Marijuana is used in recreational and medical purposes in many states of the U.S. and Illinois has recently legalised the use of marijuana which had a great turn over in the marketplace. Marijuana has a huge demand in the market which has significantly increased the sale after its legalisation. Earlier, similar turnover was noticed when cannabis was legalised in Colorado and Massachusetts; the shoppers in these states spent over $400 million on this product after its legalisation in 2014 and 2016 respectively. In Illinois, more than $20 million worth of product was sold to the shopper within two weeks of the legitimisation.
Though marijuana is legal in 11 states for adults over 21 and legal for medical use in 33 states, it is still considered illegal at the federal level. This legal conflict affects the market for marijuana. Keith Smith, an assistant professor of Marketing at Northeastern University, published a study based on the marketplace and the clientele of cannabis production, who had also mentioned that it is a great plot for marketing research scholars. He enlightens on the disadvantages of the contradicting federal rule over marijuana sale in the U.S. He says that this mismatch has created “a patchwork marketplace, where marketing tactics you would traditionally take for granted can’t really be done”.
Keith’s research shows that the most important marketing medium of the 21st century, i.e., the online advertising sites is out of the bound of the cannabis sellers because of the Controlled Substances Act which inevitably limits the reach of this product resulting to decrease in demand. Furthermore, cannabis companies are debarred from accessing the traditional banking system as the federally insured banks are forbidden from handling money regarding any illegal drug sale. Also, this product is only allowed to be cultivated, produced, and sold within the bounds of the state where it is legal which affects the quality of the product.
Such challenges offer a rare space for marketing scholars and Smith calls out his fellow researchers to take advantage of this to help cannabis firms in the long run.
Rubena Bose