Convenience Channel has room for growth in the CBD market

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NATIONAL REPORT – While CBD is still not nationally standardized, hemp-derived consumer products have become legal under the 2018 version of the US Farm Bill, and 2019 has seen explosive growth in the category. . In late 2019, however, the category suffered slightly when the Food and Drug Administration warned consumers to stop using products containing THC and CBD following an outbreak of lung damage associated with the products.

Many consumers have turned to topicals and other CBD products instead, according to Don Burke, senior vice president of Management Science Associates Inc. (MSA), a Pittsburgh-based analytics and IT company. In fact, topical sales have climbed to number one in the CBD category for quite some time; they recently fell to # 2 with the gummies taking the top spot.

“In 2021, gummy candies have returned to the best-selling product form in convenience stores, followed by topicals and tinctures, and vaping is also starting to come back quite strong,” Burke said. News from the convenience store.

Overall, sales of CBD in the proximity channel have declined from where they were in 2019, and the COVID-19 pandemic has pushed people online to buy these products, which has hurt consumers. convenience stores, noted Mike Luce, president of Chicago-based High Yield Insights. , a data-driven information provider on the cannabis market. The good news, however, is that awareness of CBD and hemp products is higher than ever and sales forecasts are still on an upward curve, he said.

“None of the spaces are saturated like traditional beer,” Luce said. “There is a lot of competition within individual categories, such as candy, but there is still room for growth, and CBD drinks are ideal for the convenience store industry. Currently, CBD drinks are ranked among the highest categories that CBD consumers do not use but want to use in the future. “

Looking at the total adult population in the United States, only 16% are current CBD users, which means they have used a product in the past three months. The growth potential of the category is revealed by the 84% who are not current users, Luce pointed out.

“If you analyze, of those 84 percent, 46 percent have expressed an interest in trying CBD and 13 percent are former CBD users who might come back,” he explained.

Additionally, once the pandemic has passed and shopping patterns return to normal – with consumers heading to work again – sales of CBD are expected to rise again in the retail space, along with the introduction of new ones. cannabinoids such as CBG and CBN, Burke said.

C-stores that may have tried CBD products in the past but were unsuccessful should consider changing their approach and the way they market the products in their stores, according to Tony Sparks, senior vice president of marketing. for Betterment Retail Solutions, a West Des Moines, Iowa-based health and wellness company that connects emerging brands with retailers.

Many may have tried a turnkey distributor program, but Sparks recommends that retailers take a multi-vendor approach to CBD instead.

“We take a multi-vendor approach with floor and counter displays that are not only CBD, but can also contain other functional products and brands,” he explained. “It doesn’t have to be all CBD or nothing. “

He also suggests that convenience stores “call out CBD” in their marketing so that customers know it’s available there – and in a big way is doing it. In fact, Betterment Retail Solutions has tested neon signs that say CBD, so customers will notice them when they walk through the cold door to the vault. Each store with the banner has seen sales increase, Sparks said.


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