As cannabis dispensaries work to attract and retain customers, rewards programs have become an essential tool for building loyalty. But promoting these programs comes with a unique set of challenges. Cannabis advertising is heavily regulated, with rules designed to protect public health, prevent youth exposure, and ensure fair marketing practices. For dispensaries, navigating these restrictions while legally highlighting rewards offerings requires strategic planning, a deep understanding of compliance, and a commitment to following both local and state laws in their jurisdiction.
The Challenge: Cannabis Advertising Laws
Unlike mainstream businesses, dispensaries face limits on how, where, and to whom they can advertise. While specific regulations differ between states and even cities, common restrictions include:
- No advertising to minors: Dispensaries must avoid ads featuring youth-oriented imagery, language, or placement where underage audiences are likely to see them.
- No exaggerated health claims: Promotions can’t position cannabis as a cure or treatment for medical conditions unless explicitly approved by regulators.
- Placement restrictions: Many jurisdictions ban outdoor advertising near schools, parks, or transit centers. Billboards, radio, and television ads may also be restricted.
- Promotion limitations: States such as New York, Massachusetts, and California place tight controls on cannabis discounts, free offers, or buy-one-get-one promotions involving THC products.
Rewards programs can easily cross into non-compliant territory if they are seen as circumventing these laws. Dispensaries must therefore stay well-versed in the specific legal requirements of their state and local market when structuring and promoting such programs.
Designing a Compliant Rewards Program
The first step is ensuring that your loyalty program complies fully with all local and state laws:
- Avoid direct cannabis discounts: Where prohibited, structure rewards to offer non-THC incentives, such as branded merchandise, educational content, or invitations to store events.
- Verify legal participation: Ensure the program is accessible only to adults of legal age (usually 21+), verified through proper ID checks at enrollment and redemption.
- Document clear terms: Provide written terms and conditions that make it clear how the program works. Avoid language that could imply indirect discounts or inducements that violate jurisdictional rules.
Consulting legal counsel or a compliance officer familiar with local and state cannabis regulations is always a smart move when designing your program.
Promoting Rewards Legally
When it’s time to advertise your program, dispensaries should stick to approved channels and follow jurisdiction-specific rules:
- Use owned and age-gated channels: In-store signage, age-verified websites, direct emails, SMS (with consent), and apps are typically safe options for promoting rewards.
- Carefully vetted social media: Some jurisdictions permit age-gated promotion on platforms like Instagram and Facebook, provided the content does not include restricted offers or target underage users.
- Educational focus: Highlighting how your loyalty program supports community engagement, wellness education, or access to non-cannabis benefits can help meet compliance requirements while building goodwill.
Building a Culture of Compliance
Dispensaries should regularly review their marketing materials for alignment with local and state laws. Save records of all promotions, and ensure staff are trained on what is and isn’t allowed in advertising and rewards messaging. Conducting internal audits and consulting with compliance experts can prevent costly mistakes.
Final Thoughts
Promoting rewards programs in the cannabis industry requires care, creativity, and a strong compliance mindset. By respecting local and state advertising laws, dispensaries can engage customers effectively while protecting their license and reputation. Staying vigilant as laws evolve is key to long-term success.