Market Overview

Facebook is Killings Small Businesses With its CBD Ads Ban

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After nearly ten years of military service, Jason Higgins was more than ready for the next chapter of his life. Unfortunately, what that chapter brought was years of post-traumatic stress disorder (PTSD), panic attacks and a drinking problem. Not to mention the debilitating side effects he got from the prescription medication he used for his […]

After nearly ten years of military service, Jason Higgins was more than ready for the next chapter of his life. Unfortunately, what that chapter brought was years of post-traumatic stress disorder (PTSD), panic attacks and a drinking problem. Not to mention the debilitating side effects he got from the prescription medication he used for his anxiety and PTSD.

Running into cannabidiol (CBD) changed everything. The hemp extract has become extremely popular over the past few years, with people using it to manage anxiety, high blood pressure, and chronic pain among a long list of ailments.

Higgins was so impressed by the results he felt after using CBD that after the 2018 Farm Bill legalized the cultivation of industrial hemp, he decided to start a business selling hemp-derived CBD products with a fellow Navy Seal veteran.

It seemed like a good business idea at the time. The CBD market was worth at least a billion dollars in 2018, and market research suggested that it would hit $20 billion by 2024. Armed with this knowledge, and with the belief that CBD was a product worth investing in, he poured most of his life savings into building the venture, Easy Day Hemp.

However, one thing he hadn't taken into account was censorship by digital ad giants. Higgins and his partner tried running ads on Instagram and its parent company Facebook, but the ads were immediately rejected and their entire ad account was shut down. He was stunned.

"It's not like we're selling anything that's illegal or dangerous. It's already hard enough to start a new business without Facebook stifling your company. How are we supposed to grow?"

Although Facebook's public policies prohibit the sale of illegal, prescription or recreational drugs, cannabidiol isn't classified as a drug. Still, there are restrictions to differentiate it from illegal marijuana, such as a 0.3% THC (delta-9 tetrahydrocannabinol) concentration.

The FDA has also forbidden sellers from marketing CBD as a food additive or dietary supplement, and from claiming their products have medical benefits without FDA approval.

Aaron Nosbisch has also suffered from Facebook's CBD ad ban. The Florida-based entrepreneur co-founded a start-up selling CBD products in 2018 and ran ads alluding to what he was selling, without explicitly stating that it was CBD. Facebook eventually caught up with him and abruptly wiped his ad account, and he abandoned the startup a short while later.

"Facebook advertising was our main form of traffic. When you get banned, there's not much you can do. You can't get ahold of Facebook. No one will help you. You're just locked out of one of the biggest ad platforms in existence."

Industry experts are sure that established CBD companies like IONIC Brands Corp. (CSE:IONC) (OTC:IONKF) and Sugarmade Inc. (OTCQB:SGMD) must also be feeling frustrated by the advertising ban of CBD products on Facebook.

About CBDWire

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