Cannabis Industry Shows Signs of Growth at NCIA
Nov 02, 2018 Anne Baker
Close your eyes and conjure a picture of a cannabis conference. What do you see? Is it a group of 20-something men in tie-dye? Where is the conference? What’s the agenda?
Whatever you’re picturing, I’m willing to guess it wasn’t the reality of the annual National Cannabis Industry Association’s (NCIA) California Cannabis Business Conference, the organization’s dominant event. Held last week in the Hilton Ballroom in Anaheim (steps away from Disneyland), the location itself was a clear indicator that, for the cannabis industry, times have definitely changed.
Only a few years ago, it would have been difficult for the majority of Americans to imagine a cannabis conference as a sea of men and women dressed in suits or the Patagonia fleece vest/collared shirt/jeans uniform that has come to dominate Silicon Valley. But that’s exactly what NCIA’s big annual show has become. That shouldn’t come as a surprise; after all, cannabis is now fully legal for adults in Canada and legally accessible to the majority of Americans in some form. While exciting, it is not without its tensions, many of which were evident at NCIA.
Here are three key takeaways:
A bumpy transition to a legal market.
One of the most notable speakers at NCIA was Lori Ajax, chief of California’s Bureau of Cannabis Control. Ajax was greeted by the crowd somewhat warily. California, like other states that have legalized cannabis for adult use, has struggled with issues relating to licensing, supply, and the unintended consequences of tight regulations. For example, our client Eaze spoke to Fast Company earlier this year about Prop 64’s negative impact on non-profits that donate cannabis to low-income medical patients.
Some of the bumpiness can be attributed to staffing shortages: the Bureau is still hiring for more than 70 open positions. But the most top-of-mind issue for licensed dispensary owners seems to be the illicit market, which is, unfortunately, still thriving. That’s problematic for dispensary owners who, in addition to competing with the illicit market on price and taxes, have to contend with onerous state regulations on everything from child-proof packaging to batch testing - and face stiff penalties for non-compliance. Ajax’s message: the state recognizes the challenges facing dispensary owners and is going to work harder to curb the illegal market (more on that in a minute).
Who “owns” the industry?
One of the more interesting panels included two of the more recognizable faces within the cannabis industry: Steve DeAngelo, founder and chairman emeritus of Harborside Health Center, the iconic Oakland dispensary, and Melissa Etheridge, the… rockstar (also iconic).
While the topic of the panel was the “mainstreaming of cannabis through culture,” the conversation primarily centered on how the cannabis industry has evolved and who shapes its future. Cannabis is expected to be a multi-billion dollar industry for the United States over the next decade, but until relatively recently, it’s operated in the shadows. What happens to the people who started the movement that so many are now benefiting from financially? As DeAngelo movingly reminded the audience, California became the first state to legalize cannabis for medical use as a direct result of the AIDs crisis and gay liberation movement. “[Cannabis] is a gift back from the underground to the mainstream,” he said. There is a strong desire by many of the industry’s leaders to pay tribute to the counter-culture history that got us here while balancing a need to wash away many of the “stoner” stereotypes that stigmatize cannabis use (neither DeAngelo nor Etheridge are fans of Netflix’s “Disjointed” series).
But both acknowledged that the steady progress toward full legalization, and resulting business boom, is both inevitable and a good thing. “Look at all these people,” Etheridge said, gesturing to the audience. “These are amazing people. They’re here to learn - they want to know. They’ve been in other industries and now they want to do this.” The opportunity now is to make cannabis the billion dollar industry that does things differently and champions inclusivity, positivity - and women (“It’s a female plant!”). “We can be the industry that sets the example for all other industries,” Etheridge said.
Normalization is coming (in California).
There is no question that the industry’s growth, both legal and commercial, is dependent on the evolution of American perception about what cannabis is and who it’s for. Professionalism, quality assurance, and appealing branding are all critical to that effort. The State of California is planning to do its part to educate consumers. Lori Ajax announced that the state would launch a new public awareness campaign in January designed to educate the public about cannabis and where to buy it - legally. There is $2 million earmarked over the next two years in the state budget for public education, so January is merely the first step in a more knowledgeable, confident cannabis-buying public.
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