The Ultimate Guide to Programmatic Advertising for CBD & Cannabis

What if you could show ads for your products to any cannabis shopper who visited your
competitor’s store? Or get your audio ads heard by yoga enthusiasts in a certain shopping mall?
Or target your B2B campaign at local businesses most similar to the ones already in your CRM?
Believe it or not, these are things you can already do with programmatic advertising
technology—the thing is, most cannabis and CBD marketers don’t even know what
programmatic means yet. Let’s jump into that part first.
What Is Programmatic Advertising?
As MarTech Advisor defines it:
“Programmatic advertising is the real-time buying and selling of ad inventory through an
automated bidding system. Programmatic advertising enables brands or agencies to purchase
… ad slots for digital out-of-home (DOOH), online, streaming, TV, video and voice ads.”
Over the last decade, digital ad spending has jumped from ??? billion to ??? billion per year.
Today, about 70% of digital ads are bought and sold using programmatic ad tech, which
automates the negotiation and purchasing process to let sales happen in a matter of
milliseconds. Rather than having to buy ads individually ahead of time, programmatic platforms
now connect advertisers with hundreds of thousands of available slots instantaneously, while
algorithms help purchasers decide where to run ads, when to show them, and how much to pay.
These platforms also aggregate data from a huge array of providers, which lets advertisers
choose their audience by attribute—long-distance runners ages 21 to 30 living in Sandton with a
known interest in CBD, for instance. For any brand looking to get a leg up on the
competition—particularly in a fast-moving industry like cannabis—the benefits of leveraging
programmatic are numerous.
Why Use Programmatic Ads for Cannabis and CBD?
Programmatic platforms are invaluable to cannabis and CBD businesses looking to advertise
digitally because they offer an alternative to Facebook and Google, both of which have policies
of rejecting cannabis ads. While these platforms, together known as “the Duopoly,” account for
about half of the digital ad spending, programmatic platforms unlock ad inventory across the
other half of the digital ad sphere. Huge numbers of high-traffic, mainstream sites will accept
programmatic cannabis ad buys.
Which programmatic platform to use depends on whether you’re a plant-touching or
CBD-specific business: Both industries are able to run display ads on mainstream websites,
they just use separate services to do so. Cannabis and CBD brands as well as ancillary
businesses are able to use mainstream programmatic technology: At Smarterthinking, we help
our CBD clients run ads through our The Trade Desk. For all other cannabis brands, it’s
currently best to use a cannabis-specific ad buying platform; at Smarterthinking, we partner with
Safe-Reach for this purpose.
Each programmatic advertising channel offers unique benefits and capabilities for cannabis
marketers: Learn more about the features of individual channels below.
Display Ads for CBD & Cannabis
Digital display ads are already transacted almost entirely through programmatic ad tech: This
year, 85% of them will be purchased programmatically. If you’re running display ads for
cannabis or CBD, programmatic ad buying is a must.
One of the best things about running programmatic display ad campaigns is the ability to A/B
test distinct ad sizes, reallocating resources in real time to the ones with the highest likelihood of
conversion. For example, if early results of your campaign show that vertical banner ads are
twice as likely as horizontal ones to drive clicks to your website, you can decide to pay twice as
much for a vertical banner ad impression, and only half as much for a horizontal one.
Mobile Ads for CBD & Cannabis
According to Inc., the average person spends more than four hours per day on their mobile
device, meaning mobile ads are a must in any industry. When building programmatic mobile
campaigns, businesses can target based on mobile activity—for instance, people who’ve
downloaded cannabis apps like Digital Dope or Canniest Club.
Another popular mobile marketing technique is known as geofencing: Using mobile data,
cannabis and CBD advertisers can target adults near certain locations that may be relevant to
their campaign, such as music festivals, industry events, or competing cannabis stores.
Native Ads for CBD & Cannabis
Native advertisements are ads that blend into the surrounding content of the platform they’re
shown on. A few basic creative elements—copy, an image, and a click-through link—are all it
takes to run native advertisements in a wide variety of locations.
Running native ads on mainstream websites can work well for cannabis and CBD brands
because the surrounding content normalizes the ad: For many people, clicking on a cannabis ad
will feel less intimidating when it’s not on a site like High Times.
Digital Audio Ads for CBD & Cannabis
Audio represents an up-and-coming ad format in the programmatic landscape, and the share of
audio ads is expected to increase significantly in the coming years. Benefits of audio advertising
include a high likelihood of an engaged audience (think commuters sitting in traffic) and 100%
share of voice during your audio spot (i.e., no one else’s advertisement is playing during those
30 seconds).
Connected TV Ads for CBD & Cannabis
Another up-and-coming channel for programmatic advertising, connected TVs offer many of the
same benefits that streaming audio channels do, including an engaged audience, 100% share
of voice, and the ability to leverage this channel early before other cannabis businesses start to.
Connected TV ads aren’t governed by the same rules as broadcast TV ads, and they allow
advertisers to reach potential customers in the comfort of their own homes.
Emerging Advertising Techniques for CBD & Cannabis
A few key channels are currently trending for cannabis ads in the programmatic space, including
digital audio, connected TV, and geofenced mobile. In the next few years, we expect brands to
begin adding some budget for digital out of home, or DOOH, inventory like digital billboards.
Voice advertising is also expected to become a major channel as virtual assistants become
pervasive.
While the ad industry continues to evolve, we can be certain of one thing: As programmatic fully
permeates digital advertising over next few years, businesses who’ve been leveraging
programmatic technology from the earliest opportunity will have a huge head start.

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