Prohibition Partners Releases Disrupting Drinks

15.06.2020

Leading cannabis market intelligence and strategic consultancy firm Prohibition Partners has launched Disrupting Drinks. The report is the first in our series of in-depth consumer research reports, offering a comprehensive deep dive into the emerging cannabis drinks market, supporting businesses, investors and regulators in one of the most exciting sectors in the industry.

Industry-leading data and intelligence firm Prohibition Partners, polled over 15,000 adults across North America, Europe and on their usage, purchase and attitudes towards cannabinoid-based products and has released new research indicating that all segments of the drinks industry are now embracing cannabis-infused drinks, and there is also a clear potential for a growing consumer base as 16% of people have not yet consumed cannabis-infused drinks but are keen to try them and say they will probably do so within the next 12 months.

Cannabis-infused beverages are recognised for relaxation, reducing anxiety and promoting calm-  characteristics much sought after at a time of unprecedented upheaval and uncertainty.

“We are on the cusp of a drinks revolution, for centuries, legal socialising has either involved alcohol, or sobriety; outside of caffeine and nicotine, ultimately you either consumed alcohol in varying qualities, or you didn’t. Cannabis infusions bring a third choice to leisure consumerism, and consumer research from Prohibition Partners finds that it’s a choice a lot of people plan to make. With global consumers now embracing health focused alternatives, the emerging cannabis drinks market is one of the most exciting sectors within the drinks industry; cannabis infusion will truly disrupt the drinks market and become a highly lucrative source of revenue for those companies ready to embrace it and a new source of social stimulation for consumers around the world.”

Stephen Murphy, Co-Founder & Managing Director – Prohibition Partners

Disrupting Drinks : Buy Now

  • Prohibition Partners estimates the global cannabis drinks market will be worth US$1.82 billion by the end of 2020, growing to US$5.8 billion by 2024.
  • Findings from Prohibition Partners’ Disrupting Drinks’ report, published today find cannabis is growing in every segment of the drinks industry; from alcoholic drinks to energy drinks, wellness to soda, fruit juice to coffees and tea.
  • Consumer demand is strong; the report finds that one in four consumers or would-be consumers of other cannabinoid-based products would be willing to try cannabis-infused drinks, and 28% of people who have already tried infused beverage consumers say they intend to buy more infused consumer goods in the coming three months.
  • The current stressors of 2020 have already proven to be a boost to cannabis-based products. Despite the current inevitable economic downturn, cannabis is still set to record impressive growth as consumers look for products to help them relax and de-stress and as the most popular format, drinks will likely be the greatest beneficiary.
  • How cannabis is disrupting drinks globally, is set to be discussed at the new online global event Prohibition Partners LIVE – set to run in place of the annual Cannabis Europa conference usually held at the Southbank in London, Cannabis Europa on 22nd-23rd June.

The drinks are made up of two distinct subsets:

  • In countries where CBD is legal, including the UK, cannabis can be infused into both alcoholic and non-alcoholic drinks, and will be consumed to relieve stress and decrease anxiety. Indeed brands such as Vita Coco and Lagunitas have already launched CBD offerings.
  • In countries where THC is legal (including the US, Canada, the Netherlands), brands are beginning to produce non-alcoholic THC drinks that have often been designed to visually and gustatorily mimic alcoholic drinks – so they may look or taste like beer, or gin, or wine, mirroring the more traditional effects of cannabis.

The lipstick effect

The lipstick effect is the theory that when facing an economic crisis consumers will be more willing to buy less costly luxury goods. The underlying assumption is that consumers will buy luxury goods even if there is a crisis, but that these goods will be more budget-conscious than luxury. Cannabis infused drinks is an ideal example of this and Prohibition Partners has found that cannabis products are expected to benefit from the period of self-isolation, which is causing consumers to stockpile cannabis products especially as part of the ‘home entertainment line-up’ in regions where people watch  more television and spend more on ancillaries that facilitate in-home leisure, in-home socialising and the trend towards the ‘big night in’.

Can cannabis infuse growth in a stagnant market?

Claire Birks, Prohibition Partners Senior Analyst says “The global drinks market may be large but overall industry growth is slow with some analysts forecasting  annual growth at around just 3%. Our research has found that cannabis-drinks, however, are poised for much bigger growth and point towards an almost 45% compound annual growth rate for the cannabis-infused segment of the drinks industry.”

This already growing industry has been further driven by COVID-19 shining a spotlight on respiratory illness and lung disease in an unprecedented way and having a knock-on effect on how people choose to consume cannabis. People are avoiding smoking and vaping in favour of other formats such as edibles, including drinks. Furthermore, governments throughout the globe will be searching for ways to bolster flagging economies and cannabis-infused beverages have the potential to deliver.

Interestingly working parents were particularly responsive; 2020 has seen them take on the roles of worker, teacher and parent all at once – their wish to reduce stress is evidenced by the fact that almost 70% of people who reported that they are likely to buy more infused products in the coming three months, have children under the age of 18 in the household. This indicates that parents may need an outlet to provide a form of escapism or herbal self-medication during the crisis. This is likely to also be a key reason that more than half of those who intend to purchase more cannabis-infused drinks in the coming three months are aged 25–44.

Is trouble brewing for alcoholic drinks?

Federal US Government Statistics from April show a rise in stress-drinking directly resulting from the global pandemic and this has been mirrored across much of the world. Furthermore, a leading professor of Health at the University of Boston has warned that a spike in alcohol use disorders is on its way owing to a shift in alcohol purchase and consumption habits during the crisis.

The emerging cannabis drinks segment, however, is poised to become a silver lining. Once a prohibition bedfellow with alcohol, it could offer a possible alternative to alcoholic drinks and therefore help to offset an impending overuse of alcohol – offering a real alternative for people who want the benefits of immediate stress reduction that alcohol can bring, without some of the unpleasant or damaging effects. Consumer research conducted by Prohibition Partners has found that four in ten consumers who have or intend to purchase cannabinoid-infused beverages do so as a replacement for other intoxicating substances. Therefore, although cannabis-based drinks represent a credible challenge to the alcoholic drinks industry, the positive impact they could have on reducing alcohol abuse could be more important with a further reaching global impact.

Can cannabis be the silver lining?

Of course, even amongst those who would substitute other intoxicating substances for cannabis-based drinks, it is unlikely that they will replace them altogether – and on a wider scale the expectation is that cannabis-infused beverages will find a place alongside, not instead of alcoholic ones.

The alcoholic drinks industry has a head-start to the tune of almost 100 years on cannabis drinks, which means that alcohol’s journey to ubiquity could light the way for the cannabis drinks segment. Premium offerings from long-established brands will help to distance cannabis-based drinks from the negative associations with cannabis. Establishing associations with key drinking events such as sports, and celebrations such as Thanksgiving and Christmas will also be key to ensuring that cannabis-drinks avoid becoming just another ingredient trend.

About Prohibition Partners

Prohibition Partners unlocks the potential of cannabis through data, intelligence and strategy, enabling its clients to make better business decisions that deliver transformational growth and disrupt mainstream verticals. Prohibition Partners works with the industry’s most influential stakeholders, some of the world’s best known brands and an unrivalled network of analysts, innovators and advisors.

Prohibition Partners LIVE is a new virtual conference created by the producers’ phenomenally successful conference ‘Cannabis Europa’ held yearly at the Southbank Centre. The event was created in response to the current lockdown – shifting from the physical ‘Cannabis Europa’ to become Prohibition Partners Live – a new single digital platform, combining Cannabis Europa with four other global events; all run by Prohibition Partners. The event will feature live-streamed keynotes and panel talks from CEOs, policymakers and cultural leaders across five virtual stages. Providing thought-leading content, high-quality networking, and using the very latest technology to ensure that delegates are guaranteed engaging experiences, entertainment and full networking opportunities and moving as far away from the traditional static webinar format as possible to give delegates as close an experience to a live event as possible.

Prohibition Partners Releases Disrupting Drinks

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