In the cannabis market, Flower continues to reign supreme as the dominant category in every market, though according to a recent Headset report, market share is declining in both the US and Canada. Be that as it may, cannabis flower is likely to hold its top spot as the consumer favorite for some time to come as the least processed and most versatile (albeit also the most susceptible to commoditization and price compression) of all categories. Headset’s report looks at changes in market share over time, segments, pricing, demographics, and other metrics of performance in the Flower category. Data was collected from real-time sales reporting by participating cannabis retailers via their point-of-sale systems.
Despite the fact that in Canada, flower market share declined from 78.8% to 42.5% with a less precipitous drop from 41% to 40.4% in the US, Flower’s popularity still trumps Pre-rolls (Canada) and Vape Pens (US), which are next highest-grossing categories in those countries. The market share decline has seen a commensurate drop in price, with the average EQ price falling by -22% in the US and -17% in Canada from January 2021 to March 2022.
The early days of the Covid-19 pandemic saw an early surge in Flower sales, but that trend reversed itself in early 2021, bringing market share to its current status at lower than pre-pandemic levels. In Canada, Ontario (home of densely-populated Toronto) sees a substantially larger proportion of total sales in the Flower category than other provinces, while in the US Maryland (47.5%) and Michigan (48.9%) hold down the higher end of market share. Last year this distinction went to Nevada at 56.3%, which has since fallen to 46%. Headset’s data shows that every market has declined in market share since last year.
EQ pricing for Flower in Canada dropped steadily throughout 2021, plunging by 17% from January 2021 to March 2022. In the US, that drop gained momentum starting in September, declining by -22% in the same period.
Male customers typically spend more of what’s in their wallet on flower than their female counterparts, with male Baby Boomers leading generational categories with a wallet share of 49.3% in Canada and 50.6% in the US. Gen Z holds the least wallet share, spending just a bit more than 1/3 of their total cannabis budget on flower as opposed to other products.
While Flower is in no danger of losing its ranking as the dominant product category for consumers in the US and Canada, the decline in popularity reflected in Headset’s data demands a response from cannabis companies to keep prices and demand steady. Finding creative ways to market toward women and less enthusiastic consumers in the Gen Z, Millennial, and Gen X generations while maintaining the loyalty and enthusiasm of its more robust male and Baby Boomer base may go a long way towards reversing the downward trend in Flower in the year to come.