Sales involving CBD-only products have been slowly declining in four Western US states since 2018. This analysis emerged from a recent study conducted by Headset, a Seattle-based research group specializing in cannabis markets, who tracked the sales data of hundreds of retail stores.
Despite the dip among these specific products, the group asserts that the CBD industry as a whole continues to grow. That growth is driven by two major alternatives: the increase in the number of CBD and THC blends, and the slow saturation of CBD products in major, non-cannabis retailers.
CBD-Led Shift
When looking at adult-use cannabis retail outlets, Headset found that the market share of CBD products had declined roughly 5 percent in California, Colorado, and Washington state, while the share of sales in Nevada fell a full 23 percent.
However, CBD products continue to become more widely available online and at mainstream retailers, and the total value of the market has only risen in the past three years. The combined sales of CBD products in recreational shops within these four states was just under $21 million in 2018. Fast forward to 2021, and that number skyrockets to $42 million.
These two seemingly incompatible trends are possible because THC products are eating into CBD’s market share at adult-use outlets. This is occurring alongside the rise in total popularity of both industries. For example, consumers can now find major CBD brands at stores such as Walmart or Target, as the products continue to become more mainstream.
Other Areas of Growth
The other major area of growth among CBD products involves blends that also contain specific ratios of various THC cannabinoids. These CBD-THC combinations were the most popular option for cannabis consumers in the four studied states, accounting for 38 percent of all CBD sales in 2020. Experts within the industry attribute this shift to a more educated consumer base.
“We’ve seen that the rise in popularity of ratio products is really a factor of more experienced consumers being able to identify what effect they are seeking,” said Eric Block. Block is currently the chief revenue officer for Wana Brands, a major CBD company.
In Nevada and Washington state, the share of sales of products that contain equal ratios of CBD and THC grew considerably since 2018. Nevada saw an 11.2 percent increase, while in Washington state the share grew by 8.8 percent. This suggests a growing number of consumers are beginning to prefer cannabinoid blends over the pure, single-compound products.
Takeaways
This study provides valuable insight as to how the CBD market is shifting in key regions of the US. Most people who shop for pure CBD products nowadays do so online or at larger stores. Meanwhile, people who regularly use THC are beginning to incorporate more CBD into the equation. For CBD companies, blends are now the name of the game. And indeed, the company Wana has made a concerted effort to expand its number of THC and CBD blends. This was done in order in order to keep up with the hike in demand. Cannabis stores more broadly are also expected to adjust accordingly.
Make sure to check back for more cannabis and hemp related news.