Functional Mushroom Marketing

The Ultimate Guide to Marketing and Scaling Your Functional Mushroom Business

Reading Time: 13 minutes

The fungi economy is mushrooming at a rapid pace. According to the 2023 Zion Marketing Research report, the global medicinal mushroom market stood at $15.3 billion in 2022 and is slated to reach $23.3 billion by 2030—a CAGR of 10.1%. Yet, scaling their functional mushroom business remains a challenge for small and medium-sized cultivators operating in a highly competitive, fragmented, and regulated market. These companies run a lean operation, and onboarding a marketing team to drive growth will impact cash flows since growth always lags behind investment.  

The solution lies in collaborating with companies that offer Marketing as a Service (MaaS) and enable you to access the benefits of a dedicated and highly skilled marketing team at a fraction of the cost of onboarding talent. As a cultivator, this collaboration enables you to focus on the critical piece of scaling your production and navigating the FDA and FD&C guidelines while the agency focuses on driving your business growth, from crafting your business plan, reaching out to targeted leads, and converting them to your clients.

1. Opportunities and Challenges in Marketing Functional Mushrooms

Functional mushrooms fall into two broad categories:

  • Medicinal Mushrooms: The antioxidant and cytogenic properties of mushrooms like Lion’s mane, Chaga, and Shiitake reduce the risk of Heart disease, Cancer, PTSD, and Alzheimer’s, to name a few use cases. When consumed as food additives, the sale and marketing of the mushrooms are governed by strict FDA guidelines.
  • Adaptogenic Mushrooms: Mushrooms like Reishi, Turkey Tail, and Cordyceps contain adaptogens, compounds that help the human body to adapt to and overcome chemical, biological, and physical stress. Since these mushrooms are sold as whole food products, their production and sale are governed by a more liberal FD&C act.


The biggest opportunity for functional mushroom businesses is a market that’s growing at 10% or doubling in value every seven years. With the right strategies and selective investments, small and medium-sized companies have the chance to scale at 2-3X the industry growth rate. 

Demand from health-conscious Millennials and Gen-Zs, increasing scientific evidence on the benefits of functional mushrooms, and a growing trend towards a vegan diet ensure that the demand growth will be sustained over the long term.   


The functional mushroom industry is governed by stringent, complex, and sometimes confusing regulations. For instance, functional mushrooms sold as whole food products are governed by the FD&C Act and do not require FDA approval. However, the same mushrooms, when sold as powder or pills, are classified as food additives, and now they need both FD&C and FDA compliance.  

As a cultivator, you are already working within this regulatory framework, and scaling your production becomes simpler because incremental produce does not require additional compliances. Additionally, as the regulations catch up with the research-based evidence of health benefits, the regulations will become more lenient in terms of advertising and how you can promote and market functional mushrooms. 

The other challenge confronting functional mushroom businesses is the highly fragmented and competitive market, with many small and medium-sized companies servicing local and regional demand. Scaling in this market requires a step-by-step and long-term approach, first consolidating your presence in your local market before moving on to regional, national, and global markets. To succeed, your marketing plan and goals must reflect this ground reality.

2. B2B and B2C Functional Mushroom Marketing

Your functional mushroom marketing strategies will focus on two different segments of consumers. The first is business-to-customer (B2C) selling, wherein you sell directly to the consumer, and selling to consumers from your website and participating in farmers markets are examples of B2C selling. Meanwhile, business-to-business selling (B2B) entails selling your product to an intermediary who, in turn, sells it to the final consumer. Selling to local and regional supermarket chains, companies that use mushrooms as an additive, and pharmaceutical companies are examples of B2B selling.

Let’s take a quick look at the broad differences between B2C and B2B marketing.


Source: Postcron

Based on the infographic above, five key takeaways need to be integrated into your marketing plan when selling to B2B customers.

  1. Volumes: B2B selling has higher order volumes per customer, and while you may work with fewer clients, their order sizes are much larger than in B2C selling.
  2. Efficiency: Larger order volumes are accompanied by a higher price sensitivity, and hence, you need to ensure operational efficiency to meet the sharper price points.
  3. Education: Purchase triggers in B2C selling are often based on emotion, while B2B purchase decisions require client education on the benefits and USP of your brand and products.
  4. Multiple Stakeholders: B2B marketing entails selling to a group of individuals within an organization who will collectively make a decision to buy functional mushrooms from your company. Let’s say you’re marketing to a company selling mushroom tea; you will need to engage with the chief product officer (CPO), the CFO, and the purchase manager, who will collectively make the purchase decision.
  5. Sales Cycle: Based on the factors mentioned above, the B2B sales cycle is considerably longer than the B2C cycles, and hence, B2B selling requires a longer-term vision and strategy.

It’s also important to note that B2B business is based on long-term relationships. While it takes longer to convert a B2B client, as long as you continue to deliver on their needs, you’ll have a loyal client for the long haul.

3. Crafting Your Functional Mushroom Marketing Plan

Your marketing plan is the roadmap you use to scale your functional mushroom business. The plan aligns your business with the growth goals and defines the marketing strategies you will execute to achieve those goals. The plan includes metrics that you will use to measure the effectiveness of each strategy, thereby enabling you to make course corrections where needed. 

Here are the seven elements of your marketing plan:


  • Business Objectives: Define your business objective in terms of a target revenue. Let’s say your sales for the last year were $5 million, and over the next twelve months, you want to ramp this to $8 million. This revenue target becomes your business objective.
  • Market Segments: The $3 million of incremental revenue will come from a mix of four segments, and you need to make a rough estimate of how much will be allocated to each segment.

      • Existing Product and Market: You’re selling your whole mushrooms to three local supermarkets, and you add two more to your customer base.
      • Existing Product New Market: Here, you’re selling your existing products to a new market. For instance, you’re now adding regional supermarkets and restaurants to your customer base.
      •  New Product Existing Market: You add powdered mushrooms to your product range and sell it to your existing clients.
      • New Product New Market: Since mushroom powder is an additive in ersatz coffees, you’re now selling to a new market segment that sells ersatz coffee. 
  • Set Priorities: With the business goal in place, you next need to set a budget for your marketing plan and prioritize the strategies that you will use.
  • Marketing Goals: Your marketing goals are the metrics that measure the progress toward achieving the business goal. These metrics include quarterly revenue targets, ROI on your marketing spend, and lead conversion ratios. 
  • Measure and Recalibrate: Establish a plan to measure your monthly performance to identify strategies that are delivering results and those that need recalibration.

4. Building Your Functional Mushroom Marketing Funnel

To acquire new customers, you need to start by building out your B2B marketing funnel. The funnel helps attract relevant leads and nurture them to conversion. The leads you identify pass through three stages before converting to customers and to nurture them, you need to craft content that is unique to each stage. 


Source: Adrienne Smith


At the top of the funnel, you are addressing a large qualified base of leads, a few of whom will eventually buy from you. The objective at this stage is to build awareness of your brand, your product range, and the health benefits of functional mushrooms. This is the stage where you nurture the leads with content that establishes you as an authority in your business segment. This is also the stage where you start identifying the leads that are more likely to convert based on their engagement level with your brand. 

Blog posts on the health benefits of functional mushrooms, infographics that translate complex research data into easy-to-digest visuals, and a professional website are strategies for building brand awareness and authority at this stage.


The middle of the funnel is the consideration stage, where your potential buyers are aware of your brand and are in the process of evaluating different functional mushroom suppliers before making a purchase decision. Content types like ebooks that focus on your unique selling proposition (USP) and the benefits of sourcing from you, as well as strategies like email marketing, help nurture your leads toward the final stage.


Once your leads reach the decision stage, they are ready to make the purchase, and content that highlights your competitive value, an offer for a free trial of your products, and referrals from your existing customers help drive purchase decisions in your favor. Converting the leads at the decision stage must be accompanied by a frictionless customer experience from placing the order to fulfillment and delivery.

Pro Tip: Unless you have an in-house marketing team, the marketing piece from lead generation to conversion should be outsourced to a MaaS agency with a specialized team that can build and scale out your marketing funnel.

5. Content Marketing Strategy

Content marketing lies at the heart of all marketing strategies. A content strategy helps build brand awareness, educates your audience, differentiates you from your competition, and drives conversions. Your content strategy rests on four pillars, as shown below.


Image Source

Your content strategy needs to align with your strategic growth plan. Each market segment that you target will have its own unique plan. For example, the plan to target businesses that use mushroom power to make pills and beverages will differ from the one you use to target national supermarket chains. Next, your content needs to establish your brand USP and why you stand apart from the competition. High-value content that informs and educates your audience helps build your brand authority and engagement with your audience. 

Here are five best practices for crafting your content strategy.

Define the Target Audience: Defining your target audience and understanding their needs enables you to create high-value content that nurtures the audience and moves them down the marketing funnel. 

  1. Identify Audience Needs: You must first identify your audience’s needs and pain points before creating content that aligns with those needs. This will make your content relevant to your audience. According to Semrush’s State of Content Marketing 2023 report, researching your audience is a leading factor for content marketing success.
  2. Identify Content Goals: Align your content strategy with your business goals, which could range from raising awareness and generating leads to educating, nurturing, and converting your leads.
  3. Full Funnel Content: Since the B2B customer journey is much longer, you need to ensure that your content library includes content that engages and informs your leads at each stage of the marketing funnel.
  4. Distribution and Promotion: Creating relevant and high-value content is the first step, but it is equally important to distribute and promote the content on platforms frequented by your target audience. Your audience research will highlight the platforms your audience frequents. This ensures visibility of your content and fosters a higher audience engagement.

Pro Tip: In-depth technical content is vital for engaging and converting your B2B leads. Some common purchase drivers in B2B functional mushroom marketing include quality, supply scalability, order lead times, and product range. Craft your content around these drivers.

6. Email Marketing

According to a 2023 study by Constant Contact, email marketing offers an ROI of $36 for every marketing dollar spent, the highest return among all marketing strategies. The length of B2B sales cycles, coupled with the fact that you need to address multiple stakeholders with unique needs, makes email marketing the ideal vehicle for getting your message across. 

The key to successful B2B email marketing lies in tailoring your message to the needs of the different stakeholders at the company that you are targeting. This ensures that your message resonates with your audience and helps drive your desired business outcome. 

These are the three best practices for B2B email marketing that you need to incorporate into your email strategy.

  1. Build Your Mailing List: Building your email list is the first step in launching your B2B email campaigns. Once you have identified the market segments that you want to target for business growth, the next step is to identify companies with those segments that you want to target. A quick LinkedIn search will help identify the relevant stakeholders in those companies. Using a lead magnet on your website wherein you offer relevant content in exchange for the viewer’s email address is another strategy to build your mailing list.
  2. Segment Your Mailing List: The next step is to group your mailing list into homogenous segments based on the B2B stakeholder’s needs. For instance, let’s say you’re targeting a pharmaceutical company. The chief product officer is interested in the technical and qualitative aspects of your offering, while delivery lead times are critical for the purchase manager, and the CFO is focused on value. Segmenting your mailing list by functions is one way of ensuring that you address each stakeholder with relevant information.
  3. Personalize Email Content: Once you have segmented your mailing list, create buyer personas for each segment that give greater insights into the needs and expectations of that segment’s members. These insights will enable you to hyper-personalize your emails and help with metrics like open rates and conversions.

7. SEO for Functional Mushroom Marketing

B2B search engine optimization (SEO) is a marketing strategy that helps increase your website’s traffic volume by ranking it higher on search engines like Google and Bing. SEO is driven by keywords that your B2B decision-makers use while searching for information. B2B SEO rests on four pillars that help improve your search rankings.


Image Source

Technical SEO

Technical SEO is focused on optimizing the functioning of your website, thereby making it easy for search engines to navigate and index your website. Technical SEO also improves user experience by eliminating friction points like slow page loading and website errors. 

On-Page SEO 

On-page SEO optimizes elements that enable search engines to align specific pages of your website with relevant searches. The primary focus here is on tactics like keywords, metatags, descriptions, and content optimization. On-page SEO also ensures that your website’s pages are interconnected, which helps raise your website’s domain authority.

 Content Marketing

Content marketing is also an integral SEO strategy. Creating content around keywords and search phrases helps in driving relevant traffic to your website. As part of your SEO strategy, you would also conduct an audit of your existing content to add keywords and high-value infographics that can improve your search ranking. 

Off-Page SEO

Off-page SEO focuses on promoting your website and content on third-party websites by using link-building, paid promotions, and social sharing. These strategies help in improving your domain and topical authority, thereby ranking you higher on relevant organic searches.

8. B2B Paid Advertising

Paid advertising is an important B2B strategy for reaching out to your audience to build awareness of your company and drive engagement with your brand. There are three key B2B paid ad platforms that you should consider:

  • Display Ads

Google Display Network showcases your message and branding to your relevant audience on the platforms that they frequent when they are online. Additionally, Display Advertising allows you to create a wide range of ad types, including text, image, interactive, and video ads. 

  • Pay Per Click

Search engines like Google and Bing run PPC ads. The advertiser creates the ad, bids on keywords and search terms that trigger it, and pays the search engine every time a viewer clicks on the ad. The amount you bid impacts how often your ad is shown by the search engine. Since you only pay when the viewer clicks on your ad, you have the flexibility to experiment with different keywords and terms to find the mix that works best for your needs.

  • LinkedIn Ads

LinkedIn markets itself as the ultimate lead-generating platform. The B2B companies you target for selling your functional mushrooms and the relevant stakeholders in those companies are all on LinkedIn. The platform offers an advanced targeting functionality, including company, job title, years of experience, and industry niche, to ensure that your ads are viewed by the right audience. 

Pro Tip: Allocate a fixed budget for your paid campaigns and define the metrics you will use to evaluate the performance of your ads. Managing paid ads is a specialized digital marketing skill, and hence, you should either onboard someone with the required skills or work with a professional MaaS agency.

9. Tips for Scaling in a Fragmented Market

A big growth challenge in the functional mushroom industry is the highly fragmented and competitive market. The standard organic scaling playbook may not work in this market, and hence, you need to keep these two tips in mind when you are formulating your growth strategy.


The normal scaling playbook would call for you to set up offices, warehousing, and distribution networks as you scale across geographies. This adds to overheads and would make you uncompetitive in a price-sensitive market. Instead, look at working with distributors and wholesalers in the relevant geographies who already have an established warehousing and distribution network.


Don’t enter a new geographic or functional market with your entire range of products, as that would raise your market penetration cost. Instead, identify the two or three products that are in high demand in the market or products where demand exceeds the current supply. Enter new markets with these products and establish your brand before adding new products. 

Expand your brand footprint step by step and accept that no single brand can capture a dominant market share. 

 Wrapping Up

Marketing and scaling your functional mushroom business requires a complex strategy with many moving parts. The real challenge lies in coordinating the different marketing strategies while keeping them aligned with your business growth goals. 

The best advice for cultivators looking to scale their business is to collaborate with a digital marketing company that can do the heavy lifting with their large and multi-skilled marketing team. Last but not least, it’s important to remember that business growth is a marathon and not a sprint. Good Luck!

More About Flying V Group

The team at Flying V Group is multi-skilled, globally distributed, and online 24/7/365. We are partners in your growth story and believe that long-term relationships are based on delivering win-win outcomes and a healthy ROI. 

We start by understanding your business and then build a solution customized to your growth needs and internal workflow. Our business growth framework rests on five marketing pillars: SEO, Content Marketing, PPC, Social Media Marketing, and Website Design. Our custom-designed marketing dashboard keeps you updated in real-time. 


Q1. Which functional mushrooms help in improving sleep patterns?

The Reishi mushroom is used extensively to regulate sleeping patterns while enabling non-REM sleep. Lion’s Mane improves the quality of sleep without making you drowsy, and its nootropic properties help rejuvenate brain functions while reducing neurodegenerative cascades.

Q2. What are the benefits of mushroom pills?

Mushroom pills are used as a health supplement for day-to-day benefits like better brain function and concentration, a healthier immune system, and higher energy levels. They are often made with powders of different mushrooms; hence, one pill can provide multiple health benefits.

Q3. Can functional mushrooms help you lose weight?

Mushrooms are high in vitamins, minerals, and antioxidants, and medicinal mushrooms like lion’s mane, reishi, and cordyceps can aid in weight loss. They are also low in calories and can keep hunger pangs away since they don’t spike blood glucose levels. 

Q4. Do mushrooms help in removing toxins from the body?

Research shows that mushrooms contain more than 120 enzymes that help break down the toxins in your body.

Q5. Do mushroom supplements have side effects?

Although mushroom supplements contain beneficial natural extracts, the body can occasionally react to these extracts. The side effects can range from an upset stomach to dizziness, nausea, and general discomfort. 

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Written by Flying V Group

Founded in Orange County, CA, Flying V Group is one of the top full-service internet digital marketing agencies that specializes in website design, search engine optimization, pay-per-click advertising management, and social media marketing. We are specifically located in Irvine, California. Get in touch with us here!

March 22, 2024



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