MSO Strategies: Regional Roadmaps & Revolving Doors - Branding Bud Live Episode 19
THE SUMMARY
It's been a tumultuous year for the cannabis industry, and the shifting legal and regulatory environment has forced many Multi-State Operators (MSOs) to reevaluate their strategies. In this episode of Branding Bud Live, we'll explore the reasons why MSOs are leaving states, regulatory hurdles, market economics, and other production, processing, sales, and distribution challenges. Join us as we delve into the state of the industry and discuss the evolving cannabis landscape and how MSOs are responding to it with our guest, David Goubert, President & CEO, of Ayr Wellness Inc.
THE CO-HOSTS
David Paleschuck, Adriana Hemans
THE SPECIAL GUEST
David Goubert, President & CEO, of Ayr Wellness Inc.
THE TRANSCRIPT
David Paleschuck
Welcome to Branding Bud Live, the live stream that’s 100% THC and 0% WTF. Every week we speak with business people about the business of cannabis. I’m David Paleschuck, founder of Branding Bud Consulting Group and author of the first book on cannabis branding. I’m joined by my co-host Adriana Hemans, a Marketing executive with over 8 years in the cannabis space. Hi Adriana!
Adriana Hemans
Hi David. Thank you for that intro. I’m so excited to co-host the show with you. We’re bringing amazing guests from across the cannabis ecosystem to share their perspectives. My favorite thing about Branding Bud Live is that we focus on building community - and we encourage audience participation. It’s not just about us talking, it’s about all of us building something together. So feel free to drop your questions and/or opinions in the chat, and we’ll share them too.
David Paleschuck
Thank you, Adriana. And thank you, everyone, for joining us today. We have a lot of hot topics to get into today. Today, we’ll be talking about “MSO Strategies: Regional Roadmaps and Revolving Doors”. Specifically, we’ll be discussing:
Luxury products and experiences in cannabis
What cannabis companies can learn from “mainstream” retailers and brands
How MSOs make decisions about entering and exiting state markets
Growing brands inside of an organization versus through acquisition
Strategies for growing brand awareness in a fragmented landscape
Our guest today is David Goubert, President and CEO of Ayr Wellness - a vertically-integrated multi-state operator headquartered in Miami, FL. Ayr has 80 retail locations across 8 states including 14 that opened last year in 2022.
Prior to joining Ayr Wellness, David was the President and Chief Customer Officer at Neiman Marcus. David also spent 20 years at LVMH, (Louis Vuitton, Moet, Hennessey), the world’s leading luxury consumer-products company. I’m excited to chat with David today.
Adriana Hemans
Me too! Hi David. Welcome. Coming from your background in luxury products and multi-brand retail, what drew you to the cannabis industry?
David Goubert
Hi, thank you. And thanks David. Adriana David, welcome back. Right, you just came back and very happy to be with you guys today.
Adriana Hemans
Awesome. Thank you for joining us from Miami. David talked a little bit about your background at Neiman Marcus. And so just to kick us off let's get into your background and luxury products and multi brand retail experiences that brought you to the cannabis world.
David Goubert
I'm sure French European friends started working in engineering and manufacturing supply chain study working in that in Nestle and consulting and then then joined LVMH through Louis Vuitton. And if you look at the best 30 years may have been working for 30 years. And if I look at the best 30 years, it's been 10 of 15 years of manufacturing and supply chain jobs and mainly in the luxury industry. And then the most recent 16 years have been around more of retail marketing, and general management of companies in that industry with Louis Vuitton style board, Neiman Marcus and such. And I came to a point in my career where I was looking for something different than and sell that I wanted to work in a place where it was working for the greater good was working for a purpose. And I met with the founder of air about a year ago. And our first conversations were all about the company being a force for good and how the cannabis industry is actually very much for the greater good whether it's for the health and wellness of patients and customers or whether it's from a socially police standpoint and righting the wrong and the war on drugs. And the more we talk the more we talked about all that the more I became interested about this industry, and at the same time felt that were the industry was and more air in the life cycle of the company was a place where maybe I could bring something of the experience that I have and learn at the same time from the people that are here. So here we are four months later and don't regret it. Love it, and learning every day.
David Paleschuck
Wow, that's very cool. Very interesting. So coming from, you know, Neiman Marcus and Louis Vuitton Moet Hennessy, can you talk about luxury for a moment luxury and the luxury experience? You know, in retail, let's say versus where you are now and in offering a similar experience?
David Goubert
Yeah. So a great thing, I'll, I'll do a comparison a bit about the customers, because to me a lot, actually, is about the focus on the customer. And one thing that I think is, and I'll come back to that luxury experience, but one thing that's, I think, really amazing about the cannabis industry, when I compare with the luxury industry and luxury customers, is that we have actually customers and patients that are coming every week, several times a week, or every two weeks on average, to us, and if you think of luxury, while you're happy when you have a customer that comes in shop every two months, three months, and most of them you see them once a year, or twice a year, which makes it much harder to truly build a relationship which makes it harder to really know them and mean something to them. And what I find amazing in the cannabis industry is that you actually have a chance with the frequency of people coming in, you have the chance to really know them better, you have a chance to actually build a truly good relationship. I'm actually very impressed by Indian industry in general. And obviously, they're the bud tenders and how the good tenders normally know the products but know their patients and their customers and can build those relationships. So one key thing I would say from that comparison that you're making is, is that because of that frequency and because it's a pretty intimate, you know, a conversation that you're having, you really can build these relationships, which to me are part of a true luxury experience. That being said, I think that there's a lot to learn from mainstream retail and luxury retail in sum of customer experience that we can build and in for the cannabis industry. I think one other parallel that's quite interesting is I think it's pretty intimidating to go into a cannabis store if you're not someone that's already very familiar with the environment. And in some ways, it's no different than how intimidating it is to go into a Louis Vuitton store or a product store. It's not something that that you just go and enjoy like that and it gets intimidating the first time you do it. And I think we're in the same space in some ways different way where the same space where it's actually we've got to figure out a way to make that not intimidating and welcoming, while at the same time remain The true customers that know so much about cannabis and want to come and get the greatest products. So that's an interesting parallel, I think. And there's a lot to learn from a customer experience standpoint.
Adriana Hemans
Yeah, I love what you just said that there's sort of that like barrier to entry the first time, you may feel intimidated walking into a dispensary for the first time. And you also mentioned the how bud tenders can build that intimacy, which I really like to and the relationship that they start to develop with not only the budtender, but with the brand itself is there are there certain characteristics aside from the intimacy with the budtender, and the relationship that they're building that makes a cannabis shopping experience luxury, or a cannabis product itself a luxury product.
David Goubert
So there are some products that you could consider to be to be luxurious, I would say the first thing is, I think the first step and the first thing that that matter is to convey that the product is safe and do all the work to really get the customers to see that the product is safe. And I think a lot of the work that has been done so far and few exceptions as very much being around that and around having the right products and so on more than building brands, truly, and building that that luxury segment in the cannabis industry. So that being said, I think there's a there's a few that have been a match to Korea, it's really a differentiator, and to create luxury products or luxury brands. But I would say we're at the very, very beginning of that. When you think of brand, and I'm sure we'll talk more about it and what makes a brand. It's about the story. It's not about creating a story. It's about telling the story. That's a true story. I need to find what is exactly your DNA as a brand and your story. And I think that in the cannabis, we're very much at the beginning of that, except maybe a few exceptions.
David Paleschuck
One of the things you said earlier, you spoke about the bud tenders and Becky had commented about the bud tenders being the unsung heroes. My experience with bud tenders has always been positive and they're always welcoming, and they always want to share education, about cannabis. But getting in the front door is the hard part, right? You know, feeling comfortable to enter a cannabis dispensary or an adult use store is rather intimidating. And on top of showing your license to come in, you know and showing that you can make a purchase. It's interesting because I I've had experiences that supreme for example, where the door is locked or shut, and they'll give you the look the up and down look to see if you're even worthy of coming into their store to purchase this product. So it's really interesting, the I guess the connection, but also the dichotomy between fashion and luxury brands, where are you one of us? Can you even be wearing our products versus what I believe to be much more inclusive in terms of cannabis like Come in, come in to our community be part of our community learn more about our community? You know, is there a difference between the ethos of a fashion brand and a cannabis brand? Is that is that I guess maybe what I'm describing or feeling I think that it's actually at the same time harder and instead the same time easier for the cannabis versus what a luxury products or luxury industry. It's, it's harder to create that and to create that welcoming and to remove these barriers.
David Goubert
It's harder because you actually have all the weight and the stigma that that went with cannabis and that creates that. That difficulty on that front, right. At the same time, I think it's also easier because there's and you talked about the bud tenders before but there's such a passion from the teams from everyone that is around cannabis for the plant that you actually get to a place where it makes it probably easier to share and probably easier to welcome them than it is in, in the luxury industry. And so it's a matter of figuring out ways to break that that initial barrier and create that intimate relationship and intimate moment where you can absolutely share that passion that the teams have and that passion for the plane. I remember, at Louisville a few years ago, having the exact issue that you were talking about in luxury and figuring out a way how do we train our teams, on making sure that people were welcome, where they were coming in? And how do we how do you make them feel that they're, they're welcome to your house. And actually, we built a training at that time, or even, you know, a logo and everything saying, Hey, you're going to welcome people the same way that you welcome them to your house or to your home. So we built a training that was welcome to my home. And if you think about it, when you bring someone to your home for the first time, or anytime, actually, the first thing you do when they pass the door, is you welcome them, right, that's your first thing. The second thing you do with them is probably take their coat or offered to take their coat and so on. The third thing is probably offer them a glass, something to drink, then you're going to walk them around, you probably going to also introduce them to other people that are in the space. And by then actually, you've started to break these barriers, and make someone feel comfortable the same way you would in your home. And that has been an amazing, across the world mean, hundreds of stores. It was an amazing way for us to get our teams in the mindset of welcoming someone in a way that you would do it in your own home. And I'm not saying that we're going to do the exact same thing. And we need to replicate that exact training. But that's the way that we need to think about making that experience more personal and at the same time, not intimate, intimidating, personnel and more inclusive, especially as we're moving into having consumption lounges.
Adriana Hemans
And you really are having a social experience with the other people that you're consuming in the same room with and you see a lot of consumption lounges that have sort of set it up like a living room where they're like encouraging people to interact with each other and play games and have conversations. So that's interesting to hear, to hear about that. And I want to call out a quick comment from Becky Slater that made me chuckle a little she said, luxuries like do you look rich enough for this product? Cannabis is like, do you look cool enough for this product? Thanks for your comment, Becky. And thanks for everyone who's from Chicago.
David Goubert
The interesting thing, by the way, sorry. And going into what Vicki maybe also is talking about here, I spent 20 years in luxury and a pretty good understanding of the level of spent and what customers are worth if you want for luxury brands. And, and the interesting thing is that because of the frequency of moment, that that patients and customers are coming to stores and so on, the value of a customer in cannabis is actually very similar to the value of a customer in luxury, that may not be the same customer that may not be someone that has the same behaviors, but it's actually very, very similar from a value of customers and what the what they spend in lifetime or they spend in a year in the cannabis industry. So what it means also from a strategy and business standpoint, and is a shift on understanding that we need to become more and more customer centric organization where we know better our customers where we do a better job to understand their behaviors better segment these customers so that we can connect with them in a much better way. And to me, this is not about additional transactions with people you don't know it's very much about building these relationships, and understanding better your customers. That's actually something I did not necessarily expect coming in and is seeing so much similarity if you want from that standpoint, and from a value standpoint.
David Paleschuck
That's it's quite interesting. You know, you would always think, or at first thought you would think a luxury consumer is probably worth more to the company in terms of value. And you know, let's say annual spend. But now when you really think about it, you know, cannabis consumers it's a consumable, right so there's not only are they purchasing more, but there's the opportunity to build and reinforce the relationship or Over the course of guests sit here, let's say totally.
David Goubert
And that's why I insisted also on the talks about being something very intimate. I mean, you're sharing when you come as a as a cannabis patient or cannabis consumer in general, you share a little bit of yourself, it's become, to me a very intimate relationship that that you're building. And that's why I mean, I think it was Vicki that was saying about the buttons are the unsung heroes, they really are the unsung heroes. They know, their, their, their patients, their customers, they're building that relationship. And our job is to make sure that we support them the best way possible and really elevate that further. And I think that's at the heart of what the experience in cannabis shouldn't be.
David Paleschuck
And I'm, I'm curious, because this may not be the best way to describe this. But I almost see as I see, luxury and high end fashion as a push, you know, it's, this is what you should be wearing. This is what is in season, this is we're dictating to you what, what you should be wearing and when you should be consuming. Whereas it seems almost the opposite. In some ways. We're in cannabis. Of course, the bud tenders are educating but people are coming in and saying this is you know, this is my ailment, this is what I'm looking to heal. You know, this is Adriana and I always talk about additive or subtractive mindsets when you when consumers come in. So that said, it's really the consumer coming in talking to the budtender, this conversation happening, and then the consumer in a perfect opportunity leaving with something that that is really big. I use the word prescribed, although I don't really want to use that word, something that's offered to them, for them and their specific needs. does that differ across states? Since you're in multiple states? Do you do you see bud tenders rolling up information? I guess, to air corporate to say yeah, we have different things happening in different states and different consumers are asking for different things in different states.
David Goubert
Yeah, you do. And you do have difference. Depending on I would say a lot also on the maturity of the markets, and how the market how long the markets have been open. By the way, if I may take one minute, very interesting thing, what you're saying about the push on the luxury, because we actually seen I'm still passionate in some ways about luxury, right? So and fashion. But we've seen really a shift in time and decades about what you were talking about, if you were a few decades ago, it was very much about what products you can have available and especially in the US knowing that most of the fashion was coming from Europe was very much Hey, what comes available that I can actually purchase and then it moves to exactly what you described, which was kind of the brands and fashion leaders dictating what you should wear what you should carry. And, the head to toe, if you want with a brand and very much it was a I'm going to tell you what looks cool and what you should wear, right? But that has shifted in the best years in the most recent years to luxury yes turns a lot into self-expression, or an expression of themselves. And the luxury for me doesn't mean the same thing as the luxury for you. And luxury brands right now are shifting or need to shift and are shifting on understanding that is no longer a push. But it's actually very much more how do we help our customers get the best expression of themselves. And it's a very important shift in luxury that's happening right now. So I put that aside and get back to your question on cannabis and the difference by states. It's interesting to me like the first two months of joining air in November in December I traveled to me would say almost all our location, except a few in Florida and meeting people everywhere. And I've seen clearly the differences that you're talking about there's in a lot of states and especially at the beginning of the of the use of cannabis. It's all about THC, right so the THC potency and or is it 20% 25% 3% THC and that's the number one factor in in some markets, even today. And then some markets, either medical or adult and med Um, I've evolved or are looking at different things, I'll take one example and the which is Pennsylvania, Pennsylvania, which is, is medical market has been, to me the, the, probably the pinnacle example of terpenes matter more than THC. So for the one that that, as I'm learning right now terpenes are these molecules that actually give the, the olfactory factor and the smell of the of your, your flower and your products, and you find terpenes in, in other plants, right in agriculture and trees, so it could be a pine tree, the smell of that is a terpene. And the same on Cypress and so on. And, and, and when it comes to cannabis, there's hundreds of them, which, by the way, I love that's my thing. It's I have to smell buds all the time, because I love trying to recognize these terpenes between something that very free versus very cheesy or, or other types and it's absolutely awesome. But your question, Pennsylvania is probably the market for us where terpenes matter the most to the point that we had to adapt our online menus to really make that two key elements at the top because those were the key things for patients and consumers knowing that terpenes have a real impact from even from a health and wellness standpoint. So markets are reacting very differently from a category of product meaning type of products, or what matters between THC terpenes, or other things and strains.
David Paleschuck
It's, it's super interesting and intriguing to me, I happen to be a lover of colognes and perfumes and, and natural scents. So terpenes sort of fall right into that for me. I often have this conversation with people when they're trying to talk about terpenes, and they don't fully know how to describe it. And I always say it's just like aromatherapy. And I believe the aromatherapy model is the best way to have the conversation about terpenes because people understand aromatherapy and if you use it as a parallel and talk about lavender being relaxing. Lavender actually has Lena Leuven and Lina is, you know, often found in higher quantities in indica, which is more. And forgive me for the experts out there that you know, I know there's one more indica and sativa. It's all hybrid. But what I'm making the analogy here is that there's a scale. And you can say the same thing. Citrus is refreshing and invigorating pine, same thing. If we looked at limonene. And pining, it's very much the same. So I believe there are models that that are that exist that everybody understands. And we can use those models to have these conversations in ways that are more meaningful, both to the cannabis newbie, as well as other people that just understand aromatherapy. And now they can use it as a mental model to better understand how cannabis might affect them.
David Goubert
I fully agree with you and don't pretend on my site to be an expert at all. And so nutrient in the industry and the to your point, I think that there there's I'm not going say a void, but there's an opportunity for sure, from an education standpoint and from a building the tools, system availability that actually speaks to what we're talking about today. And also, from a product standpoint, how they can help. I think that on supports where bud tenders and complements were bud tenders and also to help in the topic that we had before about how do you break this barrier and make it actually something more inviting? I think that there's a there's a void there and we've been talking about it about hey, how do we figure out a way to, to support on that front? For air and somehow for the industry so fully agree with you?
David Paleschuck
Yeah, absolutely. Well, you know, the one thing we always do is we always have audience participation. And, and our audience is always so great at participating. And I know that we're, we're going through, we're going through our conversation, and time is just slipping by, so I just want to jump to our first CannaQuiz. So Cannafact or Cannafiction? According to the two industry analysts by 2026 80% of cannabis sales will be adult use and audience, we're curious to get your thoughts on this. What do you think 80% of cannabis sales will be adult use?
Adriana Hemans
That Yeah. And that distinguishes adult use versus medical?
David Paleschuck
That's right. Forgive me. And, and oftentimes, you know, that's, that's, that's even a question in itself. Right? Am I purchasing adult use cannabis? Or am I purchasing medical cannabis? Right?
Adriana Hemans
Yeah, I think they mean like it within the states, like the revenue of the state that allows medical only versus adult use. But as we know, there's a lot of you know, muddiness there. I see a lot of guesses coming in for a fact that this is a can affect. And since we're talking about medical, I'm curious if you think, David, that because Pennsylvania has a strong Medical program, that's why the terpenes are spreading. Yeah.
David Goubert
Yeah, that's, I mean, that's how I've been described. The also the reason why, in Pennsylvania, that being said, Florida is a medical market. And, and it's not as true in Florida versus how important that seems to be in Pennsylvania. But I would say that it's probably a good reason to explain why it's so present in Pennsylvania, but again, doesn't seem to be as true in Florida today. And maybe the maturity is not the same in Florida versus Pennsylvania.
David Paleschuck
Interesting. Well, we I mean, we have a lot of people, we have a sort of a split group here. Some people saying fat, some people saying fiction. David, do you have any thoughts on cannabis sales being adult use or 80% of cannabis sales being adult use by 2026?
David Goubert
But quite frankly, it's hard to tell. So it seems maybe a bit high to be at 80%. It's, it's clear that as we see states moving from being medical only to be medical and adult, that has a very positive impact from a from a revenue standpoint and increase revenue versus ugly, obviously, simply by giving the opportunity to more people to become customers and consumers. So then as to say that, that it's probably a bit high. If I refer to Ayr we're not that I don't think we'll be at that percentage, three years from now. So that would be my guess.
David Paleschuck
Well, let's, let's show the answer that there we go.
Adriana Hemans
Cannot fiction. I know that Kim Nicole Casey got it. Correct. Good job. Yeah, it's and this is from MJBizCon. Biz Fact Book that they released last year, it will be 71% will be adult use is their estimation by 2026.
David Goubert
Right? You know, when I see this, this slide, and this page, what I look at and what I love to see here is that we're moving from 27 billion in 21 to 53 billion in 26. So it's 25 will be 5075 and 100. In some time.
David Paleschuck
Yeah. Yeah. And that just came from MJ biz daily, which the information is from June 2022. So it's relatively recent. And it's nice to see there's growth.
Adriana Hemans
plenty of growth, which is awesome. So we were talking about state markets. Let's get into that a little bit more let's get into this strategy of where you put your energy as a giant multi-state operator How do you know when is the right time to stick it stick it out and when is the right time to try something different?
David Goubert
So this is such a unique industry like I tried to coming into to figure out who are we right we're a cultivator we're the same time we're processing and manufacturing products that you can sell in the in the states that were you cultivating and process were at the same time a retailer with at stores your point and at the same time, we're selling wholesale to others and we're buying products for others and I was trying to find some other industries where it could relate to in terms of what they are and could not. And then I was like, Okay, let me think about what I know. And what I know is that kind of luxury world and retail and CPG and retail world. And I think that at our small level in cannabis were at the same time a retailer and a CPG brand and took Do some parallel again at our small level where a Sephora and L'Oreal at the same time. So as a Sephora, you're a retailer the assets of the retailer in this world, country to maybe 10 years ago, 20 years ago, the assets of retailer is its customers, it's building a loyal customer base. And at the same time, were the CPG companies that that build brands, and, and manufacture products with the right quality for those brands, like L'Oreal would do in, in in beauty. And when you think of that are out assets is the quality of our products and the equity of our brands. And that's where we are at the same time, which is different than what exists in other industries. The beauty of that is that if we do a good job as a retailer to develop a loyal customer base, and at the same time, if we do a good job as a hustle brand, to develop brands, we actually have a very great flywheel, a great virtuous circle, where your customers, you introduce them to your brands, and then the brands through whole seven other places you introduce through those customers to your retail. So this is actually a really interesting flywheel that we have. So back to your question, I ran out about the states. What that works only if you have debt that's works only if you can create enough presence in front of customers, that you can build that income of building a customer base, but also building the equity of your brands. And so when we're thinking of the states, where we are, and the one that we've decided recently to disinvest in Arizona, that is done thinking about that? Can we be in a state where we have enough presidents that were broad enough that we have enough depth? That actually we can build a loyal customer base, but we can also build equity for our brands. If the answer is yes, then let's invest more and less creative and more depth. If the answer is no, it's going to be hard, then it's rather better to not put too many too much invest investments or disinvest. From that state. So that's how we've been thinking of the different states. And thinking that where we should focus are the states where we can actually build that build up depth and create that that virtuous circle.
David Paleschuck
Interesting. And I love the I Will concept as well. You know, often when I think of retailers, if you will, I believe retailers have an opportunity to get the eyeballs of the consumer way before they're in the store, if you will, probably a bad example. But McDonald's, you see the golden arches, you know, from the highway way before you're even at or close to McDonald's. In this case, in the cannabis space, those that own dispensaries and retail outlets have that same ability to touch the customer before they even walk into. Could you talk a little bit about that, that opportunity to touch the customer before they're even inside the store versus either your competition or in other situations? You might be just the brand sitting in a dispensary? And so it's a different approach. Could you talk about that?
David Goubert
Yeah. And that brings me back directly to the previous points about, hey, we're at the same time a retailer and a house of brands. And from a marketing standpoint, from a branding standpoint, you got to think about them separate differently. So to your point, as, as a retailer, you got to figure out ways to really brand your stores in a way that the customers will recognize them before they enter into the stores, whether that's through outdoor advertising, whether it's whether it's through digital touch that we can do. And at the same time making sure that you get a consistent name and a consistent experience if you want across the different retail stores and states you're in, which by the way for us is air cannabis dispensary. And it's going to take time in some places to get there versus faster in other places. But really the way is to create that consistent approach on the retail brand. Now we're also a house of brands and from building awareness about your brands, then it becomes very different tactic. Because it's not about a location. It's not about driving someone to a space. It's actually building the audience building truly a following On your brand. So you get that through your retail. And you get that through the wholesale presence that you have. You can use social media, you can use other digital tools, I would say to build that, that awareness and equity for your brands. So we're taking that step back of thinking, hey, it's a different approach. It's a different strategy, thinking as a retailer, and air, right, and thinking as a house of brands, where we need to build brands. And we have work to do, by the way, on rationalizing and redefining our brands, but building brands that can have their whole life, and where you can build that awareness and that following to those brand salong this line, and we're looking at some images of some brands. And these are just a few of the very many that you have.
Adriana Hemans
I know that some of your growth comes from growing these brands internally and some are from acquisition, can you talk a little bit about the advantages of one over the other?
David Goubert
Yeah. If you look at the company and air, basically, air was born three and a half years ago by acquiring five companies and then adding another 10. to that. And with that came some brands. And then some others were built in house as brand that were built in house. But I would say those came as the company was going through these, the Cyclopes is the only brand where it was a clear decision to buy a brand fully brand was when we both Levia in the in the beverage category. And that to me is the only brand if you want to know our portfolio, for which the decision was hey, we want to build a two by Levia as a brand, and for the equity that is in the Libya brand. For the others I would say whether they came through an acquisition and whether they were built, it was more of that same principle of building a brand she wants within your company. That being said, I think that today when you think of the industry and how far fragmented the industry is and what we're representing industry, we got to be realistic about how many brands can you truly develop? How many brands can you really invest in? How many brands can you really get customers to actually recognize and appreciate and really self-following. And we have a rationalization work to do to make that something that's more manageable internally, and recognizable externally. And the other element to that is I think that we need to trust the customer with the same brand throughout their journey, their Kennedy's journey, and not necessarily only in one category. So there's a big chance to come which is the brand can at the same time be flour, preroll vapes edibles and things like that, but much more thinking of the customer. And the customer that throughout their journey will consume those products at different moment.
David Paleschuck
Agreed. I think I think that's well said I often think of if people buy into the backstory of a brand, they're more likely to buy into the different form factors that that brand will offer to them, allowing them multiple touchpoints at different parts of their life. Yeah, yeah.
David Goubert
And I'm asking people around me about it about hey, how do you how do you what's your, your candidate journey and then making the parallel about Yeah, and he's kind for example, for us who's a key brand. Kind can be your brand for when consuming flowers the same way it can be when you're taking any bills in the evening or something like that. So I think that's a journey for us to be thinking that differently. And quite frankly, this industry is so fragmented, we're saying today, it's 26 billion. We're about half a million, and we're in the top 10 of the MSOs with only 2% of market share. So it's extremely fragmented, and neither do we have the power. Nor can we create enough points of contact, I would say, to develop 12 brands at the same time.
David Paleschuck
Yeah, it's all about efficiencies and kind of economies of scale. And, you know, again, touches into your background of both branding and operations, as well. You know, we, we do ask a question of our guests, you know, every show and that's to recommend a book or a movie or an experience or something that you have found intriguing that Have you might want to be you might want to share with our Is there anything you would recommend?
David Goubert
Yeah. And you had asked me that question in advance that one. So I started thinking about it thinking about movies or documentaries or things that I watched and that were important to me or change something to me. But rather than that, actually, I'm going to talk about a series of experiences, I'm going to call them series of experiences. I came into the industry. Really, because I felt it was the time for me to have an experience in working something that is for the greater good, the purpose of the companies to be a force for good. And I love what Vicki was saying about the kind and caliber haven't had the chance to read that what you were writing before, but really, I came to the industry because I really believe in being a force for good. And as I was visiting our I am visiting or meeting our teams, the very first question I have every single time to every person is Why do you work in the cannabis industry? Not why do you work at air? That's probably the second question. But the first question is, why do you work in the cannabis industry? And I probably have asked that questions 100 times now through the visits and meeting people. I've had only once the answer being because I needed a job. Every single time it's been because somehow cannabis has been part of some of each person's life and as help someone around them or themselves, or made such a difference in their life, that that they wanted to give back. And they wanted to be part of the industry. And hearing that every time. Got me to a place where it's like I'm in the right place, based on what I want to do, I'm in the right place in the right industry, because we can make a difference. We can be a force for good. And really that that stays something that give keeps giving me goosebumps on how much it makes sense, let's say to be part of, of this.
David Paleschuck
That's I mean, I appreciate that answer. And that's really special for somebody that has so many years of experience in business, to come into the cannabis industry to be a force of good. And to get goosebumps, that's some that's something we need to replicate more often. And we really appreciate that.
David Goubert
Well, thank you very much.
David Paleschuck
Thank you. Well, we've come to the to the end of our show, David, thank you so much for joining us, we really appreciate your insights. And in the skill set that you bring to our industry, we need people with real world skills, but that are also here to learn about the plant and to be a force of good. And you've clearly showed that today. And we thank you for that.
David Goubert
Thank you very much. And at the same time, I really want to say that we have amazing teams, and I've met people that have been in ministry for years and are absolutely amazing. So there's so much to learn from the team that is here. And I think the recipe is a mix of amazing talent that has been, you know, in the cannabis industry for very long, mixed with a few people that can bring different expertise and, and experience and journey to add to it. But really want to end by recognizing the talent that is in industry and has been in the industry for.
David Paleschuck
Thank you. Yeah, thank you for that, David. And just to come back on my statement. I believe there's great people in the industry already who have brought it to where it is. And so I don't want to forget about them. And I didn't think I was forgetting about them. But David, thank you so much. We appreciate what you do. We appreciate your experience. And we appreciate your insight and sharing it with us today. Thank you.
David Goubert
Well, thank you both for having me. And thanks for everyone to be here. Thank you.
David Paleschuck
Thank you so much. Bye.
Adriana Hemans
Wow, goose bumps. Yeah.
David Paleschuck
As always, we always have goose bumps at the end of our shows, don't we?
Adriana Hemans
Yeah, it's a great way to close it out. So please go follow us. Follow our LinkedIn page branding. By live we always have updates on who our guests are coming on next week. You'll never have to miss an episode you'll be able to find out all the hot tea by following #brandingbudlive.
David Paleschuck
That’s our show for today. We’ll be back again next Thursday, March 23rd at 11a PST / 2p EST for "Fragmented and Flourishing: Event-based Branding in Cannabis." Our guests next week are George Jage, CEO of Jage Media - the company that brings us MJ Unpacked twice a year, and Sid Patel, CEO of the Beverage Trade Network and the creator of the Cannabis Drinks Expo.
Adriana: We just dropped a link in the chat for next week’s episode. Hit that button to register so you don’t miss it. If you miss us in the meantime, you can re-watch today’s episode, or any of our previous episodes, on our LinkedIn page, Branding Bud Live, or on our YouTube channel. Please give us a follow on LinkedIn to stay on top of everything BBL.
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