71 | Alex Milligan, Nugg

“We’re all still trying to figure out where cannabis falls on the spectrum of everyone’s daily life, and how does it weave into our routine for general health and wellness, as well as to combat you know, specific things, whether it’s anxiety or depression or insomnia or what have you.”

— Alex Milligan

The team at Nugg is building out a consumer-focused cannabis company with a national footprint, even before federal legalization., 71 | Alex Milligan, Nugg NuggMD offers a quick and easy way to get a medical cannabis cards; NuggMarket partners with dispensaries for delivery; and NuggClub offers a monthly subscription of premium cannabis. Alex Milligan heads up marketing for all three, and he’s our guest.  Listen and learn why:

    • The wellness market differs from the medicinal market.
    • Startups like Nugg have an edge on bigger consumer-packaged goods companies right now.
    • Cannabis consumers in California have a different focus than those in New York.
    • Nugg hasn’t yet engaged with a celebrity spokesperson.
    • Branding is such a critical piece of the consumer-product puzzle.
    • Alex admires Amazon, but Uber not so much.

    Check out NuggClub.com

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    Want to save on state taxes by getting your medical cannabis card? Use NuggMD and save $10!

    Transcript of Podcast Episode with Alex Milligan, Nugg

    Copyright 2020 © Kannaboom

    Kannaboom 0:00

    Cannabis is booming. It's in our name — Kannaboom. And we get excited when we run into people who are on the move and really making things happen in this young industry. Today's guest Alex Milligan is someone who's doing that. As co-founder and chief marketing officer at Nugg, he is definitely moving the needle. Nugg is really three businesses in one: NuggMD, where you can get your medical marijuana card online in a few minutes. Nugg Market is an online marketplace where you can find all sorts of cannabis products, and Nugg Club is a monthly subscription box that delivers an assortment of cannabis products to your door at a really good price. So Alex and I talk about how executing on three innovative businesses across various states, each with their own specific rules and regulations can get really complex. If you enjoy business, you'll enjoy this episode because it sounds like it's been a lot of fun for Alex and his team. Whether you're a subscriber or first time listener, please stop by and see us at Kannaboom with a k.com. We are focused on how cannabinoids and CBD can help you achieve better wellness and how to find CBD that's trusted and reliable. If you like the podcast, please subscribe. And please leave a review so other people can find the show. Thanks to our producer Danny in Milwaukee. And here is my interview with Alex Milligan. Cannabis is booming, and Kannaboom is on it. Welcome to the Kannaboom podcast, where we interview experts on the changing story of humans, health and hemp. From San Diego, here's your host, Tom Stacey. Hey, it's Tom. Welcome back to the Kannaboom Podcast. Today we have Alex Milligan of Nugg. Hey, Alex, how are you doing?

    Alex Milligan 1:26

    I'm doing great, Tom how are you? Thanks for having me on.

    Kannaboom 1:28

    I'm doing good. Thanks for being here. For the listeners who don't know about Nugg, what you guys do?

    Alex Milligan 1:33

    Yeah, so we do a few different things. Nugg is a branded house of sorts, in that we've got three different business lines that we've created over the years. So in very short terms, Nugg Market is an online marketplace for cannabis delivery in California. We started that back in 2015. So very similar to like a Weedmaps. With online ordering. You know, back in 2015, the concept of moving things online and facilitating that transaction there was totally novel, but obviously since then Weedmaps, and several other major players have introduced that. So that's Nugg Market. Nugg MD we introduced in 2016. And that is a telemedicine platform that allows anyone to go online, video chat with a doctor and get approved for medical cannabis. And that operates in seven states, soon to be nine or 10. And then our most recent line of business, and certainly the one that I consider most innovative, although I mean NuggMD is up there as well, just a bit older, is Nugg Club. And that is what we consider to be the industry's first true cannabis subscription model. It is essentially a subscription box that comes every month, every other month or every quarter, that has over $225 worth of product that people pay 99 bucks for, it's totally personalized. It basically allows, you know, our customers, our members to explore the world of cannabis in a way that doesn't break the bank. So those are the three overarching lines of business Nugg MD and Nugg Club certainly being the ones where we are spending the most time and investing the most resources into.

    Kannaboom 3:27

    You have your hands full, that's a lot going on.

    Alex Milligan 3:30

    It is, it is. It's a very careful balance. But we've figured out a way to do it.

    Kannaboom 3:36

    Well, it seems that they are synergistic, and that you know, you get your medical card at NuggMD and then you're ready to go to the Market and maybe sign up for the Club.

    Unknown Speaker 3:46

    That's exactly right. I think Nug MD, you know, since 2016, has been the method by which we've bootstrapped this business, we've not taken any outside capital to this day. And NuggMD was, you know, the catalyst or the growth engine, whatever you want to call it that allowed us to reach a large potential audience, bring them in through an incredible service that granted them access to the medical cannabis market. And then ultimately, based on that trust that we've established with them, you know, we bring them into our other offerings. So you're exactly right.

    Kannaboom 4:23

    Well, and it's a nice qualifier, too, because you know, if somebody wants to get their card a) either they are a real medicinal user or b) they're cannabis enthusiasts or recreational enthusiasts.

    Alex Milligan 4:30

    That's exactly right. Exactly. Right.

    Kannaboom 4:31

    How does that manifest in your customer list? How many are more focused on the medicine or more focused on the recreational aspect?

    Alex Milligan 4:45

    Yeah, great question. So it definitely varies by state. NuggMD started in California. As you know, you know, Prop. 64 came into effect and or was voted in 2016. But you know, the fully regulated market, it kind of a little bit later. Needless to say, though, you know, since the day we started Nugg MD, California has definitely skewed more towards the general, like health and wellness, as opposed to this is like a strict medical user who is addressing, you know, a chronic ailment or condition, granted, just by the sheer volume of patients that we do see, in California, there's still you know, a significant percentage, I'd say it's, you know, around 20% 20, to 25%, that are aiming to treat a, you know, severe condition. And the rest are probably more those, hey, like, I, I definitely use it for health and wellness purposes, whether that's to treat insomnia, anxiety, what have you. But I don't necessarily have a long-term chronic condition that cannabis is the only or the best option as a treatment modality for me. Whereas in other states outside of California, like New York is totally different. Whereas in California, our average, our average customer is I believe, it's like 29, or 30 years old. In New York, it's 56 years old as the average customer. And those folks are absolutely, predominantly using cannabis as a primary treatment method for whatever ails them. So definitely varies state by state. And it's been really interesting to see, you know, how states kind of shift over time and how the demographics, you know, kind of change as people become more aware and more open to the idea that medical cannabis is something that they might want to experiment with.

    Kannaboom 6:43

    That's a really interesting distinction in that the wellness market itself is a little different than straight up medicine.

    Alex Milligan 6:53

    Yes, yes. There is a distinction there. There's a lot of blurred lines. I think, I think in general, you know, we're all still trying to figure out where cannabis falls on the spectrum of everyone's daily life, and how does it weave into our routine for general health and wellness, as well as to combat you know, specific things, whether it's anxiety or depression or insomnia or what have you. I think that's still being tinkered with. And I don't think the science is necessarily out on how effective cannabis will ultimately be as compared to other pharmaceuticals or options for severe conditions. But there's yeah, there's a distinction, there's also a lot of overlap. And I do see people moving from one to the other or using it for both, you know, a lot of people simply do find that cannabis is effective for improving their life in a wide variety of ways. So I think that's what's really, you know, interesting and special to see about this plant is just the versatility that it has, and the broad range of efficacy that that, you know, it's able to offer people in their lives.

    Kannaboom 8:13

    This is my 70th episode. And some of the earlier episodes I did with cannabis activists, like Keith Stroupof NORML, you know, in the early days back in the 70s 80s, they were making the argument that this was about personal freedom. And they never really did get traction with that. It was only when, you know, out of the San Francisco scene where people were using cannabis with AIDS patients and helping them get past nausea. And in some of the conditions that they had, that the public really began to go, 'Oh, this is a legitimate medicine.' And that was really I think the lynchpin for a lot of the legalization effort, at least in California. So it's interesting that now we're at a point where it's not straight up hardcore medicine, but it's more of a wellness factor.

    Alex Milligan 8:56

    Yeah, it's interesting to see and, and I definitely think, going into the future, we're gonna see stratification a little bit, you know, there's, I think there's always going to be that overlap. But again, as people, as we learn more about the plant, as science tells us one thing or another, and as people become familiar with cannabis and what it can do for them personally, I think we are going to see it fall into several different buckets, which is, it's optimal, frankly.

    Kannaboom 9:26

    Well, and it's interesting to me, too, that you see a difference in between California in New York, are there cultural differences or demographic differences, or the age difference in those two markets is an interesting piece of intel.

    Alex Milligan 9:39

    Yeah, cultural, societal, there's definitely a regulatory component that comes into play here. In that, you know, in New York, there is a bit of a stricter, you know, defined list of conditions that qualify for medical cannabis. Whereas in California, you know, most people are well familiar with this by now but it is a bit more relaxed, it is pretty much up to, you know, the physician, your doctor to determine whether cannabis has a place in treating or improving your life in some way. Whereas in New York, it's much more by the book, you either have this condition or you don't, you either qualify or you don't. And so I do think that definitely plays a role. But cultural is absolutely one as well. I mean, California, simply being, you know, a haven for cannabis use for decades at this point. And it being, you know, widely recognized as like a pseudo recreational market, even going back 20 years with, you know, Prop 215 versus New York, which has been a much more underground, kind of clandestine recreational market. Now being, you know, legitimized via medical, and so I think, just naturally the demographics of people, you know, becoming interested in cannabis in New York, falls more towards the medical side of things and more towards, you know, just an older demographic, given the conditions that actually allow for someone to access the medical market there.

    Kannaboom 11:17

    From a business standpoint, it would seem like this complexified your brand outreach considerably? I would think, at some point, we're all anticipating a federal legalization that I don't know if it's going to totally flatten out the field. But do you have to have sort of 50 different marketing plans when the whole nation is such a patchwork?

    Alex Milligan 11:37

    It depends on which business you're talking about? If you're talking about NuggMD, I guess for both businesses, the short answer is kind of there are components that can easily be transferred across various markets. And then there are components that can be using NuggMD as an easy example here. When it comes to different, you know, regulatory structures across the states, we have to adapt our product to be able to accommodate that. So in certain states, for instance, take California and New York again, as examples, right. In California, the doctor can conduct the evaluation online, issue the prescription themselves, or the recommendation, as they call it here and send that physical lettered recommendation to directly to the patient with no other involvement necessary. Whereas in New York, the doctor does the online approval, but then the patient and the doctor both have to go through the state's Department of Health registry to take additional action on the back end. And then the Department of Health is then actually issuing the patient a state card, which they receive from the state in the mail. So that's an easy example of just how regulatory structures define our product experience. And so we do need to adjust that state by state. But if we're looking at things, for instance, from a marketing perspective, aside from like, key demographic differences, which definitely requires some level of personalization you know, the marketing channels that have been effective for us have held strong across pretty much every market, we've gone into those main channels really being SEO, so organic search, and, you know, producing content and and information and education that draws people in at the top of the funnel gets them interested in medical cannabis and allows them to understand how it might be effective for them and ultimately converts them, as well as affiliate marketing, which our primary method of affiliates has been simply partnering with the dispensaries on the ground in those states who obviously have potential cannabis users or medical cannabis users coming into their storefronts, expressing interest, but not yet having that medical card. So we build a relationship with them whereby those dispensaries refer these prospective patients to us, they get verified online, and then they're able to go back into that dispensary and become a paying customer. So those two channels have worked really well across the board. But as more states come online, as you mentioned, federal, you know, decriminalization or ultimately legalization happens and more acquisition channels and marketing channels just simply become available to us. I think there is going to be an increasing need to personalize our efforts according to the market that we're targeting.

    Kannaboom 14:41

    I know even with packaging, there are different rules in different states and that's got to be quite a hurdle. I can see where the dispensary would like to be able to extend to their customers the ability to get the card, but are they worried about losing that customer once the customer discovers that you have the market and the box?

    Alex Milligan 15:00

    So it does depend on the state. In New York, for instance. So we only offer the box right now in California. And actually, right now, it's only in Southern California, although we will be expanding very shortly here. So New York, the dispensaries that we work with, there's absolutely, you know, no risk on their end or no apprehension because we don't have a separate market offer marketplace or box offering in that state. So we just feed those patients directly back to the dispensary. In California, obviously, we've run into this, you know, potential roadblock, with dispensaries wanting to work for us for the reason that you just described like, might we steal the customer that they ultimately refer to us, and to, you know, overcome that, we basically create a layer within our technology stack where if someone is referred by a dispensary, they actually do not ever get exposed to our marketplace or our box offerings, we promise dispensaries that hey, if you send your, your, your customers to us, they come through Nugg MD, we will send them straight back to you, and they will never hear anything from us. In regards to the Nugg marketplace, or Nugg Club. Now, obviously, there is some spillage that just cannot be avoided in the sense that, you know, we have NuggMD as a pretty prominent brand. But we've also built, you know, the Nugg Market and Nugg Club and are beginning to learn more so build the Nugg Club brands. So people recognize the Nugg name. And ultimately, you know, might experiment with one of our other offerings as well, even if we didn't directly you know, try and persuade them into trying it via our own email or, or otherwise, or other communication channels.

    Kannaboom 16:54

    That's an impressive level of customization, I must say, to be able to personalize each customer's experience based basically probably on the zip code they're in.

    Alex Milligan 17:04

    I can't even begin to describe how long it's taken to make sure that we're able to do things like that at scale, but it ultimately, you know, from the time when we were investing heavily in the marketplace, we're not going to be and even now with Nugg Club you know, we essentially have two customers, one is the dispensary The other is the end consumer and so everything about our services need to cater to both, I need to make sure that people on both, you know on all sides are satisfied and think that they're getting you know the benefit that that was a you know communicated to them up front that we would offer them so it's a it's a careful game to play but we're doing pretty well at it shuffling.

    Kannaboom 17:51

    I am a customer, I did get my card through NuggMD and I have to say it was a great experience. I don't know if I'm a typical customer, I guess. You know, I am in California, down in San Diego, and on the health and wellness side, I don't have a really chronic condition but I like edibles for sleep, and I don't like paying 35 to 40% in taxes. And I thought okay, you know, I'll get my card and it was a great painless experience online. It was really quick and friction free. And then I did see the market. And I thought that was interesting, but I like my dispensary. I go there. I did see the club, but I don't think the club delivers to San Diego yet.

    Alex Milligan 18:28

    Not yet. Not yet. But but we will soon And to your point about taxes, you know, that is still what we're seeing across the board. Even you know before legalization, the average cannabis consumer that the large majority of cannabis consumers are are price sensitive. You know, I don't think that there's necessarily yet enough differentiation and additional perceived value that's being created simply from great brand building. And people are realizing that the quality of products while there are certainly moves in either direction happening right now, you can find any number of brands to offer a very similar product experience, a totally different price points. And people tend to be more price sensitive. And so NuggClub was really founded in part you know, to address that problem of just everything is too damn expensive. And so what we've been able to do through our model is provide a method by which we can curate specific brands that we really enjoy as you know, cannabis experts or consumers ourselves and personalize them to the individual consumer and through the way that we work with brands offer those products on a regular basis at a price that you're just not going to find a dispensary and so You know, I think ultimately, that is what is drawing a lot of people to nightclub is the fact that they can spend half as much on the same or better quality products. And they don't need to go into the dispensary, figure out what's right for them, literally we basically curate and tell them, Hey, this is what's great this month, and we are constantly on the hunt for new top shelf brands and products from all across California. So they're even getting stuff that they might not be able to find at their local dispensary. And so it's really that blend of discovery. You know, like I mentioned, exploring, you know, what California cannabis has to offer. And at a price that is drawing people into the service. And then, you know, I think it's made even better just by the fact that there's a awesome, really good looking box with, you know, it's kind of just like a Christmas present, every time you get it, you open it you don't know what to expect, comes with a bunch of little freebies and extras and swag. And of course, you know, part of the curation element of what we offer is that the products themselves come with pretty robust information, you know, about them, and the brands behind them. So people like that educational component as well. So I can't wait for us to deliver to San Diego, I would love for you to try it.

    Kannaboom 21:22

    Yeah, looking forward to it the way you describe it. It's kind of a perfect market for that. I mean, there's a lot of innovation happening. Live resin, a nano CBD or something. I mean, it seems like every every week, every month, there's a new product that you know, for someone my age I'm I'm a baby boomer and there's a lot more to it now than just kind of rolling a joint, there's so many other options to have a guide on that is really a nice value add.

    Alex Milligan 21:47

    Exactly, exactly.

    Kannaboom 21:49

    You guys are a couple years into this. I don't know if you still consider yourself a startup. But is this kind of the perfect market for a startup?

    Alex Milligan 21:57

    Yeah, really good question. We are most definitely still a startup? Um, I would say it is No, it isn't. I don't I don't think anything in this industry is black and white, I don't see very many things that are like firm rules that hold in every situation. In terms of why it is a great market for for a startup, you simply have large potential competitors that are forced to remain on the sidelines, right, you don't have the pharma companies, you don't have the Amazons of the world able to come in and simply dump massive amounts of capital into creating infrastructure and taking over this market simply because of the Federal legality of it. So in that sense, there is a bit of a bubble where startups have the runway to experiment and to understand how to operate within this industry, without fear necessarily that someone's going to come in with billions of dollars and just trance all over them. That being said, you know, the market has obviously evolved, if we're talking California specifically, but elsewhere, as well, over the last several years, there's a lot more money pouring in. And there certainly are players that can be classified as large at this point, right, and certainly have resources and you know, just bandwidth to be able to move around and accelerate the rate of their progress. So that's, that's how it is good, I think for startups. But on the other hand, I think that being first in a new industry, where there is no playbook for literally anything, and not to mention, it is a pretty highly regulated industry, that is just dangerous, you're going to trip up countless times. And for many businesses, it proves lethal, you know, to have to navigate something that's never been done before. I think that it requires an extreme amount of financial prudence, to take just the right amount of risk to place your bets carefully. And there's like a strong chance or a strong inclination for a lot of startups, especially ones that raise money, I think, to deploy capital, go hard into customer acquisition, and then overextend themselves before they've created a solid sustainable business model. So I think that's one of the dangers is that we're simply navigating, you know, waters that have never been charted before. And when you stack regulations, onto all that, which adds a whole layer of complexity and limitations. And it's just a massive time suck to be able to operate legitimately in this industry, you end up with just a whole ton of complexity. And it's not easy. It's really not so in a sense, yeah, there's definitely a protective bubble, I think around this industry. And that if you're willing to take the risk and accept the fact that there is a very high probability of failure, the potential payoff is as large I think. But to say that it's, you know, an easy industry to start in, I think, is just totally untrue.

    Kannaboom 25:44

    Right? I mean, there's probably a lot of uneducated people jumping in before they understand some of the nuances you spoke of. But yeah, it's a blue ocean. I mean, it's wide open. And it's great to be nimble. But as you say, there's a lot of potential missteps along the way to hats off on your progress on the three fronts that you're making progress on already. I think each one of those by themselves would be a complicated business, but to be doing all three of them in kind of a synergistic way is really impressive. And I bet you're waiting and hoping for that federal decriminalization, which really could simplify things a bit.

    Alex Milligan 26:21

    It would, it would, I will say that for the folks that do learn to navigate in a, in a complex system, basically, that is the cannabis industry, you end up accruing advantages, if you put in the time and you know, have the team, it really comes down to team, do you have the right people that are going to be the hustlers that are going to figure out and write the playbook in this industry? I think if you have that, then you are in a much better position. So in a sense, yes. decriminalization legalization, etc, would open the floodgates, and I think, right, you know, rising tide lifts all boats type of situation. But at the same time, you know, we're in a position right now, where we feel pretty confident that we've been through the wringer to the last several years, and we've solved some of the toughest problems there is to solve for our business personally, that we actually think we're strategically well positioned to, you know, to bear the fruits of that labor and out compete, perhaps some of the other players in the space. That being said, there's so much opportunity for everyone that our mindset is certainly not necessarily to ruthlessly compete, I think there's so much room for, for plenty of, you know, brands and companies within every vertical in this industry to find success.

    Kannaboom 27:54

    You mentioned your team. And I think that's obviously important in any kind of startup, to have the right kind of people, I wouldn't say it's a perfect bifurcation. But there is sort of a belief that there's old school hippies, who were growing this stuff up in the Emerald triangle, and then there's like, Guys in three piece suits who are throwing a lot of money at it. Those are both stereotypes that are assuredly incorrect. Somewhere in between is what you're doing applying technology in the right kind of brainpower in the right way. And I gotta say, I gotta compliment you on your brand, too. I think there's just a friendly vibe about it that is really appealing. Is that an important part of what you're doing?

    Alex Milligan 28:32

    Um, first of all, thank you. Yeah, especially with the nug club, I think is where we've really started pushing the envelope, you know, at least for our team, and how we think about brand. And it has been an evolution to the various lines of business to understand how we do that. But, you know, as a whole, I think, within the industry brand, is probably one of the most important things. You know, the reality is with just regulations and the federal legality of cannabis, you have limited access to performance marketing channels that every other industry has access to right Google ads, Facebook ads, Instagram, what have you, the cannabis space struggles immensely to, to, you know, to make its way into those channels, you can in some ways, get your way around some of those regulations, but it's never sustainable. In our experience, it usually ends up in more trouble than it's worth. So the reality is there are simply limited methods by which you can actually reach your end consumer. And with that being the case, I think building a brand that emanates on its own and is accelerated, and, you know, embraced by people almost exclusively through word of mouth, and just the incredible products and experiences that you're building for people. I think that is one of the only options that cannabis companies have right now to be able to grow their business. So Brandon, I think, can't be overstated with how important it is.

    Kannaboom 30:13

    Well, and you did mention SEO. And if you can't use Google ads or Facebook ads, understanding a, you know, its health and wellness or in some places, it's more focused on chronic and medicinal conditions. But understanding where that consumer is coming from what's on their mind what they're likely to put into the search box, when they're sitting down to look for a product, you guys have to have a good understanding of that.

    Alex Milligan 30:37

    Yeah, yeah, it's a it's definitely a channel that I recommend most companies to consider heavily, I wouldn't recommend every every company to jump headfirst into SEO or content marketing, without, you know, doing proper due diligence to understand whether there's an opportunity for their specific product to benefit from organic search. But I'd say is one of the main channels that is going to, I mean, across almost any industry, if you have a product that has, you know, high enough irrelevance and is simply like, mass market enough, SEO is, is going to be hands down the most effective channel for for most industries and products, if you can make your way to a dominant position within you know, search results. That being said, it is not a short term, it is not a medium term channel, it is absolutely a long game that requires upfront investment that you're not going to see back for a minimum of nine to 12 months, I'd say if you're just getting started. But it is one of those channels that once you have invested years into it, the benefits continue to accrue and you're in a better and better position over time. And that's, you know, that's a tough decision that every business and in cannabis needs to need to make, I think. But ultimately, I do think with federal legalization, SEO as a channel that's worth investing in will be a matter of when not for most companies and brands. But yeah, it's one of those just remarkable, remarkable ways of reaching people that ultimately becomes one of the most effective in terms of ROI, large upfront investment, ongoing, pretty decent, you know, investment needed for maintenance and upkeep. But what you can gain from it in the long run if you are in those number one, number two, number three positions, four major search terms that have commercial or, you know, buyer's intent. It's just remarkable what you can get from that channel.

    Kannaboom 32:58

    Are you ever tempted to kind of shortcut your way to consumer mindshare through the celebrity channel? Like we see Snoop Dogg and Martha Stewart have CBD and cannabis brands? And certainly, you know, you see Hollywood guys, George Clooney had a tequila brand that he sold for a lot of money. Does this celebrity channel hold any appeal for you?

    Alex Milligan 33:19

    It does. It's definitely a tool in the toolkit. I think it needs to be considered with extra scrutiny compared to other options. And this is certainly not born out of any research that we've done. There's incredible people throughout the industry that I think I've reported on this already. But we certainly believe this just from a first principles perspective that you know, if you're going to engage any celebrity or you know, popular endorser for your brand, that they need to align just absolutely perfectly with your brand. And that can be really, really difficult to do. I think specifically within cannabis as opposed to maybe like alcohol or other industries. I think what we are seeing is that consumers are a lot more and it might be an age thing. It might be a demographics thing. It might be just the world we live in, in 2020 surrounded by, you know, influencer culture and whatnot that authenticity reigns supreme. I think consumers are a lot more discerning within the cannabis realm. And a lot more skeptical of brands that align themselves or are started by celebrities frankly because it is seen as or you risk being seen as simply trying to cash in, you know, on the green rush basically. But you do see examples of celebrities that are doing this really well. For instance, the cookies brand, with I believe, you know, Burner, as the rapper behind that, you know, they've he's been, he's been a part of cannabis culture and the California cultivation scene from what I understand going back 20 years. So this is a guy that, you know, cannabis has been, you know, part of his life. And, you know, he's been surrounded by it for four decades at this point. So when he comes out and builds a brand, he already knows who his target customer is, he already knows how to talk about cannabis, his audience already knows that he, you know, is a cannabis enthusiast and proponent. So that alignment is inherently there. Whereas, and you know, Snoop Dogg I think, naturally has that as well. I frankly can't speak to you know what type of success that brand is seeing right now, because it's not very prevalent in California. But you know, Martha Stewart, some of these other athletes coming in trying to get on the CBD craze. I think consumers nowadays can see through that and view that as inauthentic. And you actually risk a lot with putting your brand in that situation to be associated with someone that is not going to be viewed as authentic. So we haven't made any serious moves in that direction. But it's possible that we might in the future. Outside of cannabis, an example of a brand that I think's doing this has done this well recently was Peloton, signing with Beyonce for a few years or whatever. I personally think that's a magical brand alignment. Just knowing the audience that peloton has, and, you know, trying to bring a level of entertainment and lifestyle kind of culture into their, you know, fitness from home products. So I think ultimately, brands just need to be really careful about who they align themselves with. And make sure I think as well that the partnerships with the celebrities are not rooted strictly in monetary or financial performance. I think there just needs to be a love that goes both ways. The team, the company, the brand, needs to love what the celebrity stands for, and vice versa.

    Kannaboom 37:15

    Right? That authenticity, as you say, is so important. And at the end of the day, humans are unpredictable and your brand has to have absolute certainty. Some of those professional athletes, you don't know where they're gonna go. Yeah, I totally understand any reticence there. Any other businesses you mentioned, Peloton, but are there other businesses that you really admire?

    Alex Milligan 37:38

    Oh, that's a great, good question. There are countless, always hard on the spot to necessarily think of which ones are the most of highest acclaim, I guess? an unpopular answer, probably. But one that I'll stand by is, I mean, they're obviously a Goliath at this point is just Amazon. I mean, they've got the resources to do anything. But the operational excellence that comes out of that company just never ceases to amaze me. What they've done in terms of turning cost centers into profit centers, I think is something that the cannabis industry could, because learn from a little bit in that, you know, when Amazon first started creating what eventually became AWS, it was really, you know, digital infrastructure for their own services and back end processes. Which they now turned into a more lucrative business than their retail business. They're doing the same thing right now with their shipping. So prime shipping, their air freight, and all that is, you know, was born out of a need to improve their logistics, but now they are going to start offering that as a service. And I just can only imagine, you know, what Amazon is going to do when they are rivaling USPS, FedEx, UPS, etc. So I mean, just the way that that company has managed to basically achieve strategic fit amongst the activities that they pursue is just a marvel in just business, actual currency and operational efficiency. I think every company in any industry can, can learn from what they do. I think Airbnb is another brand that I love. I know these are huge brands that I'm mentioning, but Airbnb, specifically, as it relates to being a brand and a company that operates within the gig economy, but has so clearly, you know, place their flag in the ground, on where they stand, in terms of how gig economy workers should be treated. is something that I think is to be commended, as opposed to Uber and even Lyft. And some others, you know, on demand, gig economy services that you see where it seems, at least to me, that there's a high level of exploitation basically going on, that these gig economy workers are getting the short end of the stick. I think Airbnb has done a phenomenal job of making sure that taking care of their hosts and their gig workers, and making sure that there is an equitable and fair exchange of value, there is something that you don't see very often these days, and I think needs to happen a lot lot more across the board, whether you want to call that corporate responsibility or whatever other buzzword, I think there's something to creating ethical business models that scale and don't inevitably become extractive or exploitative of the workforce that supports them.

    Kannaboom 40:59

    Right, that would seem to be essential for long term sustainability. I mean, if you're, if you are exploiting your human resources, at some point, that seems like it's going to come back at you.

    Alex Milligan 41:11

    The issue with Uber, is I and I don't know that the workforce necessarily knows they're being exploited to the extent that they are I don't think, and not to discredit, you know, the attention that these workers are paying to their own livelihoods. But it's just a hard calculation to make to be able to understand, you know, what type of outcome you're ultimately getting when you're factoring in depreciation, wear and tear on your car, like all those other components not getting the benefits of being an employee. It's a, you know, I personally don't know if I could accurately make that calculation either. But it seems that the word Yeah, ultimately, I think you're right, at some point, you know, it's going to become pretty obvious that the trade off is not necessarily worth it, that one side is getting the better end of the deal. I don't know if we're there yet with some of those gig economy companies. But inevitably, you're totally right. The to create, you know, sustainability by way of making sure the, you know, human capital has been treated appropriately is absolutely critical.

    Kannaboom 42:22

    Yeah, the Amazon story. I can't remember the name of the film, but there was a sci-fi movie set in the dystopian future. And there's still Amazon deliveries happening. I don't know. Not always brilliant. And there's a spoiler that I won't disclose. But if I can remember the name of it, I'll send it to you. But it was brilliant. I have to ask if you have a favorite cannabis product or service other than what you guys do?

    Alex Milligan 42:50

    Yeah, well, I'm definitely a little biased. I think NuggClub is something really special and I definitely encourage anyone to give it a shot.

    Kannaboom 43:02

    It's kind of irresistible, when you think about the value that that delivers. I mean, anybody who is a cannabis aficionado is going to want to try that I would think.

    Alex Milligan 43:13

    and and even beyond that, you know, we are listening to our customers day in and day out. And right now one of the biggest things that we've realized is we don't just want to be able to cater to the aficionado, the person who is consuming quite a bit our target customer right now is someone that's you know, able able to take down $250 worth of product a month or every other month that's that's definitely you know, pretty regular consumer. But we want to be able to give access to the great deals and products and discovery that we offer to even the more casual cannabis consumers so we are going to be offering a smaller box option soon where that price and simply quantity threshold is lowered. So you know, we we definitely hope to be able to offer that offer this to more people but outside of nug club, I mean it's been a real privilege and just you know a fun time being able to see the brands that we get in into the box right you know, we are going out and trying to find the best of the best and only putting them in the box. A couple that come to mind just off the top of my head although I'm definitely not doing justice, the number of brands that should be on this list. Selfies is a really cool pre roll brand. They have basically you know position themselves as creating pre rolls that are you know, purse personal is basically for yourself. I think it's like a half gram per pre roll as opposed to the typical You know, one and a half to two grams that you're getting. Their branding is incredible. They've got these just like awesome like rigid hard case packaging for their prerolls. That has like a luminescence or kind of like a holographic effect. If you're familiar with playing cards from back in the day. That's just really cool to see. And then not club members absolutely love this brand. I mean, they sell out basically every time we restock them, Tradecraft Farms on the flower side as well what they've done with their packaging, I can't actually attest to the quality of their product necessarily. On a personal level, I definitely know that our curators have given it the green light from a nightclub quality perspective. But their packaging and their brand is just beautiful. And I think it is a testament to some of the, you know, innovative stuff that we're going to see from cannabis companies going forward. Let me think what else? I honestly don't do, I don't take edible as much anymore at all. But I've seen some incredible brands from the edible space, Pantry, Kanha, gosh, there's so many.

    Kannaboom 46:03

    I'm a big fan of Kanha myself. I also like Wyld.

    Alex Milligan 46:07

    Yeah, yeah, yes. Yeah, those are the ones that come to mind. But honestly, there's, like you said earlier, there's new ones coming to market all the time. There's incredible entrepreneurs and brand builders and marketers behind these, these companies. And, you know, part of what's exciting about this industry even going back to what we were saying earlier about how larger, you know, larger competitors aren't really able to enter the field is that there still is, even though it's slowly dissipating, there still is this air of camaraderie that exists within the industry, you know, we can all win the pie is big enough. And so there's a lot of experimentation happening. There's a lot of creativity that is just blossoming and is probably in part being, you know, forced by the nature of what's happening on the regulatory side, you know, you have to be creative to basically grab mindshare and attention from the consumer. But yeah, it's an exciting time we're living through right now. And I can imagine it's gonna, it's gonna keep being that way.

    Kannaboom 47:19

    A golden age. Alex, is there anything we haven't covered yet that we should?

    Alex Milligan 47:24

    I will say that. I think I remember a question that you had posed to me over email or elsewhere, it was something along the lines of like the biggest challenges in the industry, I think, for anyone coming into the space as a business owner, entrepreneur, too, acknowledge or just, you know, something that's worth noting within the industry is that the supply chain is still very nascent infrastructure here, it still has a lot of work to be done to be totally reliable. And if you're starting a brand, I'd say plan for that. for there to be bottlenecks and holdups and suppliers and vendors that don't come through all the time, everyone's certainly doing their best, but there are ones that are better than others. And so that is a really tricky component to navigate. And so I just say, for anyone getting into the industry to be aware of that, that, you know, we are not yet at the point, as the consumer might think where, you know, we can bring product farm to table and, and it's the smooth, you know, all the way along that process. There's a lot that's happening on the backend that it really feels like you know, the roof is on fire constantly. So that's that's one thing that's worth worth noting if you're concerned, considering getting into the business.

    Kannaboom 48:48

    I can hear something behind that. I mean, the idea of filling a box every month with an inconsistent supply chain. I bet there were some Chinese fire drills.

    Alex Milligan 48:58

    There's been a couple there have been a couple.

    Kannaboom 49:02

    Thank you for making the time to chat about this. I'm super interested in following you guys in and rooting for you as you go because it's a success story. And I know a lot of our listeners will want to follow up and check you out online. Where should we look for you online?

    Alex Milligan 49:19

    Yeah, not too many places, frankly. NuggClub.com that's snug with two Gs obviously for just our website, Instagram at NuggClubOfficial. We are starting to post more content there and we definitely repost a ton of our user generated content people just sharing photos of their boxes, which happens you know, an insane rate. So it's cool to just go get some box porn I guess. On our Instagram you can see just you know all the different products that have kind of inboxes across the months that we've been in operation for anyone interested in working for us. Reach out to me personally, Alex at GetNugg.com. We also have job postings available primarily through Angel.co search for Nugg. And honestly, we're not very active on LinkedIn, Twitter or anything like that. So I think those are probably the best places to reach us.

    Kannaboom 50:21

    All right. And I'll be looking forward to when that box is being shipped to San Diego and definitely get on the list for that.

    Alex Milligan 50:27

    Yes, yes. Excellent. Tom. Thanks so much. I really appreciate the opportunity to share some of what we're doing.

    Kannaboom 50:33

    Awesome. Thanks, Alex.

    Alex Milligan 50:34

    Have a good one.

    Kannaboom 50:36

    You've been listening to the Kannaboom podcast with host Tom Stacey. If you like the show and want to know more, please check us out at Kannaboom with a k.com. And please leave us a review on Apple podcasts or wherever you listen. See you next week.

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