Marketing strategy

Inside Cannabis Company Fluent’s Email and SMS Marketing Strategy to Develop First-Party Data

Inside Cannabis Company Fluent's Email and SMS Marketing Strategy to Develop First-Party Data

Florida-based cannabis company Fluent is steadily stepping up its email marketing to create a direct line of communication with buyers in an increasingly noisy digital environment.

Cannabis regulations became less stringent thanks to the 2018 Farm Bill, which legalized hemp. However, restrictions on cannabis advertising are still in place on social media platforms like Facebook, Twitter and YouTube owned by Googlemaking digital advertising a murky place for cannabis brands like Fluent.

While some cannabis brands have found a workaround through influencer marketing, Fluent has instead focused its efforts on its messaging strategy, which has seen spending increase 25% year over year, according to Os Graziani, chief creative officer at Fluent. Currently, Fluent’s budget for email and SMS marketing is around $350,000 per year, Graziani added. About 20% goes to email marketing, leaving the remaining budget for SMS efforts, he said.

“We decided to go back to email because at least I can have a direct conversation with my consumer,” Graziani said. “We created this amazing database of customers who were waiting for emails every day because they knew they were of some value.”

Over the past three years, Fluent has implemented an email strategy, spending 25% more on the channel each year as it becomes the brand’s primary customer retention tool. Recently, Graziani said the brand had implemented text message-based marketing and was testing segmentation as part of those efforts. The information gathered helped Fluent develop its marketing and product strategy, he said.

Currently, Fluent sends 10 to 14 emails and texts per week, an average of one or two emails per day to customers who sign up during in-store visits at Fluent outlets, said Graziani. This mailing list has grown from 2,000 to 150,000 since its inception, according to Graziani.

“We are really [keeping] an eye on open rates and engagement and we [found] that it’s definitely about putting value in emails,” Graziani said, adding that Fluent’s marketing emails include discount offers, new product launches and company announcements.

For Fluent, email and SMS marketing served as a cost-effective tool for customer retention and brand awareness. According to Graziani, a text campaign can lead to a 20% increase in revenue compared to a day without a campaign.

According to Kantar, Fluent spent over $22,000 on media in 2021, a significant increase from the $2,655 spent in 2020. In 2019, Kantar reports that Fluent spent $25,000 on media. These numbers do not include social media as Kantar does not track these numbers.

While email marketing has remained a consistent communication channel between brands and customers, advertising experts say data privacy measures like iOS 15 have put a “proverbial nail in the coffin” email marketing for brands that receive emails from third-party data sources.

But for brands like Fluent, which rely on first-party data to build email subscriber lists, email marketing makes sense, according to Nicole Penn, president of the marketing agency. EGCGroup.

“Emails and SMS allow brands to rely on first-party data. The more personalized information you can have about your consumer, the better,” she said in an email.

However, she cautions advertisers to treat data and inboxes with respect.

“You’re not the only brand in their inbox (you’re probably one of 60 or 70),” Penn said. “And if you communicate too often with content and experiences that aren’t useful or memorable, you risk opting out.”

While the digital advertising landscape remains unfavorable to cannabis, Fluent plans to continue its email and SMS marketing efforts, using social media solely as a branding opportunity.

“We are definitely ready to be on social media when they let us. Right now it looks like a very tough test,” Graziani said.