Aphria Aims for Cannabis Lifestyle Branding

The company’s Joint Venture with branding group Perennial Inc. closed today, and may help propel Aphria’s brands.

Photo by S O C I A L . C U T on Unsplash

Aphria Inc. (TSX: APH) announced that it closed on a Joint Venture (JV) agreement this morning with DATA Communications Management Corp.’s (DCM) (TSX: DCM) subsidiary, Perennial Inc. DCM is a print and digital communication company that works to brand companies in the financial, retail, healthcare, consumer health, energy, and not-for-profit sectors.

The JV will aim to produce novel consumber-driven, recognizable cannabis-infused brands. While the JV says that it intends to produce more than just edibles and pot-infused beverages, some predict that when edibles are legal, beverages will make up a nearly 30% of the potentially $10 billion legal pot market.

Several pot stocks with beverage interests have benefitted from that potential market size, including Aphria Inc. While recreational cannabis products are now legal in Canada, edibles are not. That means users can currently buy dried flowers, oils and pre-rolled joints. However, edibles won’t be legal in Canada until next year.

Further, as cannabis companies struggle with low brand awareness, Aphria may be hoping Perennial’s global brand strategy expertise can propel their future product branding.

Preparing for cannabis lifestyle brands

The Leamington, Ontario-based Aphria is a low-cost producer in the cannabis sector.  Meanwhile its competitor Canopy Growth Corp. is better known for its Tweed brand.

“With this partnership, Aphria is advancing its industry-defining approach to developing the cannabis-based products of tomorrow,” said Jakob Ripshtein, President of Aphria.

“The long-term future of this industry will be driven by consumer-centric R&D, innovation-led product and brand development and the ability to execute. Aphria is setting this standard today. We will continue to pursue the most strategic opportunities and partnerships to bring consumer-focused innovations that define the future of this global industry.”

Perennial moves from branding to creating

Perennial Chief Innovation Officer Chris Lund addressed their role in the partnership in a press release. “The brands that stand the test of time are the ones created with an understanding of the marketplace,” he said. He said the JV will develop “original and effective answers to consumer needs, and a message that’s relevant to people’s lives.”

Lund continued “we’ve been the thought leaders behind our clients’ brand strategies, creative development and execution for over 25 years. Now, we relish the opportunity to create our own brands from scratch with Aphria, an industry-leading partner. We look forward to working with Aphria to bring innovative consumer-centric products and brands to life in the burgeoning cannabis market.”

The JV’s initial focus will be on cannabis-infused products for the therapeutic, medical and adult-recreational use markets. However, they intend to focus on creating novel products, product categories, and consumer-driven brands in the future.

Written by Jason Bagg

Mr Bagg has over 20 years experience in financial services ranging from Capital Markets to Private Equity. Mr Bagg has helped clients build wealth, reduce taxes and plan for retirement. Drawing on his experience, Mr Bagg has spoken on different panels regarding investing and has written numerous due diligence reports and white papers in this area.

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