Short-research firm Friendly Bear mounted an abortive attack on Hexo with accusations Hexo was “running aggressive product promotions on Snapchat as recently as June 2019.”
- Calling its findings “Canntrust 2.0,” Friendly Bear claimed “We see significant similarities between CannTrust and Hexo,” and imagined Hexo “the next victim of the Summer of Cannabis Scandals” (bold Friendly Bear’s).
- Though Friendly Bear insists Snapchat is “synonymous with teenagers” and ad slogans like “A Fresh Spark” and “Are You Ready” encourage “risk taking, and [associate] Hexo’s brand with ‘glamour, excitement, and vitality” (contrary to Health Canada ad regs), it was hardly on par with growing 12,000 kilos of cannabis in unlicensed rooms and deliberately deceiving Health Canada regulators.
Neither Hexo nor investors found the attack convincing. Hexo told media it was ” scrupulous in adhering to rules and regulations surrounding cannabis promotion, both federally and provincially,” and added it geo-fences ads to prevent from breaking provincial law. Stocks actually went up following the release of Friendly Bear’s report.
Bloomberg
- This opened the discussion about the regulatorily complex practice of LPs advertising on social media. LPs may advertise in age-gated areas, but they are still bound by limits on their content.
Marketwatch - Aurora has also advertised on Snapchat, while Zenabis advertised on Twitter.
- Social networks themselves generally claim they won’t advertise cannabis, but few seem to enforce anti-cannabis policies.
Quick Hits
- Molson Coors CEO Mark Hunter, who championed the brand’s partnership with Hexo, will step down after 17 years helming the beer company. He’ll be replaced by head of US operations Gavin Hattersley, who is also eager to buck declining beer sales with cannabis drinks and “spiked seltzers.”
Global News, CBC Business - Cronos acquired US CBD-infused lotions-and-edibles company Lord Jones in a USD$300M deal. CNBC, Bloomberg
