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Nathan C. Kronschnable
Nkronschnable9671@student.egcc.edu
PSYCHOLOGY IN THE CANNABIS BUSINESS 2
Abstract
As a prospective manager in the emerging legal cannabis industry, one must keep
in mind several psychological factors in running such a business. Advertising and in-
store marketing are affected by psychology in any business. However, the cannabis
psychoactive chemicals that can provide both positive and negative effects to those
This paper uses psychological and business texts and reports, surveys, reports of
this controversial industry. The sure (albeit slow) deregulation of cannabis in the
well as the societal perception of ones business, and the effects of cannabis use
Advertising and psychology have been linked since the early 20 th century,
Advertising in Theory and Practice (Ciccarelli & White, 2015). In this text, Scott
of advertisements. Scott states that an object is perceived as nothing more than its
physical form unless it typifies to the person something which they have met in
their former experience (Scott, 1921). This idea, related to the concept of schema
For example, Snoop Dogg and Bob Marley are both famous, prominent
musicians who have expressed a positive attitude towards marijuana use who have
listened to music that depicts marijuana in a positive light. Due to this prior
experience, Scott may argue that a customer searching for a marijuana product
associate with positive memories (cannabis consumption with friends while listening
Scotts perspective was not the only early view of psychology in advertising.
John B. Watson, the psychologist who established the school of behaviorism, worked
in advertising for quite some time. He was initially hired by Stanley B. Resor of the J.
studies on the nature of consumer behavior (Bartholomew, 2013). The goal of this
cannabis business was his research on brand preference among cigarette smokers.
among high-quality brands (budget brands are often made with substandard
tobacco). Watson found that cigarette smokers tended to choose their brand based
on the atmosphere around the brand rather than the taste or smoking experience
more-or-less the same among cannabis producers, who must rely on brand name
differentiation rather than pure product differentiation. Therefore, (and Scott and
(Bartholomew, 2013). Thus, a cannabis company would need to market their house
brand in a way that attracts customers away from the celebrity-endorsed products
by associating the product with a positive atmosphere. One form of marketing could
be the use of odd-even pricing the idea that customers prefer prices not stated in
even dollar amounts (Ebert & Griffin, 2016). For example, $999.95 is generally
perceived to be significantly less than $1000, even though the difference is only
Store layout also plays a role in customer loyalty and retention. In a cannabis
business, the owner may elect to use a process layout; the process layout involves a
customer being catered to in a personal manner (Ebert & Griffin, 2016). This layout,
which provides the customer with individual attention based on their specific needs,
can foster a sense of security and of being cared for in a customer. This form of
is best suited for their recreational or medical needs, could greatly increase
owner of a cannabis business must keep in mind the social controversy surrounding
the commercial retail of cannabis products and convince the community of the
business benefits. Although most US adults support legalization, there are many
conservatives who do not (Geiger, 2016). Therefore, the social attitude toward
expression. One group that seeks to foster a negative affective aspect is Citizens
generalizations, and other logical fallacies in its press releases to appeal to the
affective component of individual attitudes (CALM). For example, CALM states that
the FDA has not approved cannabis as medicine, and therefore it has no medicinal
value. However, according to the FDA website, some cannabis derivatives (i.e.
Marinol, Syndros) have medical value. The FDA also encourages researchers
attitude, they will be more likely to purchase cannabis products. This behavior can
behavior (Ciccarelli & White, 2015). If the owner provides a high-quality product,
plays the biggest role in brand loyalty. The thoughts a consumer has about a
product, including prior experiences and memories, can foster customer retention
and therefore increase a cannabis business profits. However, the large variety in
social attitudes towards cannabusiness calls for a way to manage these crucial
perceptions.
PSYCHOLOGY IN THE CANNABIS BUSINESS 7
Kimberly Elsbach (2014) as the actions that are designed and carried out by
manager can perform a task out of any of the four action categories to improve any
even an anti-marijuana group. For example, the owner could improve the
chronic bronchitis and cardiovascular disease. However, these studies did not
adolescent cannabis users have found that adolescents can experience impaired
White, 2015). This is important for a prospective cannabis business owner because
Some studies, on the other hand, have found positive psychological effects
related to cannabis use. One study, performed at the University of Haifa in Israel,
In the control group, rats who experienced the shock exhibited alterations in the
reminders. However, in rats treated with cannabinoids after receiving the shock,
these increased levels of activity were not observed upon introduction of the
situational reminder (Korem & Akirav, 2014). This suggests that cannabis can be
study regarding the New Mexico medical marijuana program (which recently began
allowing cannabis prescription for PTSD). Via a self-report method, the study found
According to Dr. Samir Haj-Dahmane, increased stress levels lead to lower levels of
PSYCHOLOGY IN THE CANNABIS BUSINESS 9
endocannabinoids in the body, which in turn leads to depression. THC and CBD (the
most prevalent chemicals in cannabis) break down into similar chemicals that fit
suggests that cannabis products could help to replace the endocannabinoids lost
due to stress, and therefore enable more stable moods and behavior. Although
human trials have not yet been conducted, Haj-Dahmanes animal trials have met
Therefore, a cannabis business owner who sells both recreational and medical
recreational and medical). Cannabis can be something of a miracle drug when used
psychological health.
In conclusion, one who wishes to get into the cannabis business needs to
all businesses, but cannabis is unique due to its controversial nature. Therefore,
owner must also remain informed on the latest developments and studies regarding
the medical use of cannabis to provide the best and most accurate relief for their
manages to balance these psychological factors (and has a solid business plan!),
there is no reason that any cannabis business should not find success in the
References
PSYCHOLOGY IN THE CANNABIS BUSINESS 11
Ciccarelli, S. K. & White, J. N. (2015). Psychology (4th ed.) [E-book]. Available from
https://archive.org/stream/advertpshycho00scotrich/advertpshycho00scotrich_djvu.t
xt
Rough, L. (n.d.) 7 Celebrities With Their Own Line of Cannabis Products. Retrieved
from https://www.leafly.com/news/strains-products/celebrities-jumping-into-the-
cannabis-sphere
article=1042&context=journalismdiss
Ebert, R. & Griffin, R. (2016). Business Essentials (11th ed.) [Electronic version].
from http://www.pewresearch.org/fact-tank/2016/10/12/support-for-marijuana-
legalization-continues-to-rise/
Retrieved from
https://static1.squarespace.com/static/5541a76ae4b0175cee8827d0/t/55d11401e4
b0c6285c51b4da/1439765505986/Do-You-Know-Marijuana.pdf
PSYCHOLOGY IN THE CANNABIS BUSINESS 12
U.S. Food and Drug Administration (FDA) (2017). FDA and Marijuana: Questions and
https://www.fda.gov/newsevents/publichealthfocus/ucm421168.htm
https://www.researchgate.net/publication/248563854_Organizational_Perception_Ma
nagement
http://www.nature.com/npp/journal/v39/n12/full/npp2014132a.html
Reports of Patients Evaluated for the New Mexico Medical Cannabis Program.
10.1080/02791072.2013.873843
http://www.buffalo.edu/news/releases/2015/02/004.html
PSYCHOLOGY IN THE CANNABIS BUSINESS 13