High Spirits: The Cannabis Business Podcast
Hosts Ben Larson and AnnaRae Grabstein serve up unfiltered insights, reveal their insiders' perspectives, and illuminate transformative ideas about the cannabis industry for people who want to make sense of it all.
High Spirits: The Cannabis Business Podcast
#065 - Launching the Coalition of Adult Beverage Alternatives w/ Diana Eberlein
Curious about the exciting world of cannabis beverages and how it's reshaping consumer habits? We sit down with Diana Eberlein, a leading figure in the industry and current president of the Cannabis Beverage Association. Diana shares her journey from cannabis beverage consumer to chair of the Coalition for Adult Beverage Alternatives, shedding light on the strategic moves being made to align with the alcohol industry. With a recent move to Washington DC, Diana is at the forefront of policy advocacy, ensuring that cannabis beverages are both celebrated and understood.
The cannabis beverage landscape is ripe with potential, but not without its hurdles. Diana takes us through the intricacies of marketing and regulation, emphasizing the importance of consumer education to navigate the subtleties of dosage and intoxication levels. As the industry grapples with limited distribution channels, the conversation explores the potential of direct-to-consumer sales, despite the challenges it presents. Drawing comparisons with the alcohol sector, Diana shares valuable insights on collaborative marketing strategies and the nuanced relationship that cannabis beverages have with traditional alcohol products.
Join us on this enlightening journey as Diana reveals the role of passion and community in driving innovation within this niche market. We touch on the collaborative efforts of organizations like the Cannabis Beverage Association and Hemp Beverage Alliance that unite the industry to tackle regulatory challenges. From legislative education to forming strategic coalitions, discover the creative strategies being deployed to integrate low-dose beverages into mainstream consumption and the shared vision driving the industry forward.
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Hey everybody, welcome to Episode 65 of High Spirits. I'm Ben Larson and, as always, I'm joined today by Anna Rae Grabstein. It's Thursday, october 24th 2024. And today we're thrilled to welcome a trailblazer in the cannabis beverage sector, diane Eberlein, the chair of the newly formed Coalition for Adult Beverage Alternatives and the president of the Cannabis Beverage Association. But first let me check in with my co-host, Anne Rae how's your week going?
AnnaRae Grabstein:It's been a good one. I have been really enjoying lots of conversations I've been having, I'm doing a lot of planning for 2025. And overall, just feeling inspired. We hit a milestone with the podcast this week Woohoo and you and I spent some time yesterday thinking about what do we want this all to be, what are we really trying to create here? And thinking a lot about the community, that that is, our listeners and how we create um mutual success, like personally, professionally and for businesses and cannabis, and and I hope that uh, that our content is continuing um to inspire people to be better, to think more, and that we'll and we'll keep trying to think about creative ways to engage everybody. So I'm having fun.
Ben Larson:It's funny. I was talking to the team and they're like well, you know, we're becoming more sophisticated now and it's nice to like track things. Even if it's just validating your gut feeling. It's better to go to the board and say here's why we're doing it, not just I feel this is the right thing to do just I feel this is the right thing to do.
AnnaRae Grabstein:Yeah, totally. I mean attribution and like ROI with content and with marketing is really hard. I think that there has to be this level of surrender of just putting it out there in the world and seeing what happens, and that's what we've been doing, but we also want to make sure that we're doing things that matter to people.
Ben Larson:Yeah, well, I think if this industry makes you do anything, it's surrender.
AnnaRae Grabstein:Yeah, and I love to talk about getting out of denial because I think there tends to be a lot of denial in the marijuana, cannabis, hemp world. So, yes, we're trying to bring people out of denial into a place of surrender and we'll see what happens here. How are you doing what's going on in your world?
Ben Larson:Can I just do like a dad thing and just annoy everyone that's watching, because we're all thousand people?
AnnaRae Grabstein:Yes, but keep it short.
Ben Larson:Okay, keep it short. This is me and my daughter this morning riding our bike to school, and this was precipitated because my wife is being forced into back to whatever they call it back to office, and that was very scary for me because ruining my morning routine and me having to do daddy drop offs three days a week now. But we did three days in a row of riding our bikes to school and I've been super happy this week, not that I'm not usually happy, but yeah, I feel like it's been really good for my psyche to kind of like have that be the start of the day and this little trailer thing like highly recommended, she's not quite to bike riding age yet, or she hasn't gotten off the training wheels and she's just loving it and like like we're going pretty fast, like sometimes we get up like 20 miles per hour. I don't know if that's safe, but she's like faster, faster, faster, and so it's like getting that fear thing. She's pedaling and so I think it's going to really help.
AnnaRae Grabstein:So yeah, that's awesome. Your morning workout routine is indoors usually right so I'm still doing that.
Ben Larson:So I get up up at five, I go to the gym, I get that all done Sometimes it's outdoors, there's like swimming sometimes and then I get home, get the kids out of bed and usually it was like all right, kind of like get ready for office work. Now I get to do this three days a week and still make it here in time for this.
AnnaRae Grabstein:Well, I love to hear stories about dads and moms and everybody showing up for their family while still being badass entrepreneurs and leaders. So I hope nobody is too offended at our sharing of personal stories, but we should all. We all have to have balance in our life in order to be showing up for these.
Ben Larson:Yes, that's the moral.
AnnaRae Grabstein:Yeah, there you go. That's the moral.
Diana Eberlein:I know.
AnnaRae Grabstein:So we've got a lot to talk about today. I think to just go for it. What do you think Are?
Ben Larson:we ready, absolutely. I get stoked anytime we get to talk about the topic that we're going to be talking about today.
AnnaRae Grabstein:This is a beverage episode. For anyone that was wondering, we are going to be talking about beverage. Well, I'll keep up. Diana. Our guest today is Diana Everline and she really is a pivotal figure in the cannabis beverage space. Today she's the chair of CABA, the Coalition for Adult Beverage Alternatives. She's also the president of the Cannabis Beverage Association and she runs business development and marketing at Source. Her leadership is definitely unquestionably propelling the beverage segment forward, focusing on expanding consumer access and education and legislative progress, and we are really excited to have her here today to officially launch this new coalition. So that's what we're going to be talking about today. Welcome, Diana. Thank you, guys for having me.
Diana Eberlein:I'm excited to be here.
Ben Larson:Awesome to have you on the show. Where in the world are you today, Diana? It's like tracking Elon Musk.
Diana Eberlein:I'm in Longboat Key, Florida. I'm here for the National Association of Food Systems and Flavors show.
Ben Larson:We were texting earlier and you were in Tennessee.
Diana Eberlein:I got into Florida last night. I left the Tennessee Wine and Spirits Retailer Association event yesterday. I'll talk in cannabis beverage, so it's exciting. It's my favorite topic too.
Ben Larson:You've literally become the Johnny Apple seat of cannabis beverage.
AnnaRae Grabstein:And before we got on, you were sharing with me that you also have moved to Washington DC to be closer to the center of policy, which is also huge.
Diana Eberlein:I'm about three blocks from my lobbyist, which they'll either love or hate in the next few months. We'll find out, and I can walk to the Hill if I need to, even in my heels.
AnnaRae Grabstein:Incredible. Well, so tell us. You recently launched the Coalition for Adult Beverage Alternatives, and I want to know what inspired the formation of this coalition and what are the goals. What are we doing here?
Diana Eberlein:I think we have the Mary Miller Amendment to thank for CABA Essentially. You know, I think back in May when Mary Miller Amendment hit trying to amend the farm bill to essentially extinguish the hemp industry as we know it right now, there was a lot of panic. I think a lot of people felt like that was a gut punch and, ironically, there was a huge silver lining that came from that and that was that alcohol wanted to get involved and figure out how to support and be more active in us moving this category forward. Because the reality is consumer trends and consumer behavior is showing that this is a beverage in demand. This is a category in demand when it's made accessible to the right consumer at the right dosage. It is something in demand that shows a lot of movement. And so, with the Mary Miller Amendment and that threat to this category going away as well as the rest of hemp as we know it, it got a lot of larger players involved. Rest of hemp as we know it, it got a lot of larger players involved.
Diana Eberlein:The reason that Kaba came to be and not just joining another association or another coalition alcohol really wants to work alongside what they know best, which is beverage. That's what they know. They're not familiar with flour, they're not familiar with gummy. That's not their expertise. As a result, they really wanted something targeted and focused on something that was going to impact their industry directly, and I think what we've seen a lot of over the last couple of years. There's a lot of associations out there and a lot of them represent a lot of different components of the plant. It made it very difficult for groups to advocate for their particular needs and wants when they're also part of an association that represents something that might feel differently on that stance or represent a different category entirely. So, as a result, we're we're a little bit more, we're more focused, but, at the end of the day, what we're looking to achieve by keeping hemp open in the Farmville, it helps the whole industry, it helps and it helps cannabis as well, not just hemp.
Ben Larson:We were all three at the hemp beverage conference in Minneapolis earlier this year and we held a brunch the morning after and had about 20, 25 people in there and one of those people is Norman Bierenbaum from the FDA. And there's just this one moment that just kept repeating itself in my head uh, after after that week, and it was uh, who are you standing next to? Um, it just became very, uh, very clear as to when we're talking to policymakers, regulators, legislators, they really are considering and judging you based on who you're associating with, and everything's become so volatile and loaded from a cannabis and or hemp perspective that it's really interesting to watch how the conversations change when you're standing next to alcohol partners.
Diana Eberlein:It's really interesting to watch how the conversations change. When you're standing next to alcohol partners, it's opened up a lot of doors. Even just in a conversation, beverage isn't the first thing that comes to mind. They're learning about us to a degree for the very first time and having us approach them with a plan which I know we'll dive into a little bit more. But alongside alcohol changes how we're received in that conversation and frankly I think is a good reflection on the rest of the hemp and cannabis community.
AnnaRae Grabstein:It's interesting You're speaking to this focused niche and it speaks to an evolution in the space really, because if we go back 10 years or even five years, there was a lot of commitment from a lobbying and policy perspective of trying to bring everyone together and work together, and now you're starting to see whether it's beverage coalitions like what you're working on, or focused distribution groups or focused manufacturing groups that people really do have different, very specific policy needs in order for their business to be able to flourish and move forward and by focusing you're able to actually have a very specific message and an action to be able to flourish and move forward. And by focusing you're able to actually have a very specific message and an action to be pushing. So I think it makes sense. I see why you're doing it. I am curious to hear both of you are talking about standing next to alcohol and how almost it seems like well-loved alcohol is in DC, or that they have this access point.
Ben Larson:People love money.
AnnaRae Grabstein:And I want to know what that is. Is it just because people have been drinking for so long and everybody does it there isn't a stigma around it or is it money? What is driving this, coming together with alcohol?
Diana Eberlein:I mean, I would really say what's driving us coming together with alcohol is consumer behavior. You know I've said this recently. You know stress hasn't diminished over the last few years. Partying hasn't stopped, but what the consumer's grabbing for at the end of the day from their fridge has changed. Non-alcoholic has been growing years and I think consumers are looking for something different. I also think that COVID has people looking at their health and wellness a little bit differently. They're more aware now of what they're putting in their bodies than they have been for years.
Diana Eberlein:And let's face it, alcohol is not going away. I still love my wine. I think that's a very important thing that we need to kind of get out there. This is not neither or, and actually what was said at the Tennessee Wine and Spirit Show recently was someone said we look at this as a compliment. This is just another option.
Diana Eberlein:But the environment dictates the beverage and similarities to alcohol, how we want to be distributed, who our target audience is the experience. The experience when you have a beverage is very different than if you were smoking cannabis, so they're not necessarily talking to the same consumer. So I think that's what's driving a lot of the relationship. Um, but to Ben's point. Uh, everyone loves money and there's a lot of influence that comes along with that um on the Hill Hill, but they also have a lot of experience on the Hill. They are consistently lobbying for things. Even though we're in our echo chamber, where we only hear about our issues and what we're fighting for, there's all sorts of regulations that they're lobbying for, so they're just a regular face as well. So us being introduced into this conversation through them makes it a much smoother transition.
Ben Larson:Yeah, and what I've often talked about is kind of the push and pull nature of like progress when it comes to legalization, and for a long time the hemp and cannabis industry have like really been pushing to for acceptance and and to and for relevance Right, and a few months back it was just this. This thought was like what if it was more of a pull? Like what if we had something from the outside pulling what they wanted from the cannabis and hemp industry into into the mainstream channels? And so it's like can we have alcohol actually identifying what it is that they want on their shelves and then working with us to kind of create that pathway to pull it into the mainstream?
Diana Eberlein:That's a great way of looking at it and you know I keep mentioning Tennessee because it's fresh in my mind but also it was such a. I get so much motivation coming from those events where the alcohol partners are, because they're not just curious about how they can get involved or trying to learn about the category, they're now investing in it. They are putting dollars and resources towards promoting and supporting this category. They're excited about it and you know people who've been in beverage for as long as Ben and I have know that people weren't always as excited about beverage. That 0.3% of the market share that low-dose beverage had in particular was not necessarily getting me a lot of attention of others. So it's really wonderful to see them embracing us and eager to talk to us about what we're looking for and what we think would be the right way to regulate this category moving forward. And I think the more we talk we realize, the more alignment there is.
AnnaRae Grabstein:Well, so let's talk about the alignment Leading up to this. You guys shared with me the code of conduct that has been put together for the coalition and it really lays it out there, and I think that, as part of this launch, it would be great to have you just break it down. Diana, what are you? What are you going after here?
Diana Eberlein:We're one of our. The biggest differences between what we've been advocating for and I think, what we've heard traditionally is we are not making this about hemp or cannabis. This is really a dosage conversation. When it comes to THC, we believe that low-dose beverage should be sold where there are consumers looking for them, which is alongside alcohol, anywhere alcohol is sold and served. But we're defining low-dose and we are talking about how we believe to best regulate this space, and the number one thing we hear is we don't want these products getting in the hands of children. So what we're focused on is using the infrastructure that's already been built, that's been very successful at that, and that's the one that TTB has put in place for alcohol.
Diana Eberlein:So we are mimicking a little bit of what TTB is asking for. You know, we want 21 and over age gating. We want these products to be alongside alcohol, so it's obvious that this is in an adult beverage location. We want standardized packaging. We want it to be very clear what the dosage is on the front of the can, as well as the fact that it's THC, versus just writing hemp on the front, which I think can be very confusing for consumers. We want full panel testing and purity testing and, again, defining low dose. So what we define low doses is up to 10 milligrams of THC per serving, 100 milligrams per package, which allows for four packs, six packs, but also multi-serving spirits like products on the shelves as well. But the main thing that we want to make sure is very clear is you know, this isn't about just putting beverage over the line. Obviously, I only consume through beverage, so I'm obviously biased and very much, you know, in support of this category, which is why I'm so passionate about this space, why I'm so passionate about this space.
Diana Eberlein:But we really believe that by advocating and using infrastructure that already exists, getting in front of the mainstream consumer, we can change the perception of hemp as well as cannabis and make all of it more approachable for the consumer. We are still met with a stigma, no matter how normalized we might feel it is, no matter how it feels. When you go to Minnesota and you, you see, you know, you see these products sold at bars and restaurants and there it's very normalized. It's very different. In other parts of the country it's. You don't experience that.
Diana Eberlein:So we think that we can, you know, working alongside alcohol, we can get that accessibility but also still maintain the safety and quality requirements that are necessary to operate in CBG within the United States. We also look, we're trying to follow the same model tax it. We want to be in the three-tiered system. Essentially, we want to use the same distribution partners. We're not looking to reinvent the wheel. We're looking to become part of what's already been very effective in not only getting distribution and access to these products, but again keeping these out of the hands of miners.
Ben Larson:Diana, actually I don't think you were able to make it to our morning mixer last year, but we did our first high spirits event at MJ Biz and we had infused beverages and it was at like 10, 10.30 in the morning and Anna Rae, I mean, you're relatively an outsider to the category, so it was pretty welcoming. Right as far as de-stigmatizing the consumption, it was just a very different appeal, but people were certainly consuming.
AnnaRae Grabstein:Oh yeah, in the morning, um, drinking THC, I mean it's it definitely created a different atmosphere. There was, there was no smoke in the air, you know. It felt very, um, very accessible. So, yeah, and we're doing it again. Well, so I want to.
AnnaRae Grabstein:I just I love, I love the approach that you're taking, Diana. It just seems so sensible. And, um, so I want to. I just I love, I love the approach that you're taking, diana. It just seems so sensible. And, like I always loved the Students for Sensible Drug Policy which is even the name of that organization, because I think sensible drug policy is is what we're all talking about here. And and what it seems like you're pushing for is for adults to be able to make clear choices with simple and easy access. And, um, I mean, I'm on board, sign me up. But what I'd like to know is like, actually, what is the hope? Is it focused on the Mary Miller Amendment and the Farm Bill? Is that the short term? But there's a more long-term play? It sounds like you are focused on Washington DC as opposed to going after. There's all these different states that are starting to different types of regulations in place for hemp. So what's the legislative and policy strategy? This?
Diana Eberlein:is a federally focused group we are advocating for. You know we want to keep hemp and the intoxicating cannabinoids like D9, you know legal through the farm bill. So the initial short-term focus is the farm bill and explaining to them why. You know we need this to be to remain open and again, that's why I believe that what we're doing, even with alcohol and focusing just on beverage, we're supporting an initiative that the rest of hemp is also looking to achieve. So I think we are, you know, while focused on specific conversations, also supporting the rest of the industry as a whole. And then, long term, we're looking to implement legislation.
Diana Eberlein:You know we are in support of the Wydenville implement legislation. You know we are in support of the Wyden bill. We look forward to working with their group in developing and kind of building out the beverage regulations within that. I think the best thing about that bill existing is the fact that it exists. It starts the conversation about this becoming a possibility and you know we are happy to, you know, represent the beverage category and create the legislation that can be a plug and play for the TTB in the future. So that's really what we're looking to do. I mean short term it's Farm Bill focus on the states being able to continue regulating this category as they as they have been and there are some states that have done a great job at that and I think, the more education we do, the states can effectively regulate their markets, just like they do for alcohol.
Ben Larson:The states can effectively regulate their markets, just like they do for alcohol. Just really quick for our audience, dtc is direct to consumer, so a complicated conversation. When it comes to alcohol and the three-tiered system, before we kind of jump into that relationship with alcohol, I just want to highlight how awesome it is that the Wyden bill actually had a beverage clause in it. Like it's such an awesome opportunity for people to just realize that there is a beverage category and that is like there's this consideration of treating it differently, because our early days in DC, early days like three years ago, talking with various senators and around the country, not even knowing the difference between THC and CBD. So creating this venue to have a conversation about the nuances of categories and how they might be able to be treated differently is incredible.
Ben Larson:But also going back to why the focus is so important, like having this, like focused effort, is, if that is your starting point, you can't expect the legislators or policymakers to know how to write these laws, and so we as an organization need to focus on writing exactly what it is that we're asking for, because if someone asks us, well, what do you want, it's like boom, here's the book, just implement this, please. And it gives them a starting place, and this is how all of cannabis really needs to be thinking. And this is, unfortunately, how we often end up with like 350 pages of legislation when it comes to legalizing cannabis, because that's how complicated it is. So we're just focusing on that one little piece, but it's really exciting to see the Wyden bill have that piece for us to chew on.
AnnaRae Grabstein:What the Wyden bill represents is standalone legislation and the farm bill. It just expired, you know, four weeks ago or something. I think it was September 30th. So we're just. We're in this awkward place, like I realized that the farm bill is the short term focus because it will move forward at some point. There's too many other elements of the farm bill that have nothing to do with this issue. That will make that, will ensure that it continues on in its path. But ultimately we want something that is not a temporary policy and standalone legislation represents that. But nobody has any confidence that standalone legislation is moving through both houses and getting a president's signature, so it largely is symbolic houses and getting a president's signature, so it largely is symbolic.
AnnaRae Grabstein:I've assumed that the Wyden bill represents a alternative to the Mary Miller amendment to be like all right, we could take that and stick it over here and put it in the farm bill. What are you guys hearing? You've now engaged lobbyists. That's their job is to hear things. What do you think is the next steps in the farm bill? Is it going to be the widen language? Is it something else? Have you written proposed language? Where are we going?
Diana Eberlein:Sure, and, without going too deep into specifics, I can tell you the conversations I've had on the Hill have been very positive. I've even heard that Mary Miller's office is open to making amendments to that. So I think us being prepared. As Ben said, they keep asking us to meet them in the middle. We have to show them where the middle is and I think we need to have language prepared that can help support naturally occurring cannabinoids in the farm bill, including the intoxicating D9, so that we can continue moving forward with this category and from what I'm hearing that I think there's an opportunity there because I understand the concern.
Diana Eberlein:None of us want kids to get access to intoxicating products without no one wants that. So obviously coming up with and I also think that there's a lot of people that aren't comfortable with some of the manufactured cannabinoids out there that are a thousand times stronger than, you know, d9. I think we need to make sure that we have purity testing and different things in place to be able to confirm that synthetic materials are safe. I think there's a lot of things that we can put into the farm bill that support farmers and make sense to be in the farm bill, that can still keep our category, as well as the rest of hemp, alive, just making sure we're producing safe and high quality products. So we do have language that we've prepared.
Diana Eberlein:We have not been necessarily asked to submit that yet. However, we have started those conversations on really just educating people on what we're asking for and where we think the compromise in the middle is, because I do believe there is going to have to be a compromise. If it stayed through just as it is, we would continue leading as good stewards in this space and promoting our code of conduct to make sure safe and high quality products are accessible, and that's what's being sold in the market. Bad actors pose a risk to all of us, so if regulations put in place that protects the consumer, that also protects our industry as well.
AnnaRae Grabstein:Talk about timing a little bit, because we're in a bit of a purgatory and people are really scared to put new products into market, to invest in building inventory, to get into the the category, because there is this lingering uncertainty and at this point does anybody understand how soon the farm bill is going to be back on the table, like what is happening.
Diana Eberlein:I'm hearing March 2025. I'm hearing that's when they you know, obviously, I feel like every time there's a bill that needs to be renewed or anything they're like, well, we're going to get it done by the end of the year. They're always going to try to get it done by the end of the year. But I think, realistically, all the other issues that they're tackling I mean food stamps are the number one thing they're focused on. Their SNAP program.
Ben Larson:They have a lot of work to do, I think, on that to get both sides to be happy. So I think we're going to be looking at March 2025. Can we transition a little bit to some of the alcohol talking points and how those relationships are influencing it? And so you know, to answer some of the questions that have been popping up in the chat, it's like this relationship that we've been building with alcohol does kind of give more of that influence, more of that confidence that we'll find more of a middle ground when it comes to the Miller Amendment, whenever the Farm Bill does in fact end up happening.
Ben Larson:But what is keeping alcohol happy? Right, there's this question about how do we feel about the no hangover conversation, how do we feel about the anti-alcohol rhetoric and then even the direct to consumer conversation, because I know that's been a challenge. I mean, I've seen direct to direct to consumer and alcohol, but it seems to be tricky for some reason or another. So, yeah, let's just quick fire, let's start with no, uh, no hangover. Like, how are we feeling about no hangover?
Diana Eberlein:No hangover. Um, you know, frankly, it was one of those aha moments for me when a retailer said we don't like the no hangover language because it promotes, encourages, overconsumption, it that language had never hit my ear that way, um. But I do think they have a point and I think the point is sometimes, by saying no hangover, it implies you can have as much of this as you want, and that's not necessarily the case. I can tell you, as someone who consumes THC, to calm down, generally, if I have more than I'm supposed to, I have the opposite experience and I do think we have to be honest about the risks that are involved with consuming THC. As much as it might be a healthy alternative to lots of other things, there are still undesirable experiences that a consumer can have if they think that they can have as much of this as they want. So I do think that we need to come up with language that is a little bit more clear or at least be more transparent about. Hey, like you do want to understand what your tolerance is, because you want to enjoy the experience, you don't want to overdo it.
Diana Eberlein:I know my tolerance is 10 milligrams. I'm still a low dose consumer. Two milligram increments. That's my sweet spot. If someone handed me a 50 milligram drink and I didn't know that you would be watching me finding my happy place in the corner, it wouldn't be a positive experience. And while I'm willing and experienced in this category to understand how to find my sweet spot, we have to do this just like we did with alcohol. You got to find your tolerance. You got to find what works for you and maybe cannabis isn't for you, and that's okay, just like some alcohol isn't isn't for everybody either.
Diana Eberlein:So, and again, not neither or, um, I think it's about people figuring it out, um, but I do think it makes sense.
Diana Eberlein:From a retailer perspective, particularly these mom and pop, uh liquor stores like in Tennessee, you can't have a chain. You can have a couple of retail locations. They're very hands-on with their community. They know the people coming into their store and buying their products. They want to make sure the consumer the person they know that lives in their neighborhood is safe and that they are promoting a product that's going to provide a desirable experience, but also that that consumer knows what they've just bought. And I think that's part of why some of them are steering away from the no hangover conversation, so I do think it's something we need to consider. I think you know I've heard stories of people over consuming and being high for a much longer duration than we typically, you know, market for, and that's because it was way more than their tolerance Makes sense If you have way more alcohol than you normally have you're going to feel drunker longer way more alcohol than you normally have.
Diana Eberlein:You're going to feel drunker longer. So you know, these are things that I do think as the consumer becomes more educated, they'll be able to navigate themselves. But because we're so new, we're such a fragile industry. You know, we have been not only fighting to keep this category open through the farm bill, but we're actually fighting against time before a really bad accident happens, where someone has consumed something not necessarily a beverage, just something intoxicating without knowing and creating a situation where people panic because there's been an accident. I think, as a result, we need to be very careful with our education and the information we put out there. And I'm not going to say we're saying you can't use that verbiage, but I do think we as a category and brands should be considering this in their materials, how are they also educating on how their product experience is going to be? If they're going to say no hangover, what is the verbiage that's supporting that in terms of the experience they're trying to deliver with their product, and does their dosage reflect that?
AnnaRae Grabstein:It's really interesting that you're talking about education, because it's a short jump to marketing. It's like how are we talking about our products and I know we're going to talk about DTC next and marketing plays a critical piece in direct-to-consumer sales of beverages and I'm wondering, with the structure using the TTB as the regulatory authority here, will there automatically or might there automatically be shifts to advertising and marketing in a similar way that we don't see Smyrna vodka selling in Instagram stories? Will that be the case for?
Diana Eberlein:THC beverages and we are not advocating against direct-to-consumer right now. Without mainstream access to the bigger distributors, we kind of need direct-to-consumer to survive as a category and I think a lot of the alcohol partners understand that. I think the retailers understand that. From a regulatory standpoint, what is concerning to federal agencies is the fact that that makes it very hard for the states to actually regulate what's coming into their market and, as a result, direct-to-consumer in the future might be something we have to somewhat compromise on and that might be similar to what you see with wine. I still get wine from Washington state shipped to me in DC at the age gaining that's required for that the sign on delivery. That's very expensive. We are shipping liquids. They are expensive.
Diana Eberlein:This is not something in the longterm. Direct to consumer should not be something in the longterm that we are 100% dedicated to, because if we could get access to all the total wines in the world and all the liquor stores and be in the alcohol section in grocery stores working with ABC, we're going to get the accessibility we need and consumers prefer that to direct-to-consumer because everyone hates those shipping fees. But I think that will be something that shifts. What I could see us seeing in the future is brands that are of a certain size might qualify for direct to consumer, but they again have to qualify and do the sign on delivery. You have to confirm your 21 at receipt, that sort of thing.
Diana Eberlein:Because I think that right now is what's missing across the board in hemp on the hemp THC side is really doing the full age gating there. When it comes to direct to consumer, I think it's like $20 a shipment to really do it right. I mean that's an expensive light item. So if you were shipping beverage, which is already heavy and God forbid, someone pays for expedited shipping, it's you know you're paying the same in shipping as you are for the product and I don't think the consumer at the end of the day is going to continue wanting to do that if they have the ability to get it at the local liquor store at the end of the day, is going to continue wanting to do that if they have the ability to get it at the local liquor store.
AnnaRae Grabstein:What about the marketing though? The Instagram stories, the billboards, the you know, things like that?
Diana Eberlein:I think that that can continue to to a degree. I mean, we definitely see alcohol advertising, you know, to some degree on billboards and different stuff. I think that will continue. I think you know, right now we're building up our consumer base and our target audience. I do think there will be more stringent regulation, probably put around that. I think there's been a lot of workarounds developed, but I don't think that that will change. I get advertisements all the time for things I mean granted my phone's listening to me, so I get a lot of THC beverage ads, but I also get a lot of beverage ads in general. So you know, we get what we're talking about and what we're focused on and I think that we'll continue. But I do think that we need to look at what alcohol is doing from a marketing standpoint and be prepared to mirror that.
Ben Larson:So you're talking about the ads and marketing and I do want to kind of talk about the relationship between cannabis beverages and and alcohol. There's a lot of or there's some very notable low-dose products that have kind of almost marketed this adversarial relationship between the two and as someone that's been in the industry for some time, I understand we're kind of constantly in this position of having to be deemed a schedule one substance when the deaths associated with cannabis compared to alcohol are so drastically different. Like why are we being treated like plutonium? So I understand where it's rooted from, but as we mature and as we get into these mainstream marketplaces, can you talk a little bit about the dynamic between how we're marketing cannabis in relation to alcohol? Is it you know, because I there's been some sensitivity to like, oh, alcohol, you've met your match.
Diana Eberlein:Yes.
Ben Larson:You know, similar to you, I'm also a fan of being, you know, of the crossfades. I don't think they have to be enemies.
Diana Eberlein:Yeah, absolutely, and I, I do. I have heard brands also getting backlash for advertising against uh you know, or using alcohol, putting alcohol down in their advertising distributors, saying we're not going to pick you up because our brands, we still are moving a lot of alcohol and our brands don't support what you're advocating for. So, as a result, they still a majority of their revenue is still coming from alcohol and so they're not going to damage that relationship. For one brand that might be saying one thing or another, so I do think we need to be careful about that. It's definitely something that's come up with at events like the State Liquor Administrator event that I spoke at recently.
Diana Eberlein:It comes up a lot. They like to see us working hand in hand with alcohol and they would like to see the other beverage categories supporting each other, not putting them down, and I think we have plenty of things that our beverage, our category, can market and advertise on that doesn't have to put down alcohol per se. And I also think you know, look, the consumer knows a lot about alcohol. We've been consuming alcohol for a very long time. As a result, you're not going to tell them anything they don't already know. So there's ways to communicate value adds of your brand and your product that doesn't explicitly call out another category. That again you're trying to play in the same sandbox with.
Ben Larson:Yeah, makes sense.
AnnaRae Grabstein:I'd like to talk about what you're hoping to accomplish with the membership base of the coalition, and we did get a message from somebody that's asking about specifically who are the alcohol members and how are they using their influence. But I'd like it if you could just address in general kind of who you're hoping to attract into this coalition, what it's going to look like to participate and and let people know how and if, if you want to, yeah, absolutely.
Diana Eberlein:Our membership tiers will vary. You know, obviously we have we hired a top 10 lobbyists that also works with the Wine and Spares Wholesaler Association and Sazerac Lobbyists, as you guys know. I mean Ben said it. You know the hill loves money. They are not cheap, so we will be looking for members to come on board and help support our initiative. There'll be also be free membership as well. So what I mean by free membership is we will be asking people who take a look at our sort of code of conduct if they don't have resources that they can donate to the members or to the coalition. We still want to show that there's support for what we're advocating for and we want people to feel included, because this isn't meant to exclude anybody. If you're in support of the low dose beverage category and what we're advocating for and our code of conduct and all of that, we want to be able to show that and we want to put you guys on display. So we do have a free membership that basically has that brand signing off on the code of conduct and what we are advocating for on the hill. And then we'll have other membership tiers that vary from $1,500 up to $10,000 a month and that'll be based on what your self-reported revenue is. So what we're doing there is trying to mimic what you're seeing in alcohol, as well as food and beverage.
Diana Eberlein:On the association front in terms of membership, obviously we are looking to grow and have as much support as possible. We are looking for groups in alcohol as well as hemp and marijuana. We are not again. We're more about the dosage conversation than whether it's hemp or marijuana derived. This, to us, is a very different conversation. So we are working with groups like Tilray and Keef Cola, who operate in both. We on the alcohol side have ABC Florida on the board, we have Spex. We also have Eagle Rock Distributing, who is really big out of Georgia and Colorado, and a lot of those groups are big players with the National Beer Wholesaler Association as well as the Wine and Spears Wholesaler Association. So we're really looking for alignment with those different groups as well, and bringing those members on to show that we have shared interest is important to us. We have had conversations with lots of other alcohol partners that I think will be more vocal in the future.
Diana Eberlein:I think it's just a matter of formalizing everything and getting it out there, but we are really excited and I will tell you, since we've launched, we've gotten a ton of interest and a lot of support about what we're trying to do in terms of educating on the category. And one thing know, one thing I will say I think there's been a lot of education on the Hill. There's definitely been a lot of conversations, but because there's been so many different messages, I think there's still a need for continued education, but particularly for our category. Our category is very rarely the one that's been highlighted in the past when they're talking about hemp or cannabis. So, as a result, I mean I can tell you some of the conversations I've had. They're like oh, I didn't know that was a thing. And it reminds us back to when we were talking about this five, six years ago and people didn't know in a dispensary that beverages even existed. So it's very reminiscent of that and I understand it, because it's not necessarily in their backyard the same way it is if you're in Minnesota or if you're on our LinkedIn echo chamber. So it's something that people are excited to hear about too, because it's also something familiar to them.
Diana Eberlein:Regulators, legislators, staffers, they're all humans when they learn about something that's very similar to something they consume on a regular basis and, let's face it, the consumer is very familiar with getting adaptogens as well as intoxicating ingredients from beverages.
Diana Eberlein:This is very familiar. This is something they're interested in, not just from a professional standpoint, because this is how we're approaching them, but also personally. There's a lot of interest in understanding what this product is, how it can be incorporated into their lives and, frankly, as anyone can imagine how it can be, you know, incorporated into their lives and, frankly, as anyone can imagine how it can help their friends and family, how it might be something that you know their friends and family might be able to enjoy. I mean, I think you know anyone who works in cannabis knows that Thanksgiving and Christmas seem to be times when these categories spike, because you're going to spend a lot of time with family. I think there's a lot of you know, as the holidays approach and this election approaches, people are looking for ways to calm down. This is one of them. So I think you know there's a lot of personal interests, not just professional, and that's where the enthusiasm on the Hill comes from.
Ben Larson:One of the little nuggets of insight from doing work on the Hill is that a lot of the conversations and a lot of the power is with the staffers, and a lot of the staffers are in that kind of Gen Z, millennial age group, and so it's like, as they are shifting and learning about new products to consume, like they're pretty easy to convince and so you just give them all the talking points and then they get excited to go and educate their bosses, and so you're, you're kind of creating this network effect as you're having these, these conversations.
Ben Larson:So, um, you know, we, we and those of us that look at politics and are not always happy with what we're seeing, you know, oftentimes, I know, like watching people to age out and just like, oh man, if we could just get the new generation in, and it's.
Ben Larson:You know, what I've realized over the last few years is like the new generation is there. They're just kind of like sitting behind a lot of the legislators, and so we're getting there, lot of the legislators, and so, um, we're getting there and and this, this category, creates a lot of this a lot of head nodding, right, whereas when you talk about cannabis and broadly, and you're trying to like talk about legalization broadly, you get a lot of confused looks and it's just a lot of like I don't, I don't know like what you're trying to get me to do or say, and it's like, oh, just support this bill when it comes across your desk, but this is a category that people are actually engaging with and be like oh yeah, like how do we make this work? And you know, credit to diana for for really kind of putting in the legwork to try to figure out how to, how to actually indeed make it work.
Diana Eberlein:I mean I will say I mean, if I had been a regulator when cannabis and then you know, hemp entered the chat with the farm bill and the whole bit and they said you're going to regulate cannabis. Cannabis is 10 plus ways of consumption, methods of consumption, over a hundred cannabinoids I would have been like cool, I'm retiring, like it's. 100 cannabinoids. I would have been like cool, I'm retiring, like it's. It's a huge beast and it's hard to understand.
Diana Eberlein:It's not as as straightforward as alcohol is in many ways. If they had told someone you're going to regulate cannabis beverage, only then you can really deep dive and really understand each category. But that wasn't how it was done. So it is very difficult for them to put together regulation that covers all of the different categories and then you have a plant that's more complicated and complex than they're used to having to regulate as well, and, again, many use cases. So there's just a lot of knowledge and it is confusing. I mean, when I was new to cannabis because I was a dare baby that signed that agreement saying I would never consume drugs, so I'm sure they're coming for me, did we?
Ben Larson:sign something.
Diana Eberlein:You know what I think I might have. I joke, I laugh every time I see someone saying like I signed a contract, that they're coming for me. For I'm like, oh, I think that's me. But I think about the fact that when I tried to enter the space, I was very overwhelmed. I was overwhelmed by the options. I didn't know the difference between two, five, 10 and a hundred milligrams. I didn't understand the experience difference between beverage and traditional edible, like a gummy. I didn't understand any of that.
Diana Eberlein:And you really have to deep dive in and these regulators don't just have one thing to regulate. They've got a bunch of things to regulate and it's a lot. And that's as a result when they say, meet us in the middle, we need to help them get to the middle. We need to do the education as well as provide the solutions that protect the consumer but also protect our industry, and I think that's the other thing that we need to make sure we're always. We are selling something that someone will ingest. This is CPG at its most important. You are selling something that is also impairing. We need to make sure that when we move forward and do the education, that we are being transparent and earning the trust of these regulators, and that means putting the consumer first.
AnnaRae Grabstein:You talked a little bit about your evolution, of when you came into the space to where you are now, and something that Ben and I like to talk about pretty consistently with everybody is leadership, and I would love to just hear your reflection on that evolution. I know you came into the space to do business development and marketing, and where you are now is really focused on coalition building and policy, and I would love to hear your reflection on how you approach leadership and what advice you would give to folks that are newer to the space than you.
Diana Eberlein:Yeah, absolutely, and I never thought I'd be in this position. But ironically one of my friends said recently that it kind of seemed natural because seven years ago when I discovered beverage and I started bringing it around my friends before we would go out or we would be hanging at a barbecue they were like they had never been exposed to beverage, they had never seen it before. But they were consuming cannabis in many different ways and been going to dispensaries for years because I had moved to Seattle after it was legalized. My friends in Seattle were already consuming and that was kind of why I felt like I needed to explore and understand it better. And they made a comment to me and that's why I got into the space and it was I would buy this from you, but no one would ever recommend this to me at a dispensary. And it was a low dose drink mix at the time and no one walked into a dispensary saying, hey, do you have any drink mixes? Like that just wasn't a thing. It basically still isn't a thing. But that I was already marketing. It was a word of mouth marketing it was. It was that why we were saying ROI is so hard in marketing, because sometimes you can have an impact and it's, you know, something you can't track. And they were like you you should get into this space.
Diana Eberlein:And two years later, I did Um, and because beverage is the only way I consume, it was the only way I could, you know, understand my tolerance and really control it. Um, I I felt really safe and excited to try this space. Now, what I would say, I think if you're going to work in cannabis, I always say you need cannabis to work in cannabis, because it's crazy, but you need passion. Um, and I wouldn't be able to do what I'm doing now without the brands and support that I've gotten from not only my company but everyone in this category. It's an honor to represent the brands and the groups that are in this category, because I think beverage is such a difficult market. It's expensive and I think honestly.
Diana Eberlein:I think for me, what's been most beneficial is reminding myself that this isn't about me. The leadership part is you're helping lead the rest of these categories and this category to develop a really great product and get it out to the consumer. And have gone through regulation changes in every state and have 15 different labels I mean it is hard. And then you have to fundraise and then, if you were in the regulated market, you were in 15 different states with 15 different co-packers. When you see people doing that, it becomes personal, and I think the reason that I care so much is because of the people I've worked with.
Diana Eberlein:I love the products, no doubt about it, but I think the people are what's really the fire behind this, if you will. So for me it's about not forgetting who you're working with and why, because it's much bigger than just getting the product out there at the end of the day, and I do think, ultimately, we are not only am I proud to represent the people that have put so much faith in me, but the consumers we're going to impact with these products. That's the other component to it. Keeping that at the forefront and not getting lost in the roller coaster that is this category is really important.
Ben Larson:Yeah Well, speaking on behalf of your competitors and the entire category and industry, we're all incredibly grateful for your leadership. You know there's a lot of people with great ideas, lots of thoughts, me being one of them. You know it's easy to stay up late one night and write an article and put it out on LinkedIn. Stay up late one night and write an article and put it out on LinkedIn. But to actually take that and put it into action and realize it is really a huge benefit to all of us.
Ben Larson:There's a lot of people on the broader hemp category that say we're willing to be taxed, we're willing to be age gated. What you're doing with this group is saying this is how to tax us, this is how to age gate us, this is how to regulate us, and and that's exactly what the regulators are looking for and and why we're going to get this done. So just really appreciate that about the efforts. My question for you is, when we look at the groups that are representing our small category the Cannabis Beverage Association, the Hemp Beverage Alliance and now CABA like how are people to rationalize what to be a part of, where to spend their time and what do you anticipate the future looking like for the category from that perspective.
Diana Eberlein:Absolutely, and I think you know for those who aren't familiar, the difference between the Cannabis Beverage Association and the Hemp Beverage Alliance is really that the Cannabis Beverage Association also represents the regulated channel. So you're dealing with people who are, you know, in the dispensary channel. So there's different hurdles and different things that we are focused on there, as well as the hemp initiatives, the way to look at CABA and the relationship to the CBA is that the coalition is like the federal lobbying arm of fund CABA. So that's one way you can kind of get involved through that. But that way we're not stepping on each other's toes and duplicating efforts.
Diana Eberlein:With the Hemp Beverage Alliance, I mean, they have a great community, I think there's. I mean anyone who's on that Slack channel knows there's a lot of sharing going on and I think it's a great way for the community to work together and brands to collaborate. Which is one of my favorite things about this space is that you do have competitors, you know, helping each other out, and obviously there's a lot of ways through that group to focus on the state level initiatives, because they create kind of mini coalitions to tackle the things that are changing on a daily basis, it feels like, at the state level. So I think that they can all kind of work together. Obviously, the CBA has a more formal relationship with CABA, but I think that we'll continue, as we're evolving and growing in this space, to figure out how to work with each other kind of more cohesively Love it.
AnnaRae Grabstein:Wonderful. Well, we're at the end of the hour. This has been super fun to get to hear what you're doing with Kaba and also to formally launch it to the community. So, on behalf of everybody, thank you. It's time for your last call, and so this is when we turn the mic back over to you one last time to leave our audience with whatever message you would like. So, diana, what is your last call? Sure.
Diana Eberlein:So, because we're talking about Kaba today, would really love to put out a call to action for those who want to get involved, who want to support this emerging industry and category. Caba is about getting safe product accessible to the consumer and working alongside alcohol to do so. So we are looking for alcohol partners, hemp and marijuana supply chain partners and brands. We're looking for anyone who is interested in entering the space and we will be creating. We do have some educational materials that we are using on the federal level, but we are also going to be hosting some really experiential events in the future. So, you know, reach out to me to stay involved and that way you can know when we're doing these events and educational experiences. But again, we would love to have you support the association and coalition if you're in this space, because ultimately, we are all working together and this is a rising tide scenario.
Ben Larson:Amazing. And Diana, what is the best way for people to get in touch with you?
Diana Eberlein:I could list all 10 ways that people choose to get in touch with me, but I'll go with so the coalition. I have a separate email for that way I can keep those conversations really focused, and it is dianaatadultbevaltorg.
Ben Larson:I like it All right. Well, thank you very much for taking the hour out of your busy schedule to meet with us. I'm sure I'll be talking to you later today or tomorrow or whenever it is. Thank you for being a part of the show. This was really great.
Diana Eberlein:Well, thank you guys for having me Really great to have the opportunity and I'm so glad to see so many people participating and excited about the category.
Ben Larson:All right, we'll talk to you soon.
AnnaRae Grabstein:Thanks, Dana.
Ben Larson:All right, anna Rae. What do you think you ready to join the coalition? Yeah, all right, anna Rae. What do you think you ready to join the coalition?
AnnaRae Grabstein:Yeah, I think that Diana is, that the industry is very lucky to have Diana on their side and that she's going to be a great advocate for you in DC. I mean, she moved to DC. This is huge.
Ben Larson:She's like really putting her energy Dedicated, dedicated to the cause. Yeah, all right, folks, what do you think? Are you ready? Are you ready to join the coalition? Don't forget to engage with Diana, whether it's here on LinkedIn or with the email address that she gave you, thank you. Thank you again, diana, for joining us today. It was just a wealth of information and, on my favorite topic, Thank you for Diana for joining us today.
Ben Larson:It was just a wealth of information and, on my favorite topic, thank you for tuning in, watching, liking, subscribing, doing all the things every week. We did break the thousand follower mark on LinkedIn. That doesn't sound like a lot to you, maybe, but it's a lot to us and it means a lot to us. So thank you for joining us every week and continuing to grow our community. We have a great show next week. We have the president of Awana Brands. We'll kind of be diving into that, and then we have an election around the corner, so we have a little post-election. Are we calling it an after party, or hopefully an after party? I hope it's a party. We'll see. We'll see where it goes. Anyways, busy couple weeks ahead. Thanks for joining us. Until next time, folks, stay curious, stay informed and keep your spirits high. That's the show.
