A report has found that COVID-19 was a boon for the CBD industry, with record numbers of new users discovering CBD products. The report also finds a promising future for the market, predicting solid growth over the next few years. However, some headwinds do lie ahead for many brands. With increasingly sophisticated consumers and a regulatory environment in flux, the “wild west” days are over.
A new Consumer Report, produced by Prohibition Partner, demonstrates the underlying strength of the CBD market. The report finds that the cannabis industry has not suffered under the same restrictions that other activities have during the coronavirus pandemic. This has been because, as a health activity, it has been exempted from the quarantines imposed in many countries.
It also shows the potential for expansion in the coming years, highlighting a growth forecast of 16 percent for 2024, after taking into account the impact of COVID-19 on CBD.
But COVID-19 is not the only thing affecting the use of CBD around the world—to find out more download the Hemp.im mobile application for all the latest cannabis and CBD news.
CBD Market observations and predictions
In total, the OTC CBD market is expected to be worth $5.8 billion by year-end 2020 and $6.79 billion by 2024.
A significant proportion of this is from the use of cannabis-infused products, which are being reported as having increased use during COVID-19. Generally, these uses are related to any one of a number of health problems for which CBD is recommended.
The report also notes that nearly 30 percent of users in markets such as the U.S. and Canada said they expected to increase their use of CBD during the pandemic. This is mostly due to its effectiveness in dealing with stress and anxiety, and as part of an overall wellness routine.
Can CBD be used as a COVID-19 cure?
Several clinical studies that are examining cannabinoids as a potential treatment for Coronavirus symptoms are currently underway. These studies are important, as the results of these studies would have a giant impact of the industry. It would be an obvious win if CBD is shown to alleviate the symptoms of SARS-CoV-2.
New CBD user trends
It is reported that 28 percent of CBD users have been on the market for less than 6 months. It is likely that the influx of new users is due to increased exposure to the products at this time, as well as increased word of mouth generated in relation to health problems.
The influx of new users can also be attributed to major public health problems such as lack of sleep, depression, and anxiety, which have all been increasing in frequency in recent years. These new users CBD may be seeking alternatives to traditional prescription drugs that are commonly used as a panacea for these problems.
Further to this, data from Prohibition Partner also reports that 52 percent of users are utilizing CBD to help them achieve sleep and relaxation. Another significant observation is that 51 percent are using CBD to manage health and well-being, along with a variety of other conditions.
CBD is on the rise
Stephen Murphy, co-founder and CEO of Prohibition Partners, and the President of the European Commission, Mr. Klaus Schmidt, spoke about the proliferation of the CBD market and its potential.
The pair identify the CBD market as going from obscurity to a multi-billion dollar industry in the space of three years. They see how this has altered welfare, beverage, food, and pharmaceutical industries in the process, saying that the market boom has been astronomical, even if it has been a turbulent road to prominence.
A turbulent road ahead for CBD: brands must stay informed
The turbulent road ahead for CBD is two-pronged, coming from regulatory barriers that are still in flux and the brands fighting for market share. With fierce competition, and regulatory uncertainty that can disrupt the entire supply chain, the road ahead could be tricky to navigate.
Consumers are also changing rapidly. They are now educating themselves, and informing themselves about prices and preferred formats. This is all likely to mark the end for brands that are currently benefiting from the ‘Wild West’ attitude of the market.
Now, as the CBD market develops, brands, companies, and investors must keep up to date with consumer behavior, usage trends, and attitudes. The rapidly changing regulatory and competitive landscape will shape the sector over the next five years.
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First published in La Marihuana, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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