Paulo Lacerda Sobral On How To Grow Cannabis Drinks Awarness
Throw a party and serve cannabis beverages. Humans are social creators, and going back to ancient civilizations we drink in social settings and rituals.
Paulo Sobral is General Manager for the Platform Beverage at Cann. Cann is the best-selling multi-national THC beverage in the world. Paulo oversees their expansion into new brands and beverage categories.
Paulo has extensive experience working with a diverse spectrum of cannabis beverage brands. His first foray into the category came in 2019 as the first sales hire for Vertosa (then Nanogen), a leading provider of water-soluble cannabinoids. Here, he saw the many challenges in the category and opened his own consulting firm, Drink Cannabis Consulting. Drink Cannabis Consulting led the commercialization of cannabis beverage projects and go-to-market strategy. Paulo has offered his insights to multi-national beverage companies and pre-revenue startup companies.
Prior to working in the cannabis industry, Paulo worked in sales management roles at PepsiCo for 6 years. Paulo's mission in cannabis is to destigmatize cannabis and improve worldwide consumer access.
Image: Paulo Lacerda Sobral
Your Place Of Work
Tell us a little about your background and journey into Cannabis
I entered the medical cannabis industry in California in March 2016. I worked at PepsiCo for over five years before I decided I was ready to move on from a corporate career. Growing a company and industry sounded far more fulfilling. I became fascinated with cannabis in my early 30s. I watched a documentary that opened up my eyes to the real medical benefits of the plant. While it was always around me growing up, I stayed away out of principle and ignorance. I sat there and watched a father telling a passionate story about how CBD oil saved his kid from epilepsy. It made me curious enough to study the history of prohibition. After some research, I felt comfortable enough to get some flowers and research how to make my own edible. It was love at first bite. I figured it would only be a matter of time until ignorance is reversed and this plant becomes federally legal.
Explain your current role
I'm the General Manager of California and our Platform Beverage at Cann. Cann Social Tonics is the top-selling cannabis-infused beverage in the world. I provide cross-functional leadership on our expansion to new cannabis beverage brands and partnerships and also oversee our retail partnerships and sales operations in our home state of California.
What trends do you see in cannabis beverages?
The cannabis drink category is evolving. In regulated markets early sales trend towards classic products (flowers). Innovation takes time to incubate and iterate. Products makers put products to market emphasizing THC potency and cost, knowing that will sell. The cannabis beverage category needs diversity in both product and brand, to be a viable category for the consumer. More beverages focusing on ingredients, flavor, and functional benefits will hit the market. Cann leads the change to put the priority on flavor and quality for people who want to enjoy a nuanced beverage experience. I'm excited to taste some new beverages featuring single-origin cannabis and feel the effects of some minor cannabinoids in the near future.
Image: Paulo Lacerda Sobral
What tips do you have on growing the category when it comes to product development?
Get inspired by life. The cannabis plant is such an amazing multi-tool. I've used it enough to know what various cannabinoids and terpene amounts do to my body. Prohibition has robbed us of valuable research on the efficacy of the hundreds of cannabinoids and terpenes in the plant. As a result, I have to speak in anecdotes more than I'd like. I recommend product developers get first-hand experience with ingesting cannabinoids. After experimenting, I know what different blends do to my body and mind. I most often use cannabis to help me with the task at hand, whatever that is at the moment. Different jobs call for different tools. We can engineer efficacious beverages that meet a variety of mood states. You need to get excited about making something that can help people. Here's a practice I like to do. Think of some activities you enjoy doing often. How about dancing? What drinks do people enjoy in those settings? Sangrias? Aspire for a tasty, natural sangria infused with a blend that makes music easier to move to. Finally, this category is small but has been around for four years. Make sure your suppliers and partners have operated in this category already, or do it yourself. These products are too regulated to risk to amateurs.
What are the 3 things that we can educate end consumers more on in growing end-consumer awareness?
First, we need it legal for consumers to have access. They shouldn't care if they can't even buy the products, outside of inspiring them to vote. Otherwise, in legal markets: 1) Fewer calories and hangovers than alcohol. The health benefits are obvious. 2) The onset typically is under 15 minutes and exits within 3 hours. 3) You can't die.
Which states / markets do you think present good growth opportunities for cannabis beverages in 2023-2024
Everyone is looking at New York, including those of us at Cann. The state has a large population and a huge amount of tourism. I am concerned that the unlicensed market will continue to dominate and the state won't eradicate its presence. I've been in the industry here in California since 2016. Our local government has over-regulated the licensed market and ignored the unlicensed presence at the same time. Will New York do better?
What do you think are the current challenges in the cannabis beverage category
It is expensive. We have a supply chain that can't scale, and different regulations in fragmented markets prevent economies of scale. The result is unit COGS are far more expensive than Soda or Alcohol as examples. We still have a limited amount of retailers in every market. Without mass distribution, cannabis beverage operators will struggle to scale and remain profitable at the same time.
If you were to give advice to a first-time cannabis beverage consumer, what tips would you give?
Buy something low-dose, under 5 mg of THC. Wait 20 minutes and see how you feel. Remember, you won't die.
Your favourite cannabis beverage brands?
My favorite product on the market is Thunder, our yerba mate-based cannabis-infused energy drink. It's for the everyday cannabis user who still likes to get shit done. The effect is a motivated, energized, focused high similar to how we categorize the effects of sativas. I have too many friends behind too many brands to list names. One new brand I will call out that has yet to hit the market is the Sunstone Spritz. Sunstone is a multi-decade winery in Santa Ynez, California. Their Spritz line will feature single-origin, Santa Barbara estate-grown rosin. It's the first wine brand to crossover to cannabis.
What do you look for when you purchase a cannabis beverage brand?
Because I'm a nerd, I go straight for the ingredients panel. I look for low sugar content, natural ingredients, and a desired effect for the intended use and time of day.
Any out-of-the-box ideas you have for bud-tenders in promoting and educating the cannabis beverage category?
Throw a party and serve cannabis beverages. Humans are social creatures, and going back to ancient civilizations we drink in social settings and rituals. People don't want to be promoted to or educated as much as they want to have fun and break bread with their peers. Look for this to happen this year, follow me for the announcements.
If you were to make a new cannabis beverage today? What sort of product would you make and why
I am making new cannabis beverages today. You'll just have to wait and see.
If you were to market and distribute that cannabis beverage, what would be your top 3 areas you would focus on?
First, define exactly who the beverage is for. The best brands are viewed as an extension of our best selves, and we're all tribal in how we define ourselves. Beverage brands that try to please everyone end up getting ignored. Second, what's your customers' reason to believe in the brand? This is your messaging, and it must be clear and consistent. Third, protect the retail penny profit. Your product must have the right mix of margin and sales velocity, or nothing else matters.
Paulo Lacerda Sobral will also is speaking at the Cannabis Drinks Expo in San Francisco on July 27 and in Chicago on August 1 you can secure your tickets for San Francisco here and Chicago tickets here. The 2023 show will focus on helping anyone looking to get into the category learn and develop new products, it will help existing brands expand into other states by meeting other state manufacturers. It will help retailers and distributors find unique new brands and also develop their store-own brands, it will find new ways cannabis beverages can be marketed and sold.