As the smoke clears from April and we start to see a phased reopening of America state by state, it looks like last month will be the most complete set of data to see how the cannabis industry was impacted by the prolonged lockdown.
While we imagine people will be diving into those consumer trends for some time, we wanted to find out early what the experts see in the numbers. We spoke with some of the companies that have the biggest datasets both in and on the pot industry. From their perspective, there was plenty to take away from consumer data in April. While the cannabis industry has had its ups and downs since seeing an early run on product in March, April lived up to some of the hype.
April did not have as strong a growth rate as seen in recent years; Headset said in April that California’s Adult-Use marketplace saw $300 million in sales. That was up over $90 million from 2019, and three times what the industry did in 2018, when Proposition 64 had just been implemented. People still had a certain ease of access to cannabis outside of the legal market that early in the game, but it’s not nearly as prevalent as before. That being said, there are still plenty of people you can buy pot from.
LeafLink, a business-to-business e-commerce wholesale marketplace that connects retailers and brands, said that while overall sales on their site grew by 10.63 percent month-over-month during April 2019, sales decreased by 4.02 percent month-over-month during April 2020.
“This was largely due to the impact that COVID-19 stockups had on typical 4.20/April wholesale ordering patterns. During the week of 3/16, we saw a major stockup event, and sales increased by 36.42 percent compared to an average week-over-week growth rate of 2.9 percent during the months prior,” LeafLink told L.A. Weekly.
However, during April 2020 average order volume increased by 6.25 percent month-over-month, compared to a 4.76 percent increase during April 2019. So dispensaries were ordering more when they did eventually stocked up.
The country’s biggest weed technology company also had plenty of insight for the month of April. Since Weedmaps added delivery in recent years, it has an even better view of the situation compared to when consumers were just using the site to track down their prized 4/20 nugs.
April 2020 was Weedmaps’ busiest month recorded since the company’s founding in 2008, with a 457 percent increase in orders processed on the Weedmaps platform compared to April 2019. This year’s 4/20 was Weedmaps’ highest single-day volume in the company’s history.
“The orders processed on Weedmaps on 4/20/20 reflected a 434 percent increase on orders recorded on 4/20/19, which was the busiest day on record for 2019,” Weedmaps told us.
Weedmaps also had over 260,000 consumers tuned into the livestream to celebrate the holiday.
“The virtual event also allowed us to shine a light on one of our advocacy partners, Last Prisoner Project, and the contributions they’re making to the broader cannabis industry. As such, funds raised through the livestream went toward protecting incarcerated communities during the coronavirus pandemic,” they said.
Weedmaps pointed to four main factors driving demand through the pandemic — besides weed being the most popular drug on earth. First was, as individuals spend more time at home, they have more opportunities to consume cannabis, and that is translating into higher sales. Another thing driving demand is the large orders placed seem to be a result of people stocking up to avoid additional exposure as the prospect of an extended lockdown period looms. Third, it’s not just the stress of running out of weed: As many consumers feel uneasy or anxious about the current pandemic situation they’re turning to cannabis for it’s relaxing properties
Finally, and arguably the most important issue driving demand according to Weedmaps, is that there are many who depend on cannabis for their medicinal needs, so much like one would go to their pharmacy to stock up on their prescriptions, those consumers are taking the necessary steps to ensure access to their cannabis medicine. While one of the smaller segments of sales these days since most don’t need a doctor’s recommendation to access medical cannabis, the patient community helped build most of the companies that survived the jump into legalization.
But what were people buying? Well, edibles are certainly proving to be more popular than ever since everyone is stuck at home with their kids. Before coronavirus, edibles made up about 12 percent of all the things being ordered on Weedmaps. These days they make up nearly a quarter of everything sold at 22 percent.
The biggest edible shift happened in people under 35. Edibles were already popular with older consumers. The brands that have proved to be the biggest winners in this run on edibles are Kiva, Kanha and Smokiez.
Besides having your kids all the time, Weedmaps said another reasonable hypothesis for the run on edibles is for this that there may be some hesitation to consume flower given that COVID-19 is a respiratory illness.
New Frontier Data told L.A. Weekly its data showed April spending was up 38 percent from last year across the 27 legal cannabis markets. The Northeast saw the biggest bump this year as the newer markets there continue to gain footing.
But regardless of the actual sales numbers, and even with cannabis retailers being deemed essential in almost all markets, consumer shopping habits have changed significantly. A recent survey of cannabis consumers by New Frontier at the end of March found that more than half had stockpiled more than a two weeks supply of products.
“The stockpiling in late March, and higher spending through April, suggest that consumers are making less frequent trips to dispensaries, but purchasing more on each trip,” New Frontier said. “Nationally, looking across all markets, flower sales were up 11 percent, accounting for 43 percent of sales. Edibles which accounted for 12 percent of the share, were up 17 percent, the highest increase of any product category.”
We asked the National Cannabis Industry Association their thoughts on the data, and how the industry generally fared in April.
“One positive is that there has been something of a leveling of the field, where things like delivery, curbside pickup and online transactions that have been unfairly withheld from some cannabis businesses are now being allowed to varying degrees,” NCIA media director Morgan Fox told L.A. Weekly.
Fox said NCIA was also seeing some improvements related to medical cannabis, like allowing telemedicine recommendations and honoring cards that have expired within a set period of time.
“Hopefully these allowances will continue post-COVID as officials and regulators realize that the cannabis industry is perfectly capable of operating safely and effectively under the new conditions,” he said. “Overall though, I’m very concerned that the strains created by the coronavirus are mounting and will continue to hurt cannabis businesses despite them being permitted to continue operations.
Fox said that’s why we are seeing mounting pressure from lawmakers and advocates to provide federal relief to the industry and the ancillary businesses that work with it.