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How Cannabis Companies Can Create Effective and Legal Text Message Marketing Campaigns

April 25, 2019 | Jeffrey Harris
Text Message Marketing Within the Legal Framework

No matter the industry, text message marketing is an extremely effective form of advertising. Today, almost everyone owns a cellphone that they keep within arm’s length at all times, and over 90 percent of people read their text messages within 5 minutes of receiving them.

Since cannabis companies cannot advertise through traditional public channels, text message marketing has become a popular method to reach customers. It has been proven to increase sales and also increase customer basket sizes.

Text message marketing regulation falls under the TCPA (Telephone Consumer Protection Act), a federal statute designed to safeguard consumer privacy. This legislation restricts telemarketing communications via voice calls, SMS texts, and fax unless the recipients have given their explicit consent.

Unfortunately, the TCPA rules and regulations can be somewhat confusing and overwhelming therefore creating some nervousness in using this amazing marketing tool to drive retail traffic and sales. Additionally, there are people who focus on trying to take advantage of upstanding companies by trying to scare them into paying big settlements by claiming that the TCPA rules were not being followed causing even more nervousness amongst Cannabis retailers/marketers. Two notable examples of this are in Florida where two lawsuits were filed by the same person, what is known to TCPA practitioners as a “professional plaintiff”. TCPA professional plaintiffs are common across all industries due to the complex nature of the Act. It is important to note, however, that the two Florida cases were eventually dismissed.

How to easily stay compliant

The truth is that all companies across all industries need to follow the rules that govern text message marketing. And it’s actually easy to set up effective text marketing campaigns without spending a lot of money on legal fees and without running afoul of the law. All that is required by the TCPA is the customer’s explicit consent to receive texts. There are two ways to receive opt-in consent from your customers.

The first way works as follows;

Upon enrolling into a retailer’s loyalty/text marketing program such as in this example of springbig’s tablet app (IOS), which occurs only once, the customer will be prompted to review the terms and conditions of their consent to the retailer which includes giving the retailer their consent to receive text messages and will then be prompted to sign confirming their consent. Of course, digital copies of all signatures are filed so they can be accessed whenever needed.

The second enrollment option can be used if the customer does not enroll while physically standing at checkout (like in the case of online ordering) works as follows; customers sign up for text message communications in one of three ways. Texting a dispensary specific text-to-join code, scanning a QR code, or through dispensary’s website.

They will then receive a text message to confirm they want to “opt-in” to the program and continue to receive texts,  by replying ‘Y’ to the message the customer has officially “opted-in”. If they do not reply ‘Y’, they will then not be opted into the text message marketing program of that retailer.

The final requirement to stay compliant with the TCPA is giving the customer the ability to easily opt-out. This means including something as simple as  “Reply STOP XXXX to stop receiving text messages” at the end of every text message.

The Way Forward for Text Marketing

The companies that left themselves exposed to lawsuits did so by not including a “reply stop” prompt at the end of every message thus making the customer have to actively contact the business to opt-out, something the TCPA does not take lightly.

But the careless mistake of a handful of people should not cause you to eliminate text marketing from your marketing strategy. There is no better way to stay in touch and build relationships with your customers than through texting. And remaining compliant is a lot easier than most think as long as you follow two simple rules. Make sure all customers can opt-in and make sure they can opt-out easily, it’s really that simple. So don’t sacrifice the incredible ROI provided by a text marketing engine due to fear of getting sued because some other less fortunate and frankly careless groups did. Remember “professional plaintiffs” operate by seeking out those who have accidentally neglected TCPA requirements. So as long as you don’t neglect the basic requirements there is nothing to worry about except that your competition is bringing in more revenue by leveraging text-based loyalty.