Price Sensitivity Expected to Increase Among Cannabis Consumers

A new report from the cannabis data company Headset has suggested that cannabis consumers are going to become more sensitive to the prices of products in dispensaries. Much has been made of the cannabis luxury brands, but it seems customers are gravitating towards cheaper products.

That’s because millennials make up half of the cannabis market and they don’t have a lot of disposable income. This age group, which is between 23-38 account for 51% of the market. Their top preferred categories are flower, vape pens and concentrate in that respective order. They spend less than $25 per trip to the dispensary, with only Gen Z (23 and younger) as a more frugal group.

It’s thought that college debt and being new to the workforce means they have less money to spend on cannabis. While more established, older consumers can spend more. Gen X shoppers between the age of 39-54 spend on average about $28 per trip, while Baby Boomers between the age of 55-73 spend $30. The older generation, called the silent generation, which is over 74, is spending $33 per trip.

It would seem that cannabis companies would want to market towards the big spenders, but the Silent Generation is only .99% of the cannabis market. The boomers are 15%, while Gen X accounts for 25% of the shopper landscape.

The sweet spot looks like it is between $13 and $16. This is the average item price paid by cannabis consumers. The kids under 23 are at the bottom of list buying products priced at $13.63 (on average), while the older group over 74 spend the most as they are willing to shell out $16.97 per item (on average).

Women vs. Men

Headset believes there is an opportunity for marketing towards women. According to their 2019 data, older women in the Baby Boomer group make up 40% of the sales, while women under 23 account for 38% of the market. In 2017, a Statista survey only found that 7% of women smoked marijuana. Yet, it isn’t smoking that is drawing in female cannabis consumers, it is CBD and wellness products.

This explains why the top products for female shoppers are tinctures, topicals, and capsules, respectively. Flower and concentrates are the lowest-performing categories for women, making it the top form factors for men.

“The report said, “When it comes to trends in gender, it’s clear that wellness will be a big thing for anyone looking to bring more women into the market. While the cannabis industry has always overlapped with wellness, it is only recently being marketed specifically to that audience, and we suspect there’s room to grow there.” the report also noted that women spend 66% more of their cannabis wallet on CBD-containing cannabis products than men. “CBD products are absolutely considered part of the wellness side of cannabis, if not the central pillar of it. What’s more, the categories with the highest participation from women are those that tend to have more products containing CBD.”

 

 

 

 

Debra Borchardt

Debra BorchardtDebra Borchardt

Debra Borchardt is the CEO, Co-Founder, and Editor-In-Chief of GMR. She has covered the cannabis industry for several years at Forbes, Seeking Alpha and TheStreet. Prior to becoming a financial journalist, Debra was a Vice President at Bear Stearns where she held a Series 7 and Registered Investment Advisor license. Debra has a Masters degree in Business Journalism from New York University.


Leave a Reply

Your email address will not be published. Required fields are marked *

You may also like


About Us

The Green Market Report focuses on the financial news of the rapidly growing cannabis industry. Our target approach filters out the daily noise and does a deep dive into the financial, business and economic side of the cannabis industry. Our team is cultivating the industry’s critical news into one source and providing open source insights and data analysis


READ MORE



Recent Tweets

@GreenMarketRpt – 19 hours

$ACRG ⁦@AcreageCannabis⁩ Buys New Jersey’s Compassionate Care For Undisclosed Amount. Co trailed competition but ga…

@GreenMarketRpt – 20 hours

⁦@medmen⁩ $MMNFF $MMEN Faces Reality, Slashes Employees, Scales Back Expansion

Back to Top

You have Successfully Subscribed!