The eventual possibility of selling cannabis is highly appealing to many convenience store retailers. With typical declines in tobacco sales, more fuel-efficient and electric cars impacting fuel volume, and the pandemic impacting foot traffic, this opportunity cannot come fast enough.
Currently, the sale of cannabis is fully legal in 17 states and Washington, D.C., and in another 32 states has been decriminalized, meaning there is no possibility of arrest for possessing a small amount of cannabis. Even better, the number of states that are loosening their cannabis laws keeps growing. But none of this matters as convenience retailers will not be able to sell cannabis until it becomes legal at the federal level.
There are encouraging signs that the current administration is interested in making this happen, but it’s unlikely to happen soon. So what is the convenience retailer to do?
Start With CBD
One opportunity is to position your outlet as a destination for currently legal cannabidiol (CBD) products produced from hemp.
Management Science Associates’ (MSA) research has shown that the cannabis consumer is very similar in profile to the CBD consumer, so building a presence among this target group now with CBD will likely yield stronger cannabis sales when the time comes.
Notably, the CBD/cannabis consumer is also very similar to the typical convenience store shopper — younger, male, and either in a blue-collar occupation or a student, making the task of appealing to this audience all that much easier.
It’s also interesting that the top reasons for using cannabis are very similar to the top reasons for using CBD — mostly for the release of pain, to help with stress and anxiety, and for relaxation.
Developing your location as a destination for CBD will keep this consumer coming back when cannabis is available for the very reasons they will be shopping your store today.
If you are wondering what type of CBD items to stock that may also appeal to the cannabis purchaser, note the graphic showing the preferred methods of consuming cannabis on the next page.
The good news here is that many of these product forms are also some of the more popular forms of CBD. Smoking cannabis is the preferred method of consumption (flower/bud and pre-roll), and one of the faster-growing CBD items in the convenience channel today is the rolled CBD cigarette. The top-selling CBD convenience item is the gummy, and this product form is also one of the top product types in the cannabis edible category.
Further support for building your CBD business today, in preparation for the legalization of cannabis, is that in those states where cannabis is fully legal, CBD usage levels are also stronger.
The stronger usage levels of both cannabis and CBD in states where cannabis is fully legal suggests convenience retailers that build a strong CBD business today will not only find that their CBD business expands, but that they already have the right consumer audience for significant cannabis sales when it does become legal at the federal level.
Don Burke is the senior vice president of Management Science Associates (MSA), a leading-edge data management and analytics firm. Burke has 20-plus years of CPG experience working across the cannabis, tobacco, grocery, confectionary and beverage categories. He can be reached at [email protected].