Cannabis is becoming more and more mainstream in the US: 2023 saw continued growth in the social acceptability of cannabis use, new states legalize medicinal and recreational cannabis sales, and a major social media platform change its policies to allow for cannabis advertising. The cannabis market is forecast to reach a whopping $50.7 billion in sales in 2028, representing an 88% increase from 2022’s $27 billion.

Image that reads "the cannabis market is forecast to increase by 88% between 2022 and 2028," with the "88%" statistic emphasized. The image also reads "Source: Brightfield Group, 2023."

While the industry is clearly on the rise, cannabis marketers have plenty of challenges to contend with—from a maze of advertising regulations, to economic uncertainty and inflation, to the upcoming loss of third-party cookies in Chrome and shift towards privacy-friendly digital advertising. To both navigate these challenges and capitalize on the market’s potential, cannabis marketing teams will need to prioritize brand awareness, crafting targeted strategies that make the most of the spaces where cannabis can be advertised and where their target audiences spend time.

Here are some trends and tips for making the most of cannabis ad spend in 2024:

Trend #1: Prioritizing Targeted Brand Awareness

There are a lot of consumers out there who are new to cannabis. So, when they go to purchase a cannabis product, they're often choosing whatever the budtenders recommend, whatever looks flashy and fun, or perhaps most commonly—especially during inflation—whatever’s at a good price point for them. As such, it’s extra important for cannabis marketers to drive education of their brands and generate interest in their products. Connected TV, digital audio, and digital out-of-home (DOOH) are great channels for accomplishing this. Marketers can tap into CTV private marketplaces (PMPs) that accept cannabis, such as Telaria and FreeWheel, cannabis-friendly podcasts, and digital out-of-home partners like Place Exchange.

In 2024, cannabis brands looking to amp up awareness and differentiate themselves most effectively will also need to ensure their tactics are as targeted as possible. One way to get more targeted with these efforts is to identify specific consumer personas and tailor lifestyle content that extends beyond cannabis use specifically for these groups. There are segments of consumers who enjoy things like cooking, gardening, and outdoor activities in addition to cannabis, so tapping into those interests is a great way to create consumer personas for targeted advertising efforts. And looking towards a privacy-first future, CTV and podcasts also offer contextual targeting opportunities where cannabis marketers can reach these groups of people.

Trend #2: Tapping into Digital Out-of-Home

While cannabis brands are very familiar with traditional out-of-home, 2024 should see more and more marketing teams spending on digital out-of-home (DOOH).

DOOH is great for cannabis advertising for a variety of reasons. First, it offers all the benefits of traditional OOH, plus all the benefits of digital advertising—the ability to target, track, optimize, refine, measure results, and quickly switch out creative as needed. Also, as cannabis gains legal status in different regions, an increasing number of dispensaries are emerging. The more dispensaries there are, the more opportunities there will be for advertisers to leverage in-store DOOH screens to reach customers who are ready to buy in prime places and moments.

At the same time, while there are many restrictions when it comes to advertising cannabis online, DOOH comes with fewer restrictions, so advertisers can get many more impressions from a wider audience. Overall, it's a great way for cannabis brands to get more bang for their buck with less red tape.

Trend #3: Branching Out into Real World Engagement

Finally, next year should see more and more cannabis brands trying to engage audiences beyond the digital world. For example, brands will likely invest more time and money in educating budtenders on their products: If you go into a dispensary and have no idea what you're doing or what you want, you’re going to ask a budtender for their advice. If those budtenders are educated and excited about your products, then they'll be more likely to talk about them with those customers.

Savvy marketers will also lean on real world engagement opportunities that are more commonly associated with B2B advertising—such as conferences, panels, and interviews—to get people talking about cannabis and their brands. These strategies can help make up for all the regulation and restrictions that exist for traditional and digital cannabis advertising.

Wrapping up: 2024 Trends for Cannabis Marketers

Overall, cannabis marketers will need to approach brand awareness in new and creative ways in 2024 to differentiate themselves in a market where everyone is vying for consumers’ hard-earned dollars. By prioritizing targeted messaging, digital out-of-home, and real world engagement, cannabis brands of all sizes can ensure they're making the most of their marketing dollars and setting themselves up to capitalize on the explosive growth coming to the cannabis space.

Hungry for more 2024 trends? Check out our 2024 Trends Report for everything digital marketers need to know for next year.

How many streaming services does your household have access to? Maybe you pay for Amazon Prime and Netflix, but you use a roommate’s Paramount Plus login, your best friend’s Peacock credentials, and an ex-partner’s HBO Max account that they conveniently never logged out of. Welcome to the wild world of connected TV viewing!

The lack of unified connected TV (CTV) inventory is mildly frustrating for consumers (wait, which app can we stream the new Mandalorian episode on?), but it’s doubly so for marketers. Add in the fact that it’s tough to know who precisely is in front of a TV set at a given moment, and it’s clear that, much like the broader marketing landscape, CTV is complex.

The cost of this complexity and fragmentation can extend beyond the consumer experience, trickling all the way down to team satisfaction and turnover rates. CTV media fragmentation results in inordinate amounts of time spent on the low-value, manual tasks necessary to cobble together data and holistic insights from many disparate media sources. In the context of burnout within the digital advertising industry, it’s critical that brands and agencies seek out ways to automate as many of the workflow-related aspects of the media buying process as possible in order to retain talent and avoid the high costs of turnover.

Despite the challenge of fragmentation and the need to embrace tech to streamline CTV advertising, savvy marketers know that connected TV is an effective channel to include in a marketing mix. After all, nearly 85% of US households now own a connected TV device, and 46% of US adults watch content on a CTV device every single day. And, it remains one of digital advertising’s fastest-growing channels, with CTV ad spend projected to hit $31.77 billion by 2024 (a whopping 10.2% of total digital media ad spend).

To make the most of this booming channel, advertisers need to understand how to work around industry fragmentation to run effective CTV campaigns and connect with viewers when and where they’re watching video. Read on to learn how to most effectively plan, target, and measure CTV campaigns in today’s digital advertising landscape.

Best Practices for Planning CTV Ad Campaigns

Planning an effective CTV campaign requires marketers to grapple with pain points related to targeting and measuring. While identifying targeting parameters and KPIs early in the planning process is best practice for any campaign, it’s even more important when it comes to CTV (more on this later!), due to the channel-specific challenges those areas present.  

In addition to identifying KPIs early in the planning process, planning for optimizations is another best practice for the early stages of a CTV campaign. This could include preparing multiple versions of the same video, editing them to different lengths, and planning to A/B test them to see which lengths perform best. Setting yourself up to be agile throughout the campaign will only make things easier once your media goes live.

Once you’ve identified your KPIs and planned for optimizations, consider the following when planning an effective CTV campaign:

Best Practices for CTV Targeting

Okay, you’ve identified your KPIs, planned for optimizations, and made intentional creative choices based on your audience. On to CTV targeting!

There are many targeting opportunities in the realm of CTV. BasisTV+, for example, offers more than one thousand advanced TV targeting parameters within the platform. Let’s dive deeper into some of these targeting opportunities!

First, contextual advertising solutions are privacy-friendly, scalable, and cost-efficient, making them a no-brainer for CTV campaigns. These audience segments are classified using groups such as content category, broadcast type, production type, app store, and device, in order to better target media based on user viewing habits. For example, a home décor brand may want to run their ads within a content category that features home improvement projects, and a gaming company may want to target viewers tuning into CTV inventory through gaming console devices.

Leveraging private marketplace deals (PMPs) is another privacy-friendly way for CTV marketers to target. Within a PMP auction, advertisers can layer on contextual, first-party, and demographic data to further target specific audiences.

A few other key targeting tactics that advertisers can leverage within their CTV campaigns include geotargeting, dayparting, and retargeting. These allow marketers to reach viewers in specific locations and at specific times, and to extend their first-party segments across devices.

A final note on effectively targeting your CTV ads: Intentionality is key! If your allowlist is too limited (i.e., you’ve layered on too many different targeting tactics), it will be difficult to effectively scale your campaign and reach a broad audience.

Best Practices for Measuring CTV Ad Campaigns

As explored earlier, fragmentation is one of the most pressing challenges facing CTV advertisers—and it can make measurement and reporting especially tricky.

One of the best ways to maintain focus is to intentionally plan and optimize towards specific key performance indicators (KPIs), which will also help to ensure that you’re connecting with the right audiences, in the right ways.

So, which KPIs should marketers consider when planning CTV campaigns? VCR tends to be the most common (and no, we aren’t talking about those clunky rectangles you held onto for years because you were sure they’d be worth something someday). Video completion rate, aka VCR, tells advertisers the rate at which their ad was viewed in its entirety. Other KPI options to consider for your CTV campaign include:

There are a variety of partners—or, even better, full-service advertising platforms with a variety of partner integrations—that marketers can layer onto a CTV campaign to leverage custom capabilities for each campaign and optimize towards specific KPIs.

BasisTV+, for instance, features several notable CTV partnerships that advertisers can leverage within their campaigns. These include:

Next Steps: Connected TV Advertising

While the fragmented nature of CTV advertising presents marketing challenges, brands and agencies willing to think outside the box and test creative solutions will enjoy the broad brand awareness, leads, and sales/conversions CTV offers. Part of running effective CTV campaigns today really comes down to planning: Marketers who do the upfront work of identifying KPIs and audience targeting tactics will see gains once their campaigns go live. Another key piece is leveraging a platform for your CTV campaigns that makes things simpler, rather than more complex.

Beyond using the strategies we explored to be intentional about planning, targeting, and measuring CTV campaigns, marketers need to stay in-the-know about this ever-evolving channel. If you’re looking for a deeper dive on strategies to embrace the connected TV advertising opportunity, check out our Connected TV Advertising Guide. In it, we analyze the latest data, trends, and research so that marketing teams can make the most of their CTV ad spend.

What are you going to watch? Yes, you!

One of the most daunting decisions we make today is what to watch. All of us are constantly inundated with content options and it’s hard to not find the experience overwhelming. Personally, I end up re-watching The Office instead of finding something new. That said, it’s not all bad! Thanks to the Connected TV (CTV), we now know the best way to watch. Looks like you’ve found your show! While it’s loading, let’s explore how your CTV works, below!

What is Connected TV?

A Connected TV (CTV) is a television or connected device with an Internet connection and a UI that enables users to access content through applications such as Smart TVs, Gaming Consoles, and Set Top Boxes. Centro will serve video ads to users on various Connected TV devices including Roku, Xbox, Apple TV, and more.

Connected TV is channel accessible via programmatic media which takes place in a Private Market Place (PMP). A Private Market Place is an exclusive, invitation-only exchange where premium publishers make their inventory and audiences available to a select group of buyers, programmatically. PMPs not only have premium inventory but also allow for higher win rates as there is less competition for ads to be shown.

For example, SpotX is a Video Advertising Platform that creates PMPs that are made up of premium publishers, such as Pluto TV, Samba TV, and Discovery. These publishers offer hundreds of channels with a plethora of content. Therefore, if you choose TNT’s Animal Kingdom on the SlingTV app on your CTV device and see an ad, this ad has won this inventory via the SpotX PMP.

How Does Connected TV Advertising work?

Is your show still loading? Good. Your next question may be, how are these ads targeted to me on my CTV device? This can get tricky as CTV devices are not tied to a device ID, which is how advertisers are able to target ads via desktop and mobile. Instead, CTV devices are tied to an IP address because they are connected to the internet, as well as, the rest of your household. PMPs curate publisher inventory based on content indexes. Therefore, if the Animal Kingdom indexes high against auto intenders, then you will most likely be receiving a car commercial.

Oh, looks like your show is about to start! Well, I think we made the best of a boring situation. Next time you turn on your CTV device with your friends, take advantage of the load time and impress them all with your understanding on how Connected TV advertising works—and enjoy that streaming content from the comfort of your couch!

Want to know more? Learn more about the Connected TV advertising opportunity with Centro, here.