a Green Growth Brands store in the mall thinks to herself, “this is just like The Body Shop.”

So how can you create a feeling of familiarity for customers who have yet to experience your Hemp-Based CBD brand?

Brands, like Green Growth, present the image of enjoying their products in nature.

CBD retailer Kush Queen loads their Instagram feed up with soothing pictures of foamy bubble baths and fresh salad recipes dredged in CBD salad dressing.

These brands know CBD customers aren’t just looking for easy ways to incorporate cannabinoids into their beauty regimens.

Women make up the majority when it comes to CBD customers. Consumer research shows women tend towards non-intoxicating substances, like Hemp-Based CBD, and that they’re also more interested in overall well-being on average over men.

Even Pets Can Be CBD Customers

Don’t forget about one of the biggest markets when launching your CBD brand: pets.

Pet owners who use CBD products regularly are looking for their dogs and cats. A dog’s life is all about belly rubs and treats. What better treat than the biggest trend right now for a pet lover to give.

Forecasters of the hemp industry say up to 10% of hemp products could be in the pet department soon.