US Cannabis Consumers Prefer High Potency Premium Products, Rosin And Infused Pre-Rolls
The U.S. legal cannabis market has witnessed significant shifts in 2023. Factors like potency, taste and premium packaging are now driving consumer choices, with a particular preference for the nuanced flavors of solventless products like live rosin, explains BDSA analyst Brendan Mitchel-Chesebro.
He notes a decrease in the cannabis extracts segment to just 6% of total cannabis sales, down from over 10% previously. Meanwhile, solventless product sales within this category rose from 14% in Q2 2022 to 18% in Q3 2023, with rosin dominating 84% of this segment.
Infused Pre-Rolls And Pricing Trends
Infused pre-rolls have seen a 63% increase in average retail price compared to non-infused ones, reflecting the added value and costs of concentrates.
Despite industry-wide price compression, infused pre-rolls maintain their premium pricing, indicating a market trend towards high-quality, specialized products.
Key Market Segments: Vapes and Edibles
The disposable vapes category experienced a 50% increase in market share from Q3 2022 to Q3 2023.
Specifically, rosin disposables grew by 86% and live resin disposables, by 24%. Rosin disposables are priced 25% higher on average than the overall disposables category, signaling a shift towards premium offerings as well.
Demand For Minor Cannabis Cannabinoid-Infused Edibles
Minor cannabis cannabinoids such as CBN and CBG are gaining traction in the edibles market. These products command higher prices than THC or CBD-only edibles due to their consistent, targeted effects like aiding sleep or pain relief. BDSA predicts continued growth and innovation, particularly in the hemp-derived cannabinoid market, in 2024.
Demographics And Customer Segments
Younger demographics, notably Gen Z and millennials, show different consumption patterns, favoring high-potency and premium products.
They are more likely to consume products like infused pre-rolls and solventless extracts, with 58% of younger consumers reporting infused cannabis pre-roll usage. However, they are also more price-sensitive compared to the general consumer base.
Strategic Considerations For Cannabis Companies: Pricing Strategy And Market Positioning
- Mitchel-Chesebro highlights the need for a comprehensive pricing strategy and competitive analysis for success in the premium cannabis market
- Local brands with established consumer bases are well-positioned to capitalize on premiumization opportunities
- He underscores the importance of comparative pricing analysis and marketing to attract the right consumer segments, especially in a market with increasing brand loyalty and recognition.