Edibles Outperform Cannabis Industry Growth in 2020
Sales of edibles skyrocketed across the nation in 2020 as consumers shied away from inhalable forms of cannabis during the COVID-19 pandemic in favor of more discreet consumption methods.
The surge is prompting edibles manufacturers to invest in research and development and new product lines for 2021.
End-of-year data from Seattle-based cannabis analytics firm Headset shows that for all of 2020, sales of adult-use and medical edibles grew by 60% across seven state markets – to $1.23 billion in 2020 from $767 million in 2019.
That performance meant edibles outperformed the total cannabis market, which grew a hefty 54% last year.
The seven states were California, Colorado, Massachusetts, Michigan, Nevada, Oregon and Washington.
According to Headset data analyst Cooper Ashley, edibles increased their market share from 10.65% in 2019 to 11.07% in 2020.
The increase is leading cannabis companies to pour efforts into developing new product types, including faster-acting and strain-specific edibles.
“We’re seeing the edibles space get a little more sophisticated, and we expect that to continue,” Ashley said.
Cannabis edibles makers cited a number of factors behind the greater market shares, including:
Both new and mature consumers are trying edibles for the first time.
Consumers are shying away from inhalable products and looking for more discrete options amid the coronavirus pandemic.
“We are seeing continued movement toward edibles and non-inhalable forms of consumption,” said Joe Bayern, CEO of multistate marijuana operator Curaleaf, based in Massachusetts.
Bayern – who took over as CEO this month – sees an “overwhelmingly large opportunity” in bringing new consumers to cannabis for the first time. He noted an alternative form of consumption such as edibles was a good way to attract newbies.
“Cannabis is not new to consumers,” he said. “If they want to be smoking cannabis, they probably would be.”
Fastest Growing Brand
One of the fastest growing brands of edibles in the nation is Yeti Yummies, by Yeti Farms. The Colorado brand uses natural ingredients and literally sells out as fast as they can make their popular gummies. Shawn Honaker, owner of Yeti Farms, recently invested in new equipment to be able to make his gummies quicker and more efficiently.
The company attributes its success to its unique and especially delicious flavors, which consumers say just taste better than anything else on the market. Additionally, Yeti Yummies are priced less than the competition.
This combination of great taste and value pricing is making it hard for dispensaries to keep Yeti Yummies on the shelves. But Honaker promises that supply will soon be increasing to keep up with demand. Meanwhile, the company keeps developing new and exotic flavors that are unlike anything else in the market and are delighting customers throughout Colorado.
At Las Vegas-based edibles brand Hervé, co-founder Sebastien Centner also is targeting new cannabis consumers.
Centner sees legacy cannabis users as the market for inhalables – not edibles.
“New users who are already very familiar with high-end products in other categories like food are looking for the same thing in edibles,” he added.
According to Centner, cannabis consumers are discerning about what they are ingesting, and as the quality of edibles products continues to improve, more people will be willing to try them.
In response, edibles makers are producing low-sugar, all natural, no-nartificial products to appeal to health-conscious consumers.
When the pandemic eventually lifts, Centner sees more consumers building cannabis edibles into their lifestyles when they resume their social lives and travel.
“Everyone’s going to get out and celebrate, and cannabis is going to be a big part of that,” he added.
Similar to Curaleaf, Hervé also sees early onset and microdosing as the future of the product.
“There’s nothing worse than having a product and waiting an hour or hour and a half for it to work,” Centner said.
Small increments of THC that act quickly will help combat the problem of new, impatient users who overdo it by taking one edible and then another to feel the effect.
“If you know you’re going to have an effect, you’re not going to be wondering, ‘Should I do another one? Is it going to kick in?'” Centner said.
The company expects to expand into at least four new markets this year. “We really believe 2021 is going to be the year of the edible.”