The legal pot business may be in its infancy, but it’s already created the marijuana equivalent of pre-grated cheese and instant noodles. Don’t feel like rolling a joint? Buy a pre-roll. Don’t want to smoke marijuana? Slurp it in a just-add-water soup mix, use a pod to brew it into a cup of coffee, or drop some salts into the bathtub and submerge yourself in it.
While marijuana buds, the quintessential vehicle for getting high, are still the most popular product, they are rapidly losing market share to the unprecedented array of pot categories that companies are turning up. Data from Washington state, one of four (plus the District of Columbia) that allow the sale of recreational marijuana, show how quickly the market is evolving. Flowers now account for less than 60% of sales, compared to 75% less than two years ago, according to market-research firm Headset, which says it tracks about 25% of all legal pot transactions in the state.
Meanwhile, sales of new products, such salves, under-the-tongue sprays, and highly potent waxes are blossoming.
If they continue to grow at their current pace, other products could soon top flowers. At least one industry insider, the CEO of a vapor pen company, is predicting concentrated forms of marijuana could make up more than half of marijuana consumption by next year.
This is because legalization has broadened the pot market to include people who have never smoked, and marijuana producers are catering specifically to them. Soccer moms want a form of pot that doesn’t stink up their cars. Athletes and older people want gels to rub on achy muscles and joints. Seasoned users want a more powerful high. “The marketplace is so competitive that people really need to hone in on what they’re doing,” says Olivia Mannix, who runs Denver-based Cannabrand, a marketing firm specializing in marijuana.
And then there are the regular smokers who are just, well, so tired of rolling joints. “Pre-rolls rock,” says Shea Hynes, product buyer at Stash Pot Shop in Seattle. “Everybody loves smoking a joint, but everybody hates rolling a joint.”
This is good news for the marijuana industry. The profit margins for more processed products are higher than for plain flowers, according to Headset data; in fact, by the standards of any industry, they’re very good indeed:
|Tincture & sublingual||56.4%|
And there’s one more upside for the industry: all these forms of marijuana hide the product itself from inspection. It’s a lot easier for an exacting customer to spot sub-par buds when they’re sitting in a glass jar than when they’ve been mulched up into a cookie or even hidden behind the paper of a pre-rolled joint.