Here's Why More THC Companies Are Starting CBD Companies
The quest to cater to different consumers in a growing market is growing wider every day.
Judging from cannabis sales -- U.S. adult-use and medical-only marijuana sales reaching $8 billion to $10 billion in 2018 while cannabidiol (CBD) sales were upwards of $238 million, according to Marijuana Business Daily estimates -- consumers are extremely interested in both THC and CBD. So are business owners.
As legalization continues to spread, both will continue to cater to different consumer types in a growing a company's potential market wider than ever before.
The CBD market grew by 57% in 2018, according to the Nutrition Business Journal Hemp & CBD Guide(NBJ). In the study, the NBJ found 73% of natural and organic product manufacturers surveyed are expanding their offerings to include CBD products. The NBJ's 65% of natural and organic product manufacturers expected to launch new hemp-derived CBD products in the next one to two years.
And marijuana companies are getting into the game, too, adding CBD companies and products to their THC-based portfolios. It's a trend that follows the demand but also points to how ubiquitous CBD and THC will both be as legalization marches forward.
Leading industry experts offer advice on why having both THC and CBD products is important, how to speak to both consumer audiences, and demystifying the “versus” mentality between the two markets.
Making both THC and CBD accessible to consumers
There are plenty of ways to display both THC and CBD products on a company website or product platform.
Weedmaps' Brands platform allows companies to customize their page to include CBD products as well as THC products.
Flav is one company that evolved its THC branding to also include CBD branding in a way that feels seamlessly yet separate.
“Our founder outlined the goals to add CBD into the market, to help destigmatize the perception of both THC and CBD,” said Braelyn Davis, Marketing Director at Flav Inc. “As much as we were very much branding ourselves as Flav Rx, the THC product, we were doing R&D [research and development] in the CBD world from virtually the foundation of the company.”
Flav began work on its first CBD vape product prototype in 2015. “We started Flav with THC in mind, but we had always planned from the get-go to launch CBD products,” Davis said.
THC vs. CBD
For some, THC and CBD are two completely different products that don't have anything to do with each other, making for a either/or attitude towards the cannabinoids.
“It's really about being a cannabinoid company,” said Kiana Reeves, Director of Education at Foria, a company founded in 2013 that has Foria Wellness as its CBD line and Foria Pleasure as its THC line.
“We really think that, 'are you THC?, are you CBD?', is not the question. It's about being a plant-based wellness company that is honoring and sharing the plant-based value of cannabis,” Reeves said.
Foria started making CBD products after customers started inquiring for them. “People around the world are like, 'We are hearing the most incredible things about Pleasure or Relief. Can you make something we can have?' We didn't work just with cannabis, we are working with many plants that have endocannabinoid activity. We wanted a CBD alternative for people who couldn't use THC or couldn't have access to it in their market.”
Some people don't want the [intoxication] associated with THC, we understand. But we still love the entourage effect,” Reeves said.
Having experience with extracting cannabinoids from marijuana is especially helpful when it comes to sourcing hemp. Willie's Reserve Vice President Elizabeth Hogan, now representing its newly-launched CBD line Willie's Remedy, explained that the company is just as “cautious about supply chain selection” when sourcing clean hemp as it has been in sourcing marijuana. Careful selection and experience sourcing in one sector can make your company well suited for the other sector.
How to Speak to THC and CBD Consumers
The clarity in packaging is critical to differentiate THC and CBD products to consumers. Labels for CBD products have their own specific regulations from the U.S. Food and Drug Administration (FDA), including required statements that the product contains less than 0.3% THC, as well as warning labels.
CBD product branding often reflects skin-care or wellness products in its package design and subtlety. It can be slightly more toned-down than other cannabis products in its presentation, as the package itself is the best way to tell the consumer about the product's accessibility.
In order to offer high-CBD vape pens and tinctures, Willie's Reserve took a unique approach. “We focus on ratio products,” Hogan explained. The company launched its CBD-exclusive line Willie's Remedy this year, with a focused initial line of offerings featuring CBD tinctures and a dark-roast CBD coffee.
Willie's focus is on engaging consumers and helping them understand how different combinations of THC and CBD can address what attracts them to cannabis in the first place. Looking at Willie's Reserve, Hogan said its high-CBD products are popular among an entirely new demographic of older, wellness-focused consumers.
For the CBD consumer, they are typically looking for a “low daily dose,” Hogan said. Low doses consist of around 5 to 10 milligrams of CBD per dose, while a therapeutic or medicinal dose is about 50 milligrams, according to Hogan.
“The more there is room for cannabis to be a plant in our everyday life, add to our everyday wellness, the better,” Hogan said.