BDS Analytics, Brightfield Group Quantify the Cannabis Market at CWCB Expo

The global cannabis market is poised to be worth $41 billion by 2024, BDS Analytics’ Kate Senzamici shared during the 2019 Cannabis World Congress & Business Exposition (CWCB Expo) in Boston.

BDS Analytics, a Colorado-based market research firm that produces cannabis market trend reports and consumer research, projects that spending within the legal regulated U.S. cannabis industry will reach $30 billion by 2024. Of that $30 billion, nearly $7 billion will be spent in California alone, making it the largest individual cannabis market in the world.

However, Brightfield Group’s Kay Tamillow has a slightly more modest outlook. Her firm, which combines artificial intelligence technology, market data, and thousands of original interviews to predict future trends, estimates that U.S. cannabis sales will reach $23 billion 2023.

Both groups agree that the majority of consumer dollars will continue to be spent on marijuana flower, however concentrates and edibles are growing in popularity, they said.

“Flower will continue to be a very important piece of the U.S. cannabis market, but we will see it losing share to new product types as the market progresses,” Tamillow said.

According to Brightfield, tinctures, pre-rolls and capsules are the fastest-growing categories within the cannabis sector. In 2019, sales of those three product types are each up about 60%.

Meanwhile, the U.S. cannabinoid market could reach $45 billion by 2024, BDS Analytics estimates, especially as CBD-enhanced products continue to earn shelf space in the broader retail market. The Colorado firm predicts that sales of non-THC cannabinoids at both mainstream retailers and dispensaries will approach $18 billion in 2024, up from just $1.2 billion at all retail outlets (including dispensaries) last year.

For its part, Brightfield is a bit more bullish on the future of the hemp-derived CBD market. By 2023, sales of CBD-infused offerings will eclipse $23 billion, the firm estimates.

The positive future outlook from both firms is in part based on growing consumer acceptance for cannabis. 

A recent BDS Analytics consumer poll conducted earlier this year found that 80% of U.S. adults believe there should be some form of legalization. Meanwhile, 64% of adults polled said they believe marijuana has medical benefits.

“It is generally accepted that cannabis should be legal in some form," Senzamici said.

Indeed, a recent Gallup poll found that two-thirds of Americans still support federal legalization of cannabis.

And as Americans become more accepting of marijuana, cannabis entrepreneurs attempting to understand how the market will evolve in the years to come should examine mature recreational markets, Senzamici suggests. She pointed to flower market share in Colorado, which dropped from 69% market share in the first quarter of 2014 to 41% market share in the second quarter of 2019.

Cutting into flower’s market share are edibles and concentrates, which BDS estimates will account for a combined 50% of the market in 2022.

As products within those categories grow in popularity, it will become increasingly important for cannabis companies to create brand identities that resonate with consumers.

In Colorado dispensaries, for instance, branded products (those sold in 3 or more stores) grew from 19% market share to 44% market share as consumers shifted away from generic labels sold at individual retailers, Senzamici shared.

Also in Colorado, the importance of creating a consumer brand was most evident in the edibles category, where 96% of sales came from “branded” products.

The shift away from private label products to branded offerings has predictably led to a few brands capturing larger chunks of market share. In California, the top 5 edible brands owned 46% of the market in the second quarter of 2019, up from 36% a year ago, Senzamici shared.

Additionally, BDS said 50% of users are “largely influenced” by convenience of consumption when choosing a product. That’s led to a 67% spike in vape dollar sales and a 28% increase in edible dollar sales.


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