Legalization is having a great impact on the direction of both the medical and adult-use cannabis industries. Cannabis is being transformed - in production, in marketing and in consumption. Companies can see explosive growth in this space, but there are obstacles and intricacies to navigate. The most positive part about all of this is that consumers are driving education and brand proliferation and demanding more research and development as well as affordability and quality.
"Good people don’t smoke marijuana." That's what Jeff Sessions stated back in 2016. The struggle is real among cannabis advocates and anti-drug policy makers as the debate continues around efforts to decriminalize marijuana and regulate it federally in the U.S. It's having a huge impact at the Canadian border.
Recently, Politico published that, according to a senior official overseeing U.S. border operations, Canadians working in the marijuana industry and investors in the booming cannabis sector risk a lifetime ban on travel to the U.S.
That hasn't stopped investors from going bananas on the stock exchange. Apparently, weed is the new blockchain. Tilray, for example, has seen its share price skyrocket by more than 600% since it went public in July. Up until now, valuations have chiefly been driven by production capacity, with Canadian licensed producers leading the charge as Canada will be the first G20 nation to legalize recreational cannabis. With other major markets now moving towards legalizing adult use cannabis, the investment focus is shifting to retail distribution, marketing, and sales and it feels as if the industry is on the precipice of change.
Canopy Growth received a $5 billion investment from beverage giant Constellation Brands and Coca-Cola is apparently in talks with Aurora Cannabis to develop a CBD-infused drink. Even premium skincare brands and hopping on the bandwagon – Origins (owned by Estée Lauder) is making an entrance into cannabis with a calming mask that launched exclusively online at Sephora.
These recent developments point to a bright future for cannabis consumer packaged goods as more companies realize the tremendous growth opportunities in the space. The market is maturing and with that comes specific applications and new delivery methods - inhalables, edibles, oils, concentrates, topicals, transdermals. Products will continue to evolve as the adult-use market begins to outpace medical marijuana.
Women are at the forefront of this movement. Women are the world’s most powerful consumers, driving 70-80% of all consumer purchases, and their impact on the economy is growing every year. The global income of women is predicted to reach a staggering $18 trillion in 2018. The majority of new cannabis consumers are women between the ages of 25 and 44, and they are also more inclined to explore low-dose options.
All eyes are on the larger, premium lifestyle, health and wellness market as consumers become more educated and look to cannabis for its therapeutic effects - for anxiety, pain, sleep, energy, happiness and sex. The global wellness industry is a whopping $3.7 trillion market with a CAGR of 10.6%.
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