Hi, everyone, Hope everyone is doing great today. Thank you all so much for joining our webinar then and now taking a look at a 2020 recap. And looking at the latest and greatest of 2020 2021 predictions, excuse me. Um, for those of you who don’t know me, my name is Kelly Nielsen. And I lead our insights and analytics team here at BDSA. And I’m joined by Jessica Lukas, our senior vice president of commercial development. So her and I will be tag teaming over the next half hour, 45 minutes or so as we’re going through this, and if you have any questions, please feel free to type it in the textbox. If we have some time, at the end, we will absolutely try to get to them.
And so with that, you know, I actually wanted to start by giving a really quick overview for those of you who might not work with us directly of what we do, who is BDSA. And our goal really is to provide a complete view of the cannabinoid market, both today and what’s going on, and tomorrow. And there’s really three key pillars to the types of solutions that we offer. The first is our retail sales tracking data. This is all about taking a look at what products are actually moving through market. What is the consumer poll, we cover eight key markets are eight key states use me in the United States and two Canadian provinces. And we get down as granular as the product level looking to understand what is the product was the brand where the price points that are moving through legal dispensary channels.
The second bucket is our market forecasts. So this is all about understanding the market size today, including states markets that we don’t necessarily cover with retail sales tracking, as well as future opportunity, looking all the way into 2026. And we actually currently cover over 30 different markets. And in the US and Canada, we can get down to a super granular level by state or by province and by category. And actually really excited to chat with you today. Because we actually just released our latest, our latest forecasting numbers earlier this week. And so I’ll be able to give you a sneak peek at that.
And then our third bucket is consumer insights. So every year we reach out to 1000s and 1000s of consumers to understand their perceptions and attitudes of the cannabis industry. And so through that we can understand where the segments of consumers or let’s say to consumers that aren’t purchasing cannabis right now and why? What is the different categories or behaviors and attitudes and consumption patterns. And what’s really exciting is we actually have consumer segmentations that we’ve identified based on consumer attitudes. And so as we’re going through this content over the next half hour or so, we’re actually going to be weaving in pieces from all of these different all of these different solutions and data points in order to bring this story to life.
And so the first place that I’m actually going to start, like I mentioned is with our global market forecasts. And these were updated just the other day. So this is fresh off fresh off the market here.
And so what you’re looking at on this slide is the BDSA global legal cannabis forecast. And really quick before we dive into the specific numbers, just to provide some perspective on what goes into this, we leverage a wide range of data available. In order to come up with these projections. We are looking at our own retail sales tracking that’s available in the United States and Canada, we are looking at publicly available information that is provided by states or by countries in order to in order to protect this information. But we’re also taking into account timing of things like when is when is a regulation expect to start? When is product likely to be available? What is the regulatory framework going to look like? And so we’re compiling all of that information at a state at a country level in order to come up with these projections.
And what you’ll notice, so I’m on the far left hand side of the screen, we wrapped up 2020 at about a 21 point 3 billion US dollars in total cannabis legal sales, really exciting but we expect it to grow substantially over the next couple of years. And we expect to see actually a $55.9 billion market by 2026. And want to take a look for a second where that’s coming from. And so if we move on to the next slide
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what we actually will begin to see is that the markets that are really leading the charge here, first stem from the unit
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the US market.
Looks like we’re having a little bit of technical difficulties here. But um, thanks, Jess. So that that US market if you look at this slide, that big black bar in the middle is the US adult use market. And so you can see over time, that is the that is the driving force of what’s expected to contribute the greatest contribution to growth over the next several years. That purple bar you see is actually the US medical market. And I think what’s interesting there is you can see that the see that the medical market continues to grow over maybe like the next couple years, so into 2022 2023, but actually begins to taper out as the US adult market becomes larger and more substantial. Another key thing I want to call out here is the interest international market, which is actually that, that that orange bar at the top. And this one’s really interesting because as we get more into this information, or as we as we built this international forecasting model, one key change that we saw from past forecast is that we’ve seen a little bit of a stalling of the progression of the markets in the European markets. And so where we’re actually expecting the biggest growth in the next two to three years, is with the Mexican market, which we are expecting sales in to start probably 2022 based on the rate at which things are coming to fruition.
And so with all this in mind by 2026, if we look at US markets, in particular, it looks like the top ones are we expect the top ones to be first to my California, which just for perspective is expected to be the biggest international individual market. In the entire world. I’m bigger than Canada on its own. But then in the US, followed by states like Colorado, Florida. And then I want to give a shout out to New York and New Jersey because obviously New Jersey just recently passed legislation, I think it’s been a hot topic the past week or so. And New York has been talking for some time that they’re going to move into the adult use segment. And so as those states come online, we assume that product will be available around 2022. And given the population of those states, and the income coming from those states, we do expect them to be major players. So they look into the future.
So we go to the next slide. Perfect. And so I talked a little bit about this as we’re going through some of those numbers, but want to call up a couple notable key updates, as we think about this forecast that was released this week, maybe versus some information that we were thinking about six months ago. And as we think about going forward. The first is that, you know, as we wrapped up 2021 key thing to call out is that the cannabis injured industry is extremely resilient to the pandemic. So as we were looking at 2020, about six or seven months ago, we were fairly conservative in the expectation of what the cannabis industry was going to look like.
And as it turns out, you know, some of the economic fallout never really happened. Our overall forecast has been updated, based on the fact that the that this industry has been extremely resilient to the pandemic. And consumers continue to purchase this product despite some of the challenges with COVID-19. Just to call out though our forecast has still remained within about 9% or so of actual sales. But then there’s a couple major changes that are market by market basis that we recommend really keeping an eye on over the next couple of months. The first is Arizona, I think Arizona is such a hot topic right now, because Arizona just legalized adult use voted to legalize adult use in November, and sales began in January. That means it is officially the fastest state to go from a medical market to the recreational market. And we anticipate as time goes on more states that are going through this transition that speediness will be faster and faster.
When we take a look at California, again, the biggest market that we’re looking at, we see that legal spending has increased 2020 was a breakthrough year for California. And part of that we take a look at there’s been expanded licensing and new local legislations that are expected to continue to drive that future growth.
Number 30. I want to call out, I’m using Pennsylvania as an example here. But we continue to expect that legalization will continue to happen at a faster and faster pace in the United States. And part of this is that pandemic related fiscal pressure is probably softening some of the anti labor legislation stance. Pennsylvania is a really great example of this, but it could have an impact and more states beyond Pennsylvania.
With all this in mind, I know especially in the current environment with the current administration, the question always comes up of when do we expect federal legalization. So BDSA predicts that federal legalization will happen in 2022. But we do not necessarily expect this to change the pace of individuals, state legalization, they’re still states on the books that say, even if federal legalization happens, they will not allow cannabis in their states. And then the flip side to that there’s a range of states who already have cannabis legalized, who want to keep it within their own system. So we do not expect that to change the forecast on numbers that we just provided.
And then I’ll wrap up really quickly on the section with just a couple notable forecasts on Canada. So Canada saw substantial growth coming out of 2020, and grew about 61% versus 2019, to a total size of over $2.6 billion.
And what’s really cool about this is it really was stemming from the adult use market, medical sales were essentially flat. And so where that growth came was from that adult use growing by about 86%. And a couple key notable things here. Again, we didn’t see much of a negative impact from COVID-19 measures, there was some short term or sporadic impact, but nothing substantial. A really substantial increase in the retail footprint, particularly in Ontario. And so that really helped accelerate growth, especially as we’ve closed out the year. And then finally, when we look at cannabis 2.0, that really was a bright shining star in 2020. That obviously, those products as they as they began to hit the market early last year, continue to grow. And so we continue to see that rapidly evolving, evolving category mix.
And so with that, I’m going to hand it over to Jessica to talk a little bit about some of the cool things we’ve seen in 2020. Hey, Kelly, sorry about the tech issues, my wifi internet kept kicking me off. So I’m glad at least you could still see my slides, I was a little concerned. So for the audience, apologies. We seemed a little off there, I was getting kicked off and I currently have control over the presentation. So Kelly, if for some reason something happens, you’re going to be back on presenting my slides for me. So again, thank you all for joining us. As Kelly mentioned, don’t forget to type in any questions you have into the question drop down within GoToWebinar, we will likely have a little bit of time to address those. So definitely feel free to populate those on. As Kelly mentioned, I’m going to focus on getting a quick recap of some key highlights trends market dynamics that we saw shift in 2020. And then we’ll cover off on our 2021 predictions. So let’s go ahead and dive right in. Many of you are likely used to seeing a slide that looks like this, if you’ve been on BDSA webinars, as Kelly mentioned earlier on in the presentation, we have the granular retail sales tracking data, we overlay that with an understanding of who are current cannabis consumers and who are non consumers. utilizing all that information, we then kind of create those market forecasts that Kelly just covered. So as we think about consumer and the consumer population, what you’re looking at here is amongst adults and fully legal US states. So really important to call out at this point, we’re at about 75% of adults. Again, in fully legal US markets who are open to or already consuming cannabis. This is a pretty big deal. And as you can see, I’ve also highlighted where we are in Canada at about 65% really big deal, especially as we think of other categories, whether that’s things like beverage, alcohol, more mature industries, they’re still a significant growth opportunity. Because as you can see here, while acceptance is around 75% current consumers are around 40%. So still an opportunity to continue to increase and grow. But really important to call it the sheer size of the interested population or the addressable market. Also, we often when we talk about the percent of the population consuming get a question from our clients or prospects around. Yeah, but how much do these people actually consume? How frequently are they consuming? Are these people who just tried once or twice in the past six months because they were at a friend’s house. By the way, that’s probably a bad example right now on COVID.
around other people have just tried once or twice when in actuality, if we were to just look at consumers who are consuming the high levels, we’re about 65% of inhalable consumers and fully legal US markets as well as in Canada, consuming inhalable at least daily. So when we kind of think about this, we have to think about not just the population consuming, but what are they consuming? And how frequently are they consuming. So just to break this down a little bit further and look year over year, really fun to take a look at where we are now versus where we were a year ago, full transparency and as Kelly mentioned, our consumer insights research covers total US by state, total Canada by province and then we break the us into a handful of different segments. So as you can see in this slide here, I’m really fun and exciting.
See some markets get really close to 50% of the adult population consuming. So you can see Colorado, even in mature markets growing year over year, the percent of the population consuming Colorado at almost 50%. We also have Oregon at almost 50%. So we have two legal mature markets that hopefully in our next round of research will be above that 50% threshold. Also important to think about this growth over time. So this research, we’ve been conducting every six months now, since 2017. So it is trending. And really interesting to look back over time and see that Colorado, for example, was only 24% of the adult population consuming if we’d go back to q1 2017. So really big jumps as we think about the evolution of markets. And as newer markets come online, it doesn’t take them the same timeline that it took Colorado to reach these numbers. You can see here, Massachusetts, if I threw Illinois up on this chart, you would see the same thing. We’re as newer markets open up, we see that percent of the population consuming start at a higher level than we did, let’s say in Colorado in 2014 through 2017.
Further, as we think about the types of products consumers are preferring and utilizing, especially in 2020, as you saw on the previous slides, consumer adoption definitely grew in 2020. And now consumers are consuming across more formats, and more frequently. So edible preference. That’s what we’re looking at right here is form factor preference. This is not dollar or unit share of volume, or sales. This is consumer preference, really important reminder to think about the different levers. And what we’re looking at as we go from market forecast to consumer shopper insights to retail sales, tracking, as you can see here, edible claim preference, really across markets is fairly similar. And this is definitely something that is growing over time. So with new consumers comes new use cases need states, acceptance of new and different forms. But important to call it here. Despite this growth and preference by certain formats. share in the marketplace has remained relatively stable across markets. Also, while this slide doesn’t show it, we always like to talk about cross consumption. So again, we’re looking at preference here on this slide. What format do people prefer but if we break this down, this does not mean they don’t consume other formats. So really important call out here is, for example, in fully legal states, of those consumers who prefer inhalable 65% of them also consume edibles, and 40% of those also consumed topicals. So as you think about need states and occasions of consumptions and kind of the benefits consumers are seeking, even if they prefer a single method, they’re also consuming across formats. So let’s go from the consumer side of things and that evolution that we saw in 2020, and look a little bit at some of the markets that PDSA tracks and kind of what did we see in the marketplace. So really quickly, what we’re looking at here is the eight US states that PDSA tracks, and their trends, sales lines,
month by month, and 2020. As you can see here, generally, sales trends and seasonality, mirror one another across the markets. Obviously in the yellow box, you can see we’ve highlighted the time period of kind of the COVID response. So what happened with shelter in place and stay at home orders. Obviously, I’m sure everybody on this call is coming from different states or provinces, all of us experience kind of different timelines, but definitely impacted the consistent trends we typically see in those months. But we definitely saw the seasonality trends kind of stabilize and come back to normal around June of this year. Interesting to call out here, again, General sales trends largely the same across markets, except for a few notable comments here, Nevada and Massachusetts, stricter regulations with COVID and March and April and May. Also worth calling out the yellow line here is Illinois. So Illinois, the most the newest on 2020 legal market, coming online in January. And so seeing continual growth of that market. So as markets initially Come on line, the trend lines look different than a more mature stable market. Also always interesting to think about Illinois, having only been legal for a year, it feels like quite some time. So going from total market sales trends, to category level, just showing you one example. This is California share by high order categories. Again, when we think about our retail sales tracking data, it goes from something like ingestibles and adjustables. To edibles and edibles to candy and candy to gummies and gummies to brand and brand to product and product a product attribute but keeping it at that higher level. Breaking down Colorado or sorry California dollar sales in 2020, quarter by quarter. You can see here, fairly similar trends. Nothing really shaking or moving that much on
Kind of consistency across the entire year, we did see growth of flower kind of coming out of and into COVID-19 and kind of the q2 time period. But again, worthwhile looking at this and understand that generally share has remained relatively stable.
This is obviously a stacked bar. So we’re not saying that the market hasn’t grown, we’re just saying, as the market has grown, the categories have generally grown at the same rate, at least at this highest level. So if we jump in a little bit further, I want to do a quick, some quick hits on specific categories and some brand moves and some product attribute trends that we saw take shape and 2020. Again, feel free to ask any questions you have as we’re going through this also, always worth reminding you, we will send out the recording and the deck so no need to take screenshots. So as we think about some quick hits, I’m calling out some specific subcategories and even on some specific brands, want to call out a few things. Let’s start first with inhale levels. So the first thing you can see here on the quick call that we want to make, which I’m sure everybody is probably tracking is this growth of live resin, specifically in vape. The magnitude of this growth is unique to California. And worth mentioning right now, pretty much driven by raw garden. So just again, worthwhile calling out some unique facts that we’re seeing and unique market dynamics. Also raw garden driving this trend, also raw garden, the number one brand in all of California across all categories. As of kind of in q4 2020. worth calling out despite this growth of live live resin. If we look at the marketplace of vape within California, distillate is still stronger. But again talking about growth here and kind of trends and dynamics. Also, I don’t have a call back here but just a few quick comments about the dabble concentrates market, definitely seeing rosin grow. California, Oregon and Colorado. rosin actually in California is up over 100% year over year. Live resin up 44%. Again, specifically talking about dabble concentrates. Another thing worth calling out as we think about the vape market, it is worth noting that some forms of concentrates performed better and smaller cartridge sizes. So when we look at this next point around larger cartridge sizes, winning what we saw in 2020 is one gram. And I know this chart is really small, but the green line is one gram and the blue line is 500 milligram cartridges in California, you can see where the one gram took over the 500 milligram. We’ve heard some people and some murmurings around this being driven by COVID. Stock ups coming in March, specifically because this takeover happened in the march April time period. But you can see here that that trend has been kind of evolving throughout 2019. So again, as we think about some formats of concentrates more craft or niche, we have heard some issues with those larger cartridge sizes. So while in general, we’re seeing this takeover, it depends on the type or the form of concentrate.
Alright, so next up on prerolls. It’s a hot topic and one that quite a few people on my team like to talk about all the time, just kind of this general growth and what’s happening as the market changes. So just between 2019 and towards the end of 2020. We saw 95 new infused pre roll brands into the market. And to be very clear, this was only looking at markets that had the same level of regulations in 2019 to 2020. So for example, Illinois is not part of this assessment. So again, 95 new infused pre roll brands, and worth calling out here some specific brand players, we have sublime number one brand within infused pre rolls, actually taking the number one and number two skews spots, obviously a California company. Interestingly also to call out Jeter did surpass supply in terms of sales in December specifically. So as we look to 2021, it’s going to be really interesting to continue to track who kind of who ends up in that number one spot. Also for pre rolls in general saw shift to smaller pre rolls, so a point five half grams instead of full grams. Also worth calling out 30% of the California pre roll market is now infused pre rolls. This compares to about 15% across other markets. So again, really interesting dynamics kind of coming to play as we think about California as a leading indicator market, and where do we anticipate other markets to either follow or show different trends over time. The last piece I’ll call out and you’re going to see it in a top brand ranking list. But as we think about inhalable is we cannot ignore the strength or dominance of MSL or vertical players in the marketplace. So these could be retailers selling their own, but also your MSO your large players so specifically this is relevant in flour. And you can see here when we look across
All of the BDSA tracked markets in q4 2020. Your top three brands, again, across all categories are MSO flower brands. So we have cresco cannabis, we have rhythm, which is GTI and you have verano. So again, kind of hard to discount or ignore the dominance of the MSO or vertical players as we think about the flower market. Alright, so let’s jump into a couple of quick hits on edibles specifically. The first point I want to make is really around edible preference growing. So I mentioned this earlier. So I’ll just kind of cover this really briefly. In California, for example, as I showed you earlier, there are more people consuming, so the consumer population is growing. A larger percent of those people are preferring edibles, and edibles consumers are consuming more frequently. So kind of as you think about that layering, really important to call out again, this is around consumption and preference, not necessarily sales. So always important to think about the categories that drive greater use, and even more frequent use than edibles. But really interesting to look at this evolution over time, especially as newer consumers enter the marketplace. The next thing I want to call out is a question for you all, you know, does brand dominance exist. And if we look at a single category, obviously, we could all say a very important category without edibles
of gummies. And we look just at California and Colorado, 2019 versus 2020. Wild is a great example of a brand that was not a California or Colorado, top five gummy brand in 2019. Now they’re number one in California and number two in Colorado, as of q4 2020. So again, just a really good question to ask ourselves, they’re definitely strong brand players and brand strength. But you have to ask the question, if if a brand didn’t exist in the prior year in the top five, and now they’re at the top of the list, what does that mean for brand dominance? Does it exist? And what does that mean in the short term and long term, but again, Wilds a great example of entering markets and really taking control and kind of showing strength and dominance. Alright, so the next one fast acting on a really hot topic and tracking some, you know, top brands entering this space I’ll call out one is specifically with their quick, fast acting products. What we’ve seen as we’ve broken these additional skews out, is really interesting that in our assessment, these really are incremental to a portfolio. So there’s nothing better than innovating and obviously innovating in an incremental way versus being cannibalistic off your own sales. As you think about fast acting on faster onset and even faster offset. I’m really thinking about different use cases and need states. When does that mean something? When does that have value to consumers? Why do they want something faster acting, so again, addressing a different need, a lot of consumers also telling us they’re very much influenced, kind of on their product choice set. Also, if we break down non consumers, and we look at our percent of the population who doesn’t currently consume but are open to it, we call those acceptors. About 10% of them say that they would be more willing to become a cannabis consumer, if they knew how long it would take to feel the effect. So again, as you think about product innovation, portfolio management, where do these things play? How does that drive either reaching a new consumer segment or a different needs state as assortment innovation product portfolio all comes into play. The last thing I’ll call out CBD
kind of lost a little bit of focus, I feel like for a while but it is still a thing and it’s very much growing and very much evident that consumers desire products with CBD. We see this across dispensaries across all the markets we track in 2020 to 20% of the edibles we track our products with or containing CBD in the US. Also you can see here we saw a growth of sales of CBD edibles year over year as well. So again, really important to call as CBD still very valuable. A lot of consumers seeking the benefits of CBD obviously to most of you not surprising. The last thing I’ll call out and Kelly’s probably going to hit on this when she covers 2021 predictions. But PDSA we are tracking secondary or other cannabinoids as well so THC CBD obviously dominant, but really tracking the growth, evolution and change in the marketplace. As more and more brands and products tout the benefits of things like CBN CBG THCA THCV. Again, these secondary cannabinoids, we really BDSA predicting to see quite a bit more growth and volume coming from products touting those benefits as well as we go throughout 2021 last quick hit um I brought this up at the last minute because I had a quick call with some of my team members across Colorado, Massachusetts as well as California today and wanted to call it this specific trend. We’re starting to see strain specific edibles. So we are tracking a growth in 2020 edible dollar sales coming from products
Specifically edible products touting specific strains. So just a couple of examples here. We have plus strains in California, we have Kiva loss farm. Interesting, obviously, Kiva loss, farm fruit, shoo, also live resin and strain specific. And then we have dialed in gummy as a newer player in Colorado, definitely leveraging strain specific flavor also rosin. So kind of think about strains like garlic cookies, wedding cake, Tropicana, cookies tropical, um, you name it, we’re tracking those strains specifically tied to dialed in gummies.
So with that, one last slide for you. But again, just wanted to cover some Quick Hits some interesting things we’re seeing that we’ve seen evolve in 2020. And kind of that’s going to nicely feed into our predictions for 2021. The last slide I want to show you before handing this back to Kelly is thinking about top brands across the US. So when we merge and look across the eight US states, specifically that we are tracking at BDSA, soon to be nine, we’re looking at the top brand performance and kind of where’s that coming from. And so a couple of quick call outs here, and many of you might have seen this, we posted this on LinkedIn a couple of weeks ago.
But as I mentioned earlier, top three cresco rhythm varano, strong, vertically integrated MSO players out of Illinois, so we cannot ignore that shear strength. Then you have raw garden, select Cz, raw garden and Cz, obviously great examples of kind of continued dominance coming from California specifically. And also as we break this down, and as we think about the evolution of the market, both by state but also by category. Worth noting here that six, the top six players here are inhalable brands. So, you know, while we continue to see this evolution in consumer behavior, adoption, and consumption within edibles, always important to remind ourselves that inhale was are still King. And flower, obviously, the flower market is not dying. There was a lot of conversations about that I would say about three years ago, but we continue to see the growth and dominance of that category. And so I’m actually going to bring Kelly back really quickly.
When we think about the predictions of kind of where we’re going in 2021,
Kelly will cover this, but just for ease, and you guys don’t worry about typing this in right now. But you’ll have the deck after to click the link, but you can download the full list of predictions for 2021. We don’t have enough time to go through what Kelly all 10. So Kelly’s picked her favorites. So Kelly, I’ll let you take it over from here. Perfect, thank you.
I would really quickly like to give credit to just for the awesome title on this slide deep thoughts from Kelly Nielsen. So super excited.
But when I was looking for predictions, and as you go to that link, and you have the ability to download, you’ll see there’s actually 10 of them. And I had a really hard time boiling it down. So I put it into a couple of buckets. But the first thing is I actually wanted to start was thinking about this idea of market expansion. Because that’s where we started this conversation, right, I gave that overview of understanding what’s going on in the market and where we expect it to go from here into, you know, the future and 2026. And so our first prediction is that there will be more than 3 million new users to purchase cannabis this year from us legal licensed retail stores. And I think this one’s really interesting to provide a little bit of background on how we came to this. And quite frankly, I actually think it’s a little bit conservative. But if we take a look at a market like Colorado, so just mentioned a little bit ago that when Colorado became a legalized state, we saw that about 24% of the population over the age of 21, had consumed cannabis. By November of this year, that percentage had reached out near 50% 48%. And so if you think about a state like Colorado, which has a population of roughly about 4.3 million people, that’s 1.1 million new consumers into this space. And that’s just one example. But as we’ve seen that the evolution of these markets, over time, more and more consumers become more and more accepting of this product and are more likely to try think about the states that are really early in their adoption curve. So if you think about states like Illinois, Massachusetts, Michigan, Maine, all of these early in their adoption curve and have a combined population of close to 24 25 million people. And so when you take that number, assume that we’re increasing the overall penetration of consumers. And then combine that with other evolving markets like Arizona again, Arizona, the fastest state to move from medical to recreational sales.
We think 3 million people is a conservative number but a really exciting one for the growth of this industry.
Second, I’m going to call it a bucket because it’s actually taking three or four different, different predictions of ours and lumping it into one. So in my prior lives, I spent the first 13 years of my career working in innovation consulting. And so anything pertaining to innovation is very near and dear to my heart. And so I think we would be remiss to talk about the growth of this category without talking about the role that innovation has in this. The first component to this that I want to call out is that we expect the continued rapid growth of these categories through new brands and new products, just to provide a little bit of perspective on just how many products we’re talking about coming into the market. If we look at California, versus the first nine months of 2020, licensed dispensary sold roughly 24,000 cannabis products, so individual products, compared to about 17,000, that same period, and 2019. Think about how many new products that is I’m trying to do math in my head, that’s 7000 new products over the course of that timeframe. And so that’s really exciting. And these were from a really wide range of brands, we saw the number of brands providing these products increased from a little over 820 19 to over 1000 in 2020. And so we expect the 10s of 1000s of new products will continue to influx, the overall category because again, that was just California.
The second piece to innovation is I believe, it’s going to continue to get more sophisticated and more targeted in nature. And so as we think about an innovation portfolio, there’s a time and a place for a bunch of different types of innovation, there’s the time and the place to have those big broadly appealing types of products. But there’s also the benefit of browning out your portfolio with more targeted types of products. And we know that the cannabis industry in particular, the reason people are purchasing is really dynamic, really multifaceted. And as the market continues to evolve, consumers are getting more educated on how different types of products are going to make them feel or where it fits in their lifestyle. And so over time, the more the most successful brands and organizations are going to understand the consumer understand what is driving the purchase decision, they’re going to build products that really meet those needs. And through very sophisticated and precise targeting, they will be able to identify and go after those consumers that are most likely to be purchasing those products. And I want to call out that from a targeting perspective, the most successful organizations, it’s not targeting or thinking about a segment strictly based on something like a demographic, you know, age, gender, etc. But really understanding the attitudes and how consumers think and so that’s one of the reasons why I brought up our segmentation at the beginning because our segmentation analysis is actually a built in attitudinal based analysis, because we know that consumers are purchasing different categories, opting into different types of products, because of their attitudes toward the cannabis industry.
And then the third piece of this innovation is that it’s going to create an influx of new products that really leverage both new technology and expanding that cannabinoid space. And so from a technology perspective, just actually touched on this earlier, but there’s the opportunity that technology and bringing technology to different categories can actually disrupt what we’re seeing from a share perspective across categories. And so for example, we, over time had heard one of the challenges with the edible space is you know, that that delayed onset and so fast acting and being able to kick in and have that onset faster, is a new consumer benefit. And it actually competes maybe more with some of the inhalable type products that are in the marketplace. And then when we think about those secondary cannabinoids, as Jeff mentioned, as Jessica mentioned, CBD is absolutely still a prominent player here, but it is paving the way for additional secondary cannabinoids like CBN CBG THCA, that consumers as they’re becoming more sophisticated as they’re beginning, beginning to understand what these different products can do for them. We expected that that market to continue to grow and we are also beginning to capture and track the these other secondary cannabinoids so that we have an understanding over time, how they continue to evolve in the marketplace.
And so that extra reps in my little section on innovation, I think the last thing I want to call out is that you know, as we continue to move through this, ecommerce is here to stay that if we look back this time last year pre COVID there was definitely not a huge chunk of volume that was moving through the e commerce space. We saw an uplift in that both through online website usage and then pick up and delivery services on
Which, obviously, like a lot of other industries spiked during the COVID timeframe, but they continue to stay. When we talked to consumers in q4 of this year 30%, more people than the prior year had said that they were using things like delivery services and websites. And so a lot of those barriers that maybe consumers hesitated on before, before the COVID pandemic timeframe, a lot of those have been broken down. And so we expect that to continue to be a major part of the way consumers are interacting and shopping in this space.
And so with that, I think we can maybe bring, bring Jessica back if there’s any questions that we have a few minutes to answer here. Thanks, Kelly. I was scrolling through these questions. There’s a lot here. One thing worth calling out, there’s a lot of questions around BDSA products and methodologies. So Kelly covered it briefly at the beginning the market forecast methodology, so definitely available in the recording. Also, as it pertains to consumer, as I mentioned, our consumer research is conducted every six months. It covers total US, US by state, by stage of legalization, and by region, and Canada by province, so a lot of granular drilling. And then when we think about retail sales tracking that’s actually tracking what is selling where, when, at what price point, as I mentioned, we’re in eight markets, we will be releasing Michigan next, somebody specifically asked a question about do we have Michigan. So that will be our next market very soon. So look out for an announcement there. But they’re not going to prep you for a second because the other exciting thing is the next couple months, we’re keeping a really close eye on Arizona. So Arizona is one of the markets that we cover today from a medical standpoint. And so in addition to launching Michigan, we will soon in the next couple months be able to break out recreational sales for Arizona, which is super exciting. Yes, good call out. So Arizona is one of the markets we already have tracked but being able to break it into two channels. So eight markets 13 technical markets, because we have to break medical and adult use in many of them. A couple of other questions, Kelly,
I’m gonna throw you on the spot. But I hope you have an answer for this one, given some of our conversations recently. Any thoughts on beverages where they are THC versus CBD? What do we expect to happen?
What share of the market do they currently have? And do we expect that to change in the near future?
Yeah, so I think beverages is a little is very much an interesting category that continues to grow. So right now edibles in the US makes up about 5% of total edible sales. So it is still a relatively small portion of total cannabis sales. But we’ve definitely seen some success over the past year or so there was really strong year over year growth, I’m blanking on the exact percentage, but very strong year over year growth. And I think that’s really a function of a couple things. The first of which is products that are launching that fit more closely with the traditional benefit of a beverage. So lower dosage, being able to have a beverage and enjoy a full container of product with friends in a social setting, for example. So I think that it’s a category that will absolutely continue to evolve. Yeah, and we’re actually and I know we won’t go into this in too deep in too much detail, but if anyone’s interesting, Kelly did host a webinar relatively recently, specifically on cannabinoid beverages both THC CBD and hemp derived CBD. I think that was in December, we had a few special guests from trust beverages in Canada on Lagunitas. And who am I missing? There was one other
completely space.
Why yes, yes. So we have that webinar recording if you guys are interested,
specifically in beverages. Um, one other question that I saw popping up which actually is a relevant topic as well as what about hemp derived CBD so FDA still hasn’t determined exactly are they’re regulating him CBD, again, in most cases sold outside of the dispensary. So mainstream Food, Drug mass convenience, e commerce, specialty food and natural grocers just to call it really quickly and then Kelly I’ll let you kind of cover this if you have any other thoughts. We Kelly showed you our regulated cannabis market forecasts. We do the same thing for CBD by channel so again dispensary is being a single channel grocery being a second channel and so on and by category for the US out through 2026 as well as the UK and Canada. So in addition to sizing the regulated cannabis market also constantly looking at hemp CBD as well. Also, for many of you, you probably know this we are strategic partners with IRI so IRI being a company that tracks mainstream channels, obviously most CPG companies working with an IRI. So again, we have access to hemp drive CBD products sales going through mainstream retail channels as well.
So Kelly not sure if you have anything to add there? No, I think that’s really the main thing are CBD forecasts which again total market view across all different channels including e commerce. By the way, we are able to provide perspective on what that total size of market looks like incorporating, you know, your grocery or mainstream retail medical dispensary, and e commerce was last updated q3 q4 last year, and it’s next on the docket for us to continue to reevaluate. Great. So as a quick reminder, because I’m seeing a lot of questions about specific states. So let me just run through this really quickly. BDSA market forecasts cover every single US state, every province and 30 countries globally. In the US by state and Canada by province, those forecasts are broken down to category level out through 2026. So you could say hey, I want to look at where BDSA anticipates the vape market specifically to be in California versus Missouri versus New York, versus British Columbia over the next five years. So really granular coverage of every single state, every province and by category. So just want to call that out. I’m seeing a lot of questions about Missouri and New York and New Jersey. So all of that is available. Obviously, when we talk about webinars, we don’t always go into all of those details. But just know if you have questions, feel free to reach out. You can see info at BDSA.com, great way to reach us. Obviously, if you’re an existing client, reach out to your account manager, if you’ve been in conversations with the PDSA sales team reach out to your sales rep. But with that, Kelly, any closing thoughts?
I don’t think so. Thank you all for the questions. And thanks for hanging with us for the for the past 45 minutes. And like just mentioned, if you have any other questions, we’d be happy to address. Oh, one more thing. We will be scheduling our next webinar. So it’s looking like we missed January. So apologies. But we did do three within like four weeks in December. So again, those are available to download on our website. As we go into March. We’re going to focus on seasonality, trends, holidays, what are the promotions that work that are most effective? will get ahead of for 20. And what will for 20 look like in year two of kind of COVID. So lots to come from us on that topic. But again, if you have any questions reach out otherwise we will talk to you guys soon. Thank you. Bye, guys.