Navigating Marketing Challenges and Opportunities in the Evolving CBD Industry

Hey, everyone. This is Victor from Digital Web Solutions. We’ve E coffee with experts. Today, it will probably be one of the most viewed, favorite conversation we ever had because Beau here. Then you might ask, who’s Beau? Beau a co-founder from Sunday’s Scaries, and he’s going to tell you a little bit more about the things he do. Please, Beau, thank you for being here. You have the stage, you have the floor. Go on.

Thanks for having How do you want to kick off? The origin story or how Sunday’s Scaries is the name?

I mean, go with them both. Just give your introduction to the people.

Yeah. My background originally is in finance finance hedge fund analysis, then went to hospitality, owned a couple of bars and restaurants, and then moved into CBD. So a diverse background.

Full crypto bro story, right?

Yeah. No crypto stops in there, though. Okay. Yes. Then we came up with the name Sunday Scaries in 2016-2017 when we were launching the company because a lot of the existing companies in the space were named Meta This or Canada or Cindy This. Yes. Very ingredient-based branding, and we wanted to make it fun. So Sunday Scaries is a term that there’s actually studies on this by monster. Com, by sleepjudge. Com, by LinkedIn, that over 90% of millennials suffer from Sunday Scaries. Yes. In a great alliterative term for the anticipatory anxiety you feel on Sunday afternoon when the weekend is ending, the impending doom of Monday is upon us, school work, responsibilities, errands, scheduling. We felt that that would really resonate with the problem that we were trying to create the solution for, which is the opposite. You have companies like Calm that invoke the solution feeling versus you don’t name a pain company pain. It was a little counterintuitive, but we got the name.

No, the name is great. The name is great. Everything is great. Then again, we’re talking about a pretty different market here, and that’s most of the things we’re going to be talking about today. If you could let us know, when and why did you start working with CBD? What happened? What was the moment you decided to shift for CBD?

There was an inflection point. My business partner, Mike and I, were just super stressed out running a full-service bar and restaurant. I think we had 52 employees at the time. Sixteen-hour day, seven days a week, you’re never off. You’re getting calls at 3:00 in the morning because a dishwasher got in a fight. Just things you have to deal with. We wanted something to take the edge off. Obviously, There’s a lot of other vices in the hospitality world. We wanted something that wasn’t simulating, but took that stress and anxiety away. So the inflection point was on a golf course. Our buddy, Garrett, gave us CBD. We loved it. We started taking it. This is 2017, and we didn’t When we searched to find a brand that would resonate with us, at the time we were 30 years old, we couldn’t find a brand that we really felt we connected with, I guess. Everything was ingredient named. And so we We started our own, started manufacturing our own gummies as a side project, gave it out to our family and friends. Eventually, it started taking off. People really liked what they were tasting. Cbd was also new at the time, so it wasn’t newsworthy.

No one knew what it was. It was really the initial marketing strategy was largely educational versus actual marketing. It was what is CBD? It went from there.

There’s campaigns about what is CBD. I saw a lot of them, actually, now that I’m remembering. Back in Brazil, we do have a very strict policy in terms of CBD. Here in Portugal, it’s way more open. But even so, you have several external factors when you consider the conversation regarding CBD. You have religion sometimes, you have some culture of shocks. I understand that it can be quite difficult. When talking about these early stages you were mentioning, currently, we know that Google and Meta are super against promoting CBD things or any other adult market content, right? Correct. But how was it back then when you started?

How was that a change? It was a dream because in early End of 2017, early 2018, Facebook didn’t even have policies against CBD because they didn’t even know what it was. It was so new as an ingredient in the market. Of course, the 2018 Farm Bill passed in December, really putting it into the mainstream media. We would just advertise gummies for anxiety on Facebook, driving to our product pages, and we scaled really, really quickly. Our first year, we went from basically zero to $2 million with a skeleton crew. And then Facebook caught on. And then that’s really when… Also at the time, influencer marketing was really in its infancy. So we’d have influencers. Creator wasn’t a term back then, but we’d have influencers that would have 50,000, 100,000 followers. They would be willing to post for $5 per sale, and they would convert really well. Because it just wasn’t a thing where influencers were promoting brands. So between Facebook paid and Instagram organic, we really grew fast. And of course, that changed really quickly at the end of 2018, which brought a lot of challenges. Cbd is virtually either prohibited or highly restricted on every major platform, whether that’s Google, Bing, whether that’s…

And then under Google, you have YouTube and GDN, PPC. Amazon actually bids on our brand keyword and drives it to fake hemp oil products. There’s a lot of difficulties there. We’re not Twitch, TikTok is restricted, X is now cannabis friendly, but your primary ones are really difficult to get by.

I see. Well, you mentioned influencer marketing. We were actually talking right before the recording about how I worked in this market, and I can actually see it happening, especially in the US at the time that you were mentioning. Did you see a lot of success in a specific region of the US with these influencers?

Major metropolitan area is always Chicago, LA, San Diego, New York, Houston, Miami, or Houston, Dallas, and Miami. More progressive, forward-thinking, early adopter, technologically advanced areas. Because like you were saying, the other counterparts to CBD as a cannabis derivative, you do have religious factors, you have government employees, military, who can’t take the products because they’ll test positive for marijuana as hemp and marijuana are both in the cannabis family. We did see a large growth in Metropolitan areas first.

Oh, I see. Yeah. Well, there’s also my father who is against CDB, but then boomers as a whole, they are in this situation. When we talk about boomers not being disrespectful at all, we usually understand that certain markets work better with millennials, Gen Zs, younglings, while others work better with older, more experienced people. But But as far as I know, CBD can be used by anybody starting from 21, 18, depending on the country, until they’re medical, their doctor says otherwise. In terms of data, what can you share regarding the demographic of your target, of your market?

It’s interesting you said that we actually, in our weekly meeting, my business partner and I just went over a November survey that our customers completed, and I can pull it up. That has the demographic breakdown that was offered by them.

Oh, nice.

Let me just grab that really fast. Check your time. On the age scale, children, state, age. Our lowest age bracket is 18 to 24. I’m not just taking on the survey. This is based on Google Analytics. We do see lower sales with boomers compared to our competitors, largely because we focus on stress, anxiety, and sleep, not pain, inflammation. And then we also… Our branding is very millennial versus medicinal or pharmaceutical, which a lot of CBD companies are branded as. So definitely our biggest chunk is 25 to 45. I’d even venture to 55. Fifty is the new 40, right? Yes. I mean, I’m almost 40, and I feel like I’m 28.

No, I hear you.

So, yeah, it’s really the millennial market that understands what the term means and resonates with our more irreverent deadpool-esque brand archetype.

That was actually what I was going to ask. If we’re talking about millennials and Gen Z being most of your target, we’re talking about people who love start selling and who love customer loyalty as long as you feed them. Them the right spoon. How do you approach these? They’re not issues, but how do you approach this side of the coin where you always have to keep them entertained and you always have to be top of mind so that another competitor won’t steal your thunder in their mind?

Yeah. So fortunately, while we don’t do a lot with original content, we have really good VPC creators, but we’re definitely not a content machine. But comparatively in our industry, we are a top content producer as far as funny videos and engaging content because most of the other companies in the CBD THC space are more dispensary, more our, like I said, pharmaceutical, medicinal focus. Why I think we resonate with Gen Z and millennials is we take the anti-hero approach.

Yeah, and work.

Everyone tries to be perfect, we’re the shining, glowing star. We’ll say, Look, we’re not fucking perfect. John McLean, right? He saves the day and the diehards, but he’s also divorced and an ex-alcoholic, right? Shrek, he’s a big ugly ogre, but he saves the kingdom. Exactly. That’s more reflective of us as a company and our customer base. It’s like, no one’s perfect. You have these flaws, but it doesn’t mean you can’t save the day and do the right thing.

That’s nice.

That’s more of the edgy, irreverent nature of our branding that we feel really resonates with our audience.

Makes sense. Actually, I was actually going to ask you about why you chose this, but yeah, it makes total sense being the anti-hero.

Like the dead pool of wellness.

Yes, exactly.

Everyone wants to be Superman and Batman, but we’ll take dead pools.

Yeah, I think Sonic 3 will come for the theater soon enough, and Shadow will be on the movie, and Shadow is Sonic’s anti-hero in the universe. I saw so much buzz about Shadow being there because He’s not a villain nor a new hero. He’s like, he’ll kick ass, but we’re not sure if he’ll help Sonic at the end of the day. No, that actually makes a lot of sense. Shadow will be there to help Sonic, but I imagine that a lot of tools have been here to help you across this journey involving marketing, involving customer experience, or anything else, of course. Can you share more?

That makes Yeah, that links into our marketing. It gives us spaces of communication and advertising and marketing that our competitors can’t really reach. We could put up a Facebook ad that said, Gummies to handle your drunk political uncle at Thanksgiving, right? But Charlotte’s Web and Med Terra, it wouldn’t make conceptual sense. It wouldn’t be in brand alignment if they made those types of Facebook ads. They’re more polished, well-rounded, great origin stories, but completely different from our own. It gives us that meme-esque edginess, funniness that really opens. If you’re going to get a new customer, one of the easiest way is to bridge that gap with humor to get them to appreciate the brand before making a buying purchase. Humor is really a bridge to new customers that we lean on.

When talking about humor, of course, being a Brazilian, we have so many comedians back home, and now we are coming to a point where the line between what’s comedy and what’s hurtful is super fun. Did you ever came across any scenarios where you tried to- No. We try to be edgy and brash or edgy and irreverent, but not brash and offensive.

There is a fine line between sarcasm and being irreverent, exaggerating something that’s normal. We do tote that line, but we don’t go into the offensive or brash Which category?

One question that I think everybody might ask themselves is, if, let’s just say, let’s start with the US. If THC was finally legal, because we’ve been talking about CBD so far, so let’s step up the game. Parents, please take your kids out of the sofa. But talking about what drives people to these products, the feeling of getting high, as we all say. Of course, we all, especially with Trump being reelected, this won’t happen anytime soon. But in a scenario where he maybe allows us, the Americans, to utilize it. How much do you see the market changing in terms of the established brands growing more and maybe more and more and more small ones arriving? But at the end of the day, have you ever thought about this?

Certainly. Trump was the one who signed the 2018 Farm Bill, de-scheduling hemp. And all of the THC that we sell is derived from hemp, but it’s chemically identical to the THC that you get marijuana. There’s a lot of… The biggest challenge now on the educational side is people… We sell THC gummies online across state lines, and it’s legal and it’s real. And people have a really hard time grasping that it’s the same THC that they’re buying, they’re getting in marijuana. It is. Delta IX is chemically identical, whether it’s derived from hemp and marijuana. It’s actually the differentiating factor between the two plants. They’re both in the cannabis family. As far as national legalization, we have too many other things to worry about. We’ll cross that threshold when it comes. As far as what will happen in the industry, I think there’ll be a lot of consolidation, but we have a good customer mode. We have a lot of brand loyalty, and we treat our customers really well. We’ll just stand behind our brand and do what we’ve been doing. As far as innovation and regulation, that’s what we want. We want more regulation. All regulation is going to do is block those barriers to entry that a lot of startups have.

So that itself will create a bigger moat around what we’re doing right now.

Sure. Makes total sense.

I wasn’t even- And then one thing in the US, there is a big social trend of social tonics, whether it’s functional mushrooms, psychedelics or cannabis, replacing alcohol. We’re seeing a lot of alcohol declining sales. Okay. That’s interesting. People are switching. One of our best ads is, replace three glasses of wine with one gummy. You’re not ingesting 500 calories.

You don’t have a hangover in the next day.

Now, 18 ounces of liquid, you don’t have a hangover, and you’ve got 17 calories in a couple of grams of sugar, right? Versus versus the latter. And so we are seeing a shifting trend. You see that with CAN, C-A-N-N, as a social tonic as well. It’s really taken Hollywood by surprise as an alcohol replacement in the form of a ready for sale beverage.

Now that it is actually interesting, the cigarette market in the US, how is it currently?

I don’t know anyone that smokes cigarettes. Yeah, me neither. I rarely see people smoking cigarettes. I mean, it’s something that doesn’t It’s not even cross my mind.

They’re using a lot of vapes in the US, right, as well.

Vapes. There’s obviously the big Jules Scandal, which is an awesome Netflix special. But yeah, vaping. Then in San Diego, Whether allowed or not, you can walk down the street and smoke a joint. As long as you’re not doing it right in the cop’s face, I’ve never had a problem with it. I’m not saying that’s illegal, but I’m saying as far as how society perceives it, if someone’s smoking a cigarette, people perceive that as significantly worse than smoking a joint or taking a vape hit.

Sure. Nicotine has more dangerous things in the system, as far as I’ve read, regarding when in comparison to marijuana.

Certainly.

Back in Portugal, at least, I think maybe because we’re talking about a country who is stopping time, stuck there. In the 2005, 2006 era, they were smoking a lot of cigarettes still. Vapes are becoming a thing now. There is, for example, one cannabis store right across the corner here, but it’s the only one in the entire town. We are still seeing a lot of places where this can develop outside of the I say, of course. Whenever people talk nowadays about developing a business, they talk about AI helping you with this business development phase. For you, has AI been helpful in any situation or scenario, SEO content?

Yeah, it’s a good bridge into SEO. We do use it for content, both imagery, video, and SEO, written content. Of course, it’s not copy paste, so it supplements with an in-house designer who’s phenomenal, and we use AI as a backbone to save him time. We use AI as a backbone for our customer happiness team for customer service tickets. As far as really interacting with customers, though, that’s all human. So we’re talking We don’t have anything AI interacting with customers. Probably not as significantly as we could be taking advantage of AI. But right now, there’s not a lot of openings that we can see for how it would optimize us further.

I was thinking about maybe creating an AI experience where users could scan a QR code in the bag of the gummy and it would take them to a conversation with a lot of image generated that would get them, I don’t know, crazy during the usage?

Yeah. The problem with AI for us is that the best features are largely tied to marketing and advertising. Yeah, sure. In which we’re already really restricted. But while there’s all these great AI split testing tools for Facebook business manager or MetaFit business manager for TikTok, for TikTok shop, for content creation and distribution, we can’t utilize because it will inevitably create restricted content that is restricted. We have to do that all manually right now.

Yeah, that makes sense. We have a lot of link builders watching here. Even in the link building part, do you see a difficulty in placing links over newspapers or other publishers who may not want to talk about it?

We have an SEO agency that we work with. We have I’ve organic link building as part of that, content building as part of that, schema and website architecture as part of that. From a technical and content backlinking perspective of the three pillars of SEO, AI is involved, but not on the execution phase. It’s more in research and developing fun ways to engage in content that save us time.

Yeah. No, not only does it make sense, but then again, I was in a conference some time ago and everybody was saying, Write human content. Don’t use AI anymore. Don’t write with AI anymore. You need authority. You need to be sure to show Google that you know what you’re talking about. And there will never be anybody better than a user writing about the things you do.

We will supplement. If we’re looking for three funny ways to reduce anxiety, certainly ChatGPT will be helpful for that. We do have a lot of content, but maybe Midjourney will be good for some high-quality life-like imagery, especially as we roll out new products. But other than that, everything is checked by my co-founder sits in the SEO seat. He’s really the human hand that flips the pages on the content that we’re distributing.

No, it makes sense. That’s actually one of the first things I ever think when I talk to people is like, what about their content? How do they do it? How’s their strategy? But that’s what you said. That’s what we’ve been talking about this entire conversation. It’s about demographics, who buys, where they buy, why they use it. Then after that, then you can come up with content. But alas, I think we’re almost at the closing stages here. The CDB industry is heading somewhere, usually heading forward. But a lot of things can happen. With the current economical situations, with the current marketing situations, with AI, with conflicts, with the elections being super strong everywhere in the world, how do you see 2025 for your market, specifically? Nothing happened besides what we have today.

One of our unique selling props is that we’ve really just focused on stress, anxiety, and sleep. And then that, obviously, in a larger nutshell, refers to mental health. But right now, regardless of the presidency and how you feel, there is an epidemic of mental health crisis in the United States. People are more anxious. I honestly think it’s just social media and phone addiction. But I think most of it stems from there. And so really working with the right partners, with the right creators, the right subject matter experts. For us, we’re just focusing on stress, anxiety, and sleep, and I don’t think there’s a shortage of that going into 2025. That’s what we wanted to solve for ourselves originally, what we still deal with and what we can still relate to. That’s what we’re looking to help other people with.

Sure. What you said about the current electoral situation in the US reminded me of American Horror Story Season 8. Not sure if you ever watched it, but I- I haven’t. I recommend it. I think it’s on Disney+, which doesn’t make too much sense, but still, it’s on Disney+, and it is about the fear because of Trump’s first election. You have talks about mental health during the entire season that could be avoided if they had the origamis. Season 8 is all on you. Yeah.

Like I said, regardless of what side you’re on for the presidency, it goes beyond that. I think it’s really just… Yeah, sure. I honestly think it’s social media addiction and people spending an average two and a half hours on their phones, especially for families. My question is, do you spend more time at the end of the day with your screen time or face to face with your kids or your loved ones? What we’re focused on is just providing incremental benefits through our gummies and our oils to help people take the edge off and reclaim that collected nature and just be able to disconnect from all the noise that the world spits out because it’s always available on the TV and on your phone, so it’s highly accessible. Just helping people out. That’s the ultimate goal.

Amazing. That’s great to hear. Anything next for you, for your company, for your life? Anything you’d like to share?

We’re launching THC Sleep Gummies. We’re also launching our first non-cannabis product, which is exciting. It’s two-pronged. One, we have a gap in our product SKUs, so it’ll be an energy and focus gummy that’s functional, mushroom-based. That’ll achieve two things. One, That’s what our customer base has been asking for, second behind Sleep Gummies. Second, it’ll open up all of those marketing channels that have been restricted to us for seven years. We can put them on Amazon. That’s going to be brilliant. We can put them on UGPC, we can put them on YouTube, you can advertise unimpeded on Facebook, Instagram, TikTok, TikTok Shop, TikTok affiliates. Amazing. That’s really the next realm for us is moving into a different vertical than just CBD THC.

Nice. I’m really looking forward to see what happens.

I know we’d actually be able to ship those to Portugal.

That’s what I was going to ask.

I promise you.

That’s what I was going to ask. My friends in Europe will ask, do you ship overseas? Currently, nobody will in the future with the non-CVB No, but we could ship you a bottle.

I don’t know that we’d expand. We were in the UK, which was a nightmare for a handful of reasons. A lot of novel foods, GDPR. There’s a lot of restrictions over there. Very expensive, too. But yeah, we’ll be able to ship our… Just for situations like this, we do a lot of podcasts. We have a lot of creators that are in other countries. Even Canada and Australia, we We can’t ship to for risk of being seized at customs. We need to respect international law, and we just keep all of our products in the US right now. Functional mushrooms, then we guys send something out.

No, I understand, but it is painful to hear, yes, because everybody, I think a lot of people will be very excited to have some gummy bears by their doors in two weeks from now. But who knows? The future is the only one.

Those should launch in Q1 after the holiday. Amazing. That’s where it’s subsided.

Amazing. Everybody, we need to stay in touch with the things that are happening here to be sure to have those gummy bears here in Europe. Well, Beau, I don’t think I have anything to add. I think we already talk a lot about Sunday’s Cares. This conversation has been amazing. I really appreciate you being here. I really appreciate you taking your time. Again, I’m super looking forward for the things that you’re facing, the things that you will be growing in the future. We’re talking about a very niche market, and everybody It deserves to grow, not only Apple and Amazon. Let’s go for it. Thank you so much again, Beau. Do you have anything else you want to say? Do you want people to follow you on your Instagram, LinkedIn? Do you want to shout out your handles?

Our Instagram is just @sundayscaries. No periods, no dashes, just @sundayscaries. If anyone, business owners, agencies, or contractors, want to reach out, they can always reach me at squad@sundayscaries. Com. It’s our partnership inbox.

We’ll put the information in the description and in the post as well. Everybody, just be sure to check every corner to understand where the informations are. Well, this is it. This is Victor. Thank you so much, Beau, again for being here. Everybody, thank you so much for billing and watching what we’re doing right now. I’ll see you in the next time. Bye bye, Bo. Bye bye, everyone. Bye.