The CBD industry is flourishing, but one of the most significant challenges CBD brands face today is complying with stringent communication regulations, particularly around SMS messaging.
Given these strict regulations, CBD brands must navigate these challenges carefully to avoid penalties, maintain effective customer communication channels, and continue to increase customer retention. A majority of brands have begun to forgo all SMS communications with customers to avoid risking penalties from regulations.
Tyler Craig, CRO of Blustream, recently joined a webinar hosted by the National Animal Supplement Council (NASC) to discuss the intricacies of CBD communications regulations and the next generation solution to enable direct communication with CBD customers.
Couldn’t make the webinar? Don’t worry, we have you covered!
Breaking Down the Success of SMS Messaging
One of the primary reasons SMS is so successful is its unparalleled engagement rates.
Statistics show that 86% of businesses report higher engagement with SMS compared to email. This is largely due to the nature of SMS—short, direct messages that are less likely to get lost in the clutter of an inbox.
The speed at which SMS messages are read is another factor contributing to their success. An astounding 90% of text messages are read within three minutes of being received. This immediacy is unmatched by any other communication channel.
So, why is SMS the preferred communication channel?
Personalization is no longer just a nice-to-have; it’s an expectation in after-sale service. Two-thirds of consumers expect personalization from the companies they buy products from.
SMS allows for highly personalized communication, making it a powerful tool for building and maintaining customer relationships. With SMS, businesses can send tailored messages, rather than a mass email blast, that resonate with individual customers.
Regular, personalized communication keeps customers engaged and reminds them of the value they receive from your product and company as a whole. Whether it’s a reminder to reorder a consumable product, an update on new releases, a special offer for long-term subscribers, or if you're using Blustream, guided support learning about using your products, SMS keeps customers connected with your brand and products.
The Regulatory Landscape around SMS Messaging in CBD
One of the most significant challenges CBD brands face today is complying with rigid communication regulations, particularly around SMS messaging.
As we’ve illustrated, SMS is a vital channel for customer engagement and revenue generation, but recent regulatory changes have imposed severe restrictions on its use for CBD companies.
The Cellular Telecommunications and Internet Association (CTIA) has extended its SHAFT regulations—originally targeting messages related to sex, hate, alcohol, firearms, and tobacco—to include CBD products. This extension means that any SMS communications promoting or discussing CBD products are subject to strict scrutiny and potential penalties.
The Federal Communications Commission (FCC) imposes fines ranging from $500 to $1,500 per unlawful message, and carriers block messages that aren't legal in all 50 states. These penalties not only impact the immediate communication capabilities of CBD brands but can also result in long-term bans on sending any SMS messages.
With SMS falling under heavy regulation, it’s time for CBD companies to explore alternative communication methods.
The good news? SMS is just one delivery vehicle.
The Blustream Solution: Next Gen Communication in CBD
Blustream offers a groundbreaking solution to the challenges posed by SMS regulations.
Blustream’s next generation product concierge messaging channel for CBD companies offers a web-based alternative to traditional SMS that complies with all regulatory requirements.
This new channel utilizes a cloud-based messaging format, providing a connection point to the customer via the cloud. The channel mimics SMS by enabling customers to send and receive messages in the same space where they view other text messages. Additionally, the channel provides a richer functionality than SMS with the ability to embed videos with autoplay and mute capabilities as well as provide multi-select responses without needing customers to type a reply with their choice.
Combined with Blustream’s Product Ownership AI, this platform allows for highly customizable interactions, offering a range of information such as FAQ sheets, product tutorials, and personalized messages delivered at exactly the right moment in the product and consumer lifecycles. By offering timely and relevant interactions throughout the product lifecycle, the platform can enhance the overall customer experience. Satisfied customers are more likely to continue their subscriptions, upgrade to higher tiers, or purchase additional products and services. In fact, returning consumers are worth 10x their first purchase. This increases the customer lifetime value and generates more stable revenue streams for subscription-based businesses.
In addition, this new channel enables the collection of zero-party data, where customers voluntarily share their interests, preferences, and motivations. This data is invaluable for creating rich customer profiles, allowing for highly personalized and relevant communication. By understanding the entire ownership lifecycle, companies can tailor their messages to meet specific customer needs, driving loyalty and retention.
How Blustream Enables Seamless Integration
Blustream’s new channel is designed for easy integration into existing customer touchpoints.
Whether through a link in a marketing email or a QR code on a product package, customers can access the cloud-based platform effortlessly. This direct connection creates a seamless user experience, making it easy for customers to engage with the brand and access valuable information.
The steps to implement Blustream’s new channel are simple:
- Identify Customer Touchpoints: Determine the most effective touchpoints for integrating the channel, such as emails, QR codes, or social media links.
- Customize the Platform: Tailor the messaging platform to align with your brand and customer needs, incorporating personalized messages, FAQ sheets, and product tutorials.
- Launch and Monitor: Implement the platform and continuously monitor its performance. Use analytics to track engagement and adjust strategies as needed to maximize effectiveness.
Once the new channel is integrated, you’ll see results in no time.
Companies that utilize Blustream report a 40% increase in customer retention and a 30% lift in revenue. By maintaining continuous and personalized communication, this new channel helps CBD brands build lasting relationships with their customers.
For instance, if a customer is using a CBD oil for sleep, personalized educational content can offer insights on optimal usage times, complementary relaxation techniques, and how to integrate the product into their nightly routine. As customers become more familiar with the product, they can receive more detailed information about its benefits and advanced usage techniques, increasing their satisfaction and loyalty.
A New Era of Customer Engagement in the CBD Industry
The regulatory landscape around SMS messaging in the CBD industry is complex and challenging. However, Blustream’s new channel offers a viable and effective alternative, ensuring compliance while maintaining high levels of customer engagement.
By leveraging cloud-based communication and Product Ownership AI, CBD companies can deliver personalized messages at critical moments, driving loyalty, retention, and revenue.
Embrace Blustream’s innovative solution and transform your customer engagement strategy in the CBD market.
It’s time to give your product a (non-SMS) voice! Watch the full webinar now.