3 Predictions for Cannabis and Hemp in 2021
What retailers and consumers can expect.
1. Hemp will diversify
The hemp business is set to continue tremendous growth throughout the year and beyond. While hemp-derived products like CBD gummies and oils are currently all the rage, there is likely to be new uses of the fibrous portion of the plant, such as biodegradable plastic alternatives, textiles, paper products, and more.
As we look to the future, the usages of hemp will continue to be far more mainstream and distributed than ever before, and we'll likely even see it expand into insulation and geotextiles in building materials.
To prepare for this anticipated new wave, hemp farmers and cultivators should put themselves in the customer's shoes. Ask what products can you create based on customer needs and what are they looking to buy?
To keep a pulse on where the industry is headed, plan to engage with customers often. This is a young industry, so it's essential to know where and who everything comes from. Farmers and cultivators should give themselves time to learn, allowing room for failures here and there. It will be crucial to be extra conscious of the genealogy of seeds, asking questions, analyzing lab reporters, and being diligent. The higher quality seeds a cultivator can start with, the more likely it'll produce higher quality plants.
2. More Millenials and Gen Z will become customers
Over the last year, our data strongly suggest that sales (e.g., average order value, number of orders placed) from every single age group – from baby boomers to Gen Z – and every demographic is growing. That said, the two fastest-growing age groups year-over-year are millennials and Gen Z. These generations have grown up in an era in which the stigmas surrounding cannabis have been lower for most of their lives, so the mental barriers that they have to overcome to become consumers are much lower in comparison to baby boomers and Gen Xers.
The trends in sales growth across all segments will almost certainly continue over the next year. But while it's now legal to use cannabis recreationally in several states, the subject of where consumers can consume and indulge is still open-ended. As the industry continues to grow with millennials and Gen Z and cannabis continues breaking into the mainstream scene, we're sure to see more and more social spaces that will allow cannabis consumption. This trend will explode over the coming months and years with increased numbers of dedicated spaces for cannabis consumption precisely, with new cannabis bars and lounges opening their doors to customers.
Beyond that, the cannabis industry is attracting all sorts of investors and entrepreneurs — including a growing number of public figures like actors, musicians, influencers, and sports stars. With high-profile hip-hop stars like Snoop Dogg, Ice Cube, and Method Man all launching cannabis companies, actor Seth Rogen recently launching Houseplant, and former NBA all-star Chris Webber starting a cannabis social equity fund, the writing is on the wall.
But one thing we haven't seen yet, and are likely to begin seeing, is cannabis brands sponsoring these types of public figures in the same way they currently get sponsored by Nike, Gatorade, and other major corporations. The legalities of these sponsorships now remain a deterrent, even in states where cannabis is legal. Still, with President Biden voicing his support for federal decriminalization of cannabis, that could all change – and soon.
3. Big changes in consumption behavior
The way that Americans consume cannabis will see a seismic shift in the coming year. The consumption of low-dose products will become more popular – especially in environments where consumers face triggers for stress and anxiety, like airports.
As the cannabis industry has matured, cannabis products, such as edibles and oils, have been required to carefully measure and label the amount of THC contained within for customer awareness and safety. This regulated accuracy has allowed consumers to control their own levels of THC and CBD diligently. While the minimal effective dose for each patient will vary, it can be as low as two to five milligrams per day, resulting in a microdose effect. As consumers are increasingly looking for remedies outside of traditional pharmaceuticals, mainstream medical practices are beginning to recommend cannabis for various ailments and conditions. These include elevated mood, reduced anxiety, stress, or better sleep and focus – are communicated to the mainstream, consuming small doses of cannabis will become more accepted and, in some cases, the norm.
As the cannabis industry grows, it will continue to adapt and shift to an ever-changing landscape of regulatory hurdles and policies. Adapting doesn't always mean negative, though, and we're likely to see cannabis in brand new spaces and brand new ways in the coming years.