This week’s Trailblazer is Steve Hegedus, CEO of Wayne Patrick Consumer Products, a licensed producer now supplying affordable world-class cannabis products across Saskatchewan, Manitoba, Ontario and Quebec. Steve brings over 15 years of general and operational management experience working for Dermalogica Canada and Vida Wellness Corporation, as well as his own management consulting across various industries. Steve gained an appreciation for the cannabis industry through his extensive years of working in the health and wellness industry. He sought to create a craft producer that would bring premium quality products to the market, at affordable prices.
Questions with a Cannabis Industry Trailblazer
When did you first become involved in the cannabis industry and why?
To be honest, I consumed and enjoyed cannabis in my teens while growing up in Southern Niagara. Later, I was working as the National Operations Manager for a Unilever brand in Toronto, having spent roughly a decade in that role when Cronos, the global cannabis company, opened an office on the same floor. I thought to myself, here’s an industry that is young, trendsetting, and exciting – let me apply! The rest is history.
When I left my traditional operations role, I opened a consulting service and was hired to do consulting work for both legacy and regulated companies. It was at that point that I became aware of an LP undergoing CCAA proceedings in the Ontario Court. And so, KushKraft was born, with this October marking our 37-month anniversary.
What has been the biggest challenge you have faced when working with cannabis companies/brands?
The marketing challenge I have found hasn’t been from working with other brands or companies but has been centered upon the Cannabis Act itself and our inability to market and advertise. Our packaging is full of lab statistics, warnings, and guidelines – not directions, recommendations, or actual product/brand information. The truth of the matter is we are not permitted to market cannabis in this current environment.
To compound matters, we have to actively stay engaged with our legal team to disrupt and derail black market producers or delivery services who copy our brand without authority. KushKraft is probably one of the most well-known cannabis brands in Canada, having been born in the years leading up to legalization, which was our attraction in the first place. But it has not come without its share of issues. But, thanks to the large, regulated distribution network, we are winning that battle.
If you could change one of the current Canadian or American marketing restrictions on cannabis, which would it be?
I can’t pick one – it would be every single restriction and barrier put in place. One can equate this industry to tobacco or alcohol or any other commodity with strict regulations.
We can’t advertise. We can’t promote. We can’t donate to charity. We can’t even sample our own products within our secure perimeter to ensure batches are sufficient for public consumption – unless, of course, we obtain yet another government license or permit for a fee. Last year, for the first time, we were allowed to produce and hand out samples of our product to Budtenders – that was a win! This win, of course, was overshadowed by the fact that we must pay an excise tax on the not-for-retail sale sample. Outcome – we cannot afford to sample certain products because it’s not cost-effective. So I ask, what marketing are we permitted?
In your observation, what marketing techniques or channels have been most effective for cannabis companies looking to connect with consumers?
We have found our best success comes from personally engaging Budtenders and store owners with samples (if allowable and economically feasible). Because we do not have access to standard marketing channels, going directly to those who recommend and sell our product has been our key to success. We do dabble in social media as well, but really, building a brand in Canada is building a cult following.
What is one tip or piece of advice you would give to marketers looking to enter the cannabis industry?
Have a long time horizon. If you search the Cannabis Act for the word “business” you will discover that the word exists as a definition of the word “premises.” There is no acknowledgment of business inside the Cannabis Control Act. It has only been a public health and safety experiment to the detriment of the government’s partners, licensed producers, and retailers. I hope this will change, but until there is an acknowledgment in the legislation of an actual industry or business, this will be an extremely difficult industry to work in.
A big thank you to Steve from Wayne Patrick Consumer Products for participating as this week’s Trailblazer! Stay tuned for another interview with a cannabis marketing Trailblazer next Thursday in the ADCANN blog.