The marijuana market — both medicinal and recreational — will become a growth industry both in the U.S. and internationally, but those looking to capitalize on marketing in this burgeoning space will have to tread carefully.
According to Brightfield Group, a market research firm focused on the legal cannabis industry, the global cannabis market will reach $7.7 billion this year, but will grow to $31.4 billion by 2021, a 60% growth rate. While the U.S. and Canada (where the recreational market will open up next year) will account for the lion’s share of cannabis sales in 2021, more than a dozen countries (mostly in European markets) will have viable medical marijuana markets by then (and six will have viable recreational markets), according to the report.
“Marijuana [acceptance] is most definitely progressing in international markets, and will [mean] the biggest growth in the coming years,” Bethany Gomez, Brightfield’s director of research, tells Marketing Daily. “Globally, there is now more buy-in that marijuana has medicinal value.”
Increasing acceptance legalization could mean tax revenue gains, more jobs, and perhaps legalized cannabis imports and exports. But the path towards those ends will not likely be smooth.
“Legalization provides both mass tax benefits and business and employment opportunities,” Gomez says. “But the trend internationally and in the U.S. is one of increments. This is plant that has been demonized for some time.”
Indeed, the products that will see the greatest acceptance are those with low THC (the psychoactive component) and high cannabidiol (a.k.a CBD, which provides the medical benefits). Those products will likely fuel the growth, particularly internationally.
“There's a huge amount of potential for companies in the cannabis and hemp space,” Gomez says. “The market for non-psychoactive products is untapped.”
In the meantime, those looking to get into marijuana marketing will need to treat carefully. In the U.S., for instance, federal regulations prevent dispensaries in states with legal recreational use from having bank accounts, accept credit cards or engage in interstate business, Gomez says, and different government administrations can have different enforcement policies.
“Marketers need to be savvy about those regulations on a state-by-state basis, and they need to be creative in their approaches, because [marketing] is very restricted,” she says. “They need to be savvy about how they do what they do in the realm of the law.”