Twitter Greenlighted Paid Cannabis Advertising. Here’s What Happened Next.

Twitter sent the cannabis industry a big, juicy valentine on February 14, 2023 when it announced that the social media platform will now allow paid advertising by licensed cannabis brands in the United States. The new drug and drug paraphernalia policy on Twitter’s business page states, “we permit approved Cannabis (including CBD—cannabinoids) advertisers to target the United States.” 

The move certainly shook up some cannabis businesses’ marketing budgets as brands reevaluated their approach to ad spend. But months after the announcement, did the change really pan out for cannabis companies? Now that the dust has settled, we dig into whether Twitter (or X, as Elon Musk is now rebranding the platform) really changed the game for cannabis social media.

What Are Twitter’s Cannabis Advertising Rules?

According to the policy, only licensed cannabis companies can seek preauthorization to buy ads on Twitter. Once approved, advertisers must abide by existing cannabis advertising restrictions, including only targeting customers over the age of 21 by not:

• Appealing to or depicting minors in the creative
• Neglecting age gating for verified landing pages and websites facilitating e-commerce sales
• Including cartoons, celebrities, popular characters or other imagery appealing to minors
• Depicting the act of consumption
• Encouraging transportation of cannabis across state lines

In addition, cannabis brands advertising on Twitter have to stick to U.S. Food and Drug Administration rules about not making false or misleading claims, not featuring pregnant people in advertisements and only promoting cannabis or CBD products if they fall under the 0.3% THC threshold outlined in the 2018 Farm Bill.

The April 2023 Update to Twitter’s Cannabis Ad Policy

Just a couple of months after its initial rollout, Twitter updated its cannabis ads policy again. In April of 2023 Alexa Alianiello, head of Twitter’s U.S. Sales and Partnerships, announced, “We have gathered meaningful feedback from the cannabis industry which we have taken into consideration to create even more opportunity.”

Those changes include permission for certified advertisers to:

• Include imagery of packaged cannabis products in their ads
• “Continue responsibly linking” to owned media, such as websites and e-commerce pages for cannabis-related products and services
• Advertise in “additional recreational markets” 

However, details on the “changes of medical licensees” and which additional recreational markets—and what restrictions apply to them—were not specified, nudging curious brands to reach out to Twitter ad specialists. Presumably, advertisers still may only target their ads toward the locations where they are licensed to operate—a cannabis brand licensed in Oklahoma can’t target social media users in Texas with its ads, for example.

Why Is Twitter Allowing Paid Cannabis Advertising?

Twitter’s decision to allow paid advertising by cannabis brands was not totally unprecedented. The platform already allowed paid cannabis advertising in Canada, where cannabis has been federally legal since 2018. Ever since Elon Musk acquired Twitter in 2022, there has been industry speculation about what Musk’s open penchant for cannabis could mean for brands on the platform.

The personal habits of a CEO don’t necessarily translate to company advertising policy, however. The more likely explanation for Twitter’s about-face is its recent revenue woes. Since Musk’s acquisition of Twitter, the company has struggled to meet its advertising targets, clouding the platform’s fiscal prospects. In December of 2022—a time of year when the media is filled with gift guides and shopping recommendations—ad spend on Twitter dropped 71%. 

Opening the door to cannabis brands was one way for the platform to attract new advertising accounts at a time when it badly needs an influx of cash. That’s a pain point many cannabis brands can relate to. Around the time that Twitter’s ad revenue tanked, the cannabis industry was on its 17th straight month of decline, with the average price for flower dipping by 23%.

That bear market hasn’t let up in Q1 or Q2 of 2023—prompting some cannabis companies to take radical action for lean times. In May of 2023, for example, cannabis distribution platform Nabis teamed up with Lowell Farms and Sunderstorm to form the the Financial Stability for California Cannabis coalition to agitate for industry debt reform.

Belt-tightening has many brands rethinking their cannabis marketing and PR strategies. That means paid advertising opportunities like Twitter’s can be very appealing to cash-strapped brands looking to go long on a little spend. That’s especially true for any brand watching the success some MSOs have had with their new Twitter ad campaigns.

Are Paid Twitter Ads Worth It For Cannabis Brands?

AdWeek reported that, “Shortly after running its first paid ads on Twitter this spring, cannabis conglomerate Curaleaf saw its following on the platform balloon by 300%, while its competitor Trulieve got a 214% boost in its web traffic." With numbers like that going strong through June according to data from Sensor Tower, many small to midsize enterprises (SMEs) will no doubt hope for a bite of the same pie.

Of course, it didn't take long for some marketing experts call the Twitter ad rollout “anti-climactic," bolstering naysayers who swiftly judged the the-platform-formerly-known-as-Twitter's bid to be a bit of nothing-burger. Sure, an initial surge in interest doesn't always translate to long-term success, especially in social media—just ask Threads, Meta's new platform and so-called Twitter-killer that quickly saw momentum on new user acquisition peter out. But it may be too soon to write off the new symbiosis between X and cannabis brands.

In July of 2023, Cheech and Chong began spending "between $250,000 and $500,000 a month for gummy ads on Twitter." Some members of weed Twitter took note of the sudden prevalence of the 1970s stoner comedy duo on X, as did Elon Musk himself. During the same period, however, the platform's overall ad sales continued to camp out in the basement, down nearly 60% from the previous year.

It's true that few cannabis companies can afford a monthly ad spend rivaled only by FAANG companies like Apple and Amazon. But with overall advertising down on Twitter, there's also less competition for the organizations that do choose to set up paid ads. It remains to be seen if a spendy vote of confidence from a house-hold-name brand like Cheech and Chong is enough to convince other cannabis companies to make a similar investment.

Will Other Social Media Platforms Also Allow Paid Cannabis Ads?

It also remains to be seen if Twitter's decision to permit cannabis advertisers inspires a similar shift by the platform's competitors. Meta, for example, is notoriously unfriendly to weed brands posting content to Facebook and Instagram, for example. Mark Zuckerberg's social networks may have loosened their policies concerning CBD and hemp (a little) in July of 2023, but Meta remains quite conservative when it comes to cannabis.

Meanwhile, Amazon-owned Twitch officially banned cannabis companies from sponsoring streaming channels in June of 2023. The move cements X and LinkedIn as two of the only widely-used social platforms where cannabis companies can reliably find traction.

No wonder that the cannabis industry continues to pursue new omnichannel solutions instead of trying to persuade social media companies to loosen their stance. Google's approach to cannabis, CBD and hemp has long been lukewarm, making cannabis SEO as much an art as a science. Although the search engine updated its policies in January of 2023 to allow CBD companies to promote products with low THC levels in certain regions, full-on paid Google ads for cannabis brands are still a pipe dream—if you'll forgive the pun.

Six months after Twitter's policy change, paid online cannabis advertising remains a new frontier. It will be interesting to see if the success big MSOs have had trickles down to the rest of the industry, and proves lucrative enough to sway social media competitors.