Last week Twitter became the first social media giant to allow cannabis companies to advertise. Previously, only hemp-deprived topical products could advertise.
Twitter is the lone wolf among social media companies allowing cannabis companies to advertise. Other platforms like Facebook, Instagram, and TikTok have a no-cannabis advertising policy.
A statement from Twitter said only cannabis companies in the legal states would be permitted to advertise. As well, the ads can’t target anyone under 21 years old.
Is This Elon’s Doing?
Elon Musk, the eccentric billionaire who bought Twitter, is well-known for his 420 jokes. While there’s no evidence he’s directly involved with the policy change, he likely had an influence.
Officially, the position from Twitter is that since certain U.S. states have legalized, Twitter will relax their cannabis ads policy to “create more opportunities for responsible cannabis marketing.” according to Twitter’s head of ad sales, Alexa Alianiello.
Twitter’s new policy isn’t a free-for-all, however.
Approved ads can’t romanticize or glamourize cannabis use. As mentioned, the ads also cannot appeal to minors. Interestingly, the policy also prohibits advertising cannabis prices.
At least for U.S. advertisers, Twitter will not allow cannabis companies to show people using cannabis or under the influence. Twitter also prohibits U.S. advertisers from encouraging people to cross state lines or making misleading claims about cannabis’s health benefits.
Twitter will also not allow cannabis companies to advertise using celebrities and athletes as endorsements.
A Boon to a Failing Industry?
Of course, people will always consume cannabis. Whether Twitter allows cannabis companies to advertise or not. However, the market has seen better days.
“One overarching theme in the U.S., Canada and other markets is that cannabis businesses are struggling to compete with the illegal market, largely because of either lack of regulatory reform or inadequate regulatory reform,” says Jason Wilson, ETFMG Cannabis Research and Banking Expert.
“In the U.S., the lack of federal reform is burdening cannabis business with significantly higher operating costs and effective tax rates,” Jason said in an email to CLN.
In Canada, “onerous taxes and burdensome regulations are putting undue financial pressure on cannabis businesses.” Adding that “operators are struggling to compete with the significant (and largely unenforced) competition from the illegal market.”
Indeed, Canada’s licensed producer association is well aware of these facts. Some authorities aren’t interested in going after unlicensed pot shops. They’re targeting large-scale illicit grow operations.
But different authorities from different parts of the government regulate the hell out of the legal cannabis producers and retailers.
The result is a system where, as George Smitherman told CLN in the past, “The regulators and the lawmakers have nothing but attention for you.”
Fortune reported that the cannabis industry suffers from “excessive debt, falling marijuana prices, competition from illegal sellers, and high taxes.”
Twitter allowing cannabis companies to advertise may help keep the cannabis industry afloat.
It also helps Twitter fill in the ad revenue gap. Since Elon Musk has become the “Hitler-of-the-Month,” Twitter advertisers have grown weary, and some have dropped the platform entirely.
The “Hitler-of-the-Month” club refers to what independent journalist Matt Taibbi told Joe Rogan on a recent episode.
We’ve always done this with foreigners, whether it’s Noriega or Saddam Hussein or Milošević or Assad or whatever it is – we have a playbook for cranking out negative information about foreigners who get in our way, for whatever reason. But now we’ve kind of refined that technique for domestic people who are inconvenient. They did it with Trump, obviously. They tried to do it with Tucker Carlson, with you – you got a taste of that a few times – and with Elon, he went from being the guy who made electric cars sexy to something to the right of Viktor Orban in like 10 seconds. It’s amazing.
Twitter allowing cannabis companies to advertise may backfire. Since the anti-Musk campaign is still in full swing, it’s not out of the realm of possibility that more advertisers will drop Twitter because they feel “uncomfortable” sharing ad space with cannabis companies.