420 has come and brought in over $178 million in regulated revenue across the nation and generated the highest single-day sales in cannabis history. The sales data is now a case study for where the consumer’s priorities are and how the industry can step up to meet those needs.
On 420 2023, we saw the following categorical spend breakouts across all regulated purchases (inclusive of medical and recreational sales):
- Flower – 49.1%
- Vape – 31.1%
- Concentrates – 11.2%
- Infused Edibles – 7.0%
- Infused Non-Edible – 0.6%
- Non-Medicated – 1.0%
Naturally, flower will rise to the top. The only anticipated anomaly for the flower category will be on 710, the day dedicated to all things extracts. For 710, we anticipate that vape will come out on top by a slim margin, but frankly- it’s hard to beat the power of flower. Here we’re going to go category by category and discuss what this means for producers and purchasing managers.
Flower
Flower will never go away- wine is to the alcohol industry as flower is to the cannabis industry. Some markets, though, are experiencing some flower fallout as cultivators rise and fall. Across the board, dispensaries and consumers need multiple flower tiers with strain and terpene varieties. There is absolutely a need for the mid-tier, budget-conscious flower as well as the high-end, heavy terpene, hand-trimmed top-shelf flower. The key here is balance across the tiers- being able to provide popcorn quarter-ounce bags for the customers ballin on a budget as well as the splurge flower gives options and variety. Aside from actual price point and quality diversity, strain and terpene variety matters. Some markets don’t require labeling or disclosing the exact terpene quantities in each strain, but purchasing managers and cultivators absolutely see these numbers in the testing information. Aside from a mix of indica, sativa, and hybrid strains, look for flower high in myrcene and linalool or indica for calming effects and limonene or pinene for uplifting effects. Never sleep on the testing.
Vape
The vape category comes in at nearly a third of all 420 purchased products- including disposable pens and cartridges. Vape has had a rocky start in cannabis with the infamous ‘vapegate’ and negative discourse stemming from unregulated market issues. However, vape products purchased within the regulated market have grown exponentially into a retail staple.
On the cultivation and production end, vape can be an extension of signature strains or an interesting R&D area to test with terpene flavor profiles. Cultivators can infuse botanically derived terpenes into oil extracts for flavor and potency effect or even utilize in-house cannabis derived terpenes. Developing complex flavors paired with high quality equipment that doesn’t fail is the key to success in vape. Cartridges and disposables can fail; Selling a failed product is an easy way to lose a customer. Efforting in quality control and ensuring the vape product works and works well earns longtime customers.
Purchasing managers should be looking at vape with high myrcene or limonene for palatable flavor profiles- high terpinolene vape is an acquired taste to say the least. Similarly to flower, vape tiers should be available across the gamut for customers to choose from. Some customers will need a vape to consume discreetly and some want to experience the flavor profile of a high-end vape. A mix of disposables to go as well as savory cartridges for seasoned cannabis connoisseurs, will cover all bases.
For bonus points, purchasing managers must offer both low-tier and high-end vape accessories. While accessories only make up a small sliver of sales, they do support the second-highest category in cannabis spend. A cheap, under $10 510 battery for cartridges and a high-end premium battery like a Vessel device serve as an incredible upsell and long-lasting vape accessory.
Concentrates
Dabs are more than a silly little outdated dance- it’s the advanced move for cannabis consumers and has been on the rise. Down at 11.2% of all 420 sales, concentrates may seem like an area to put on the back burner for production and for purchasing managers.
For production, concentrates can be expensive to produce with a limited yield. It can also be costly as some areas require the flower used to go through testing as well as the finished product, effectively costing twice as much to test when compared to flower. Producing BHO can be the most cost-effective way to produce extracts and there is a huge place for BHO in the market- it again speaks to the consumer that’s ballin on a budget or perhaps needs a small amount of concentrate on top of a bowl to amplify the effects of consumption. There is a market for solventless rosin and other carefully crafted concentrates. Here the process can be more important than the strain(s) used- die-hard concentrate consumers are looking for expertly pressed product without additives.
On the purchasing manager’s end, that means again purchasing different tier levels of concentrates, knowing that there should be some variety in the production method. A handful of BHO concentrates in at least a wax and shatter variety as well as a few select SKUs of solventless rosin, w will cover consumer needs. Concentrates shouldn’t be purchased in the same volume as vape or flower, but e variety is necessary to appease the dabbers. Additionally, to this point, for accessories, it may be nice to have a small number of huni badgers or a dr. dabber on the shelves. They won’t move fast, but it will posture your accessory department as an authority for concentrate consumption.
Infused Edibles
Edibles have plummeted to 7% of all purchases on 420 when, ironically, edibles have been a classic consumption method for decades. However, edibles in the regulated market haven’t had the cultural chokehold we may have anticipated. Producers can jam out edibles with relatively lower effort (especially when compared to our example of solventless rosin) and there is some room to be creative. At this point, the market is relatively flooded with chocolate and gummies. If a producer has a licensing deal with large MSO brands like Incredibles or Cheeba Chews it brings along a built-in audience. Newly launched chocolate or gummies can be hard to take off. For producers who are looking to add an edible SKU to their lineup, they must identify an underserved area and work towards appeasing that area. Moon Picks, for example, focus on CBD-infused toothpicks but have also released THC-infused toothpicks in regulated markets. Hot Lips hot sauce in California has created flavors of infused hot sauce in a highly saturated gummy market. Creativity will create positive PR and support the launch and longevity of your new edible.
The same core thinking applies to purchasing managers- the market is still flooded with the same chocolates and gummies, so look for the outliers. It may be more viable to have slightly more gummies between chocolate and gummies as they are less likely to melt or distort for the customer. There’s no bigger bummer than buying an infused chocolate bar only to get home to soupy, infused, mushy melted chocolate wrapped in child-proof packaging.
Infused Non-Edible
We have infused inedible products at less than a full percentage point of the total products sold this year. This is predominantly consisting of topical products like infused lotions and bath bombs. Frankly, this tiny sliver of SKUs sold needs to have some presence but certainly does not need to be a major focus of production or purchasing.
There will be those (like athletes or older folks) who love a topical balm, lotion, or bath bomb. This group tends to be quite brand loyal to their topical products, so they are great to cater to, however, topicals are rarely an add-on to a flower or concentrate customer’s cart. For producers, a topical can be somewhat lucrative, but if there is already a dominant force in the local market like Mary’s Medicinals or Apothecanna it may not be viable to launch a dedicated topical SKU. Producers who can obtain licensing to manufacture trusted brands may find success, but otherwise, the juice is simply not worth the squeeze. Similar schools of thought apply to purchasing managers- you do not need multiple lotions or balms in your inventory. The only topical area that may require some variation (aside from potency) would be bath bombs for fragrance. Across the board, for topicals, keep it light- don’t slather it on.
Non-Medicated
Accessories are a necessity to cannabis consumption and frankly, just a fun place to partake in the culture. On the brand end, considering accessories as a gift with purchase or giveaway item can help expand your brand’s footprint but aren’t a particularly viable area to place focus. For purchasing managers, accessories can be a fun break from balancing product orders. A healthy glass section presents your retail location as a professional one-stop shop. Look into local wholesale glass retailers to avoid any online ordering issues. If you’re struggling to find a reliable glass or accessory partner, it may be a good excuse to attend the next local Champs trade show to make some solid connections.
420 broke records and will continue to year over year. Data-driven decisions will help you continue to see historically high sales year over year, whether you’re a producer or a purchaser. This analysis and insight is part of what MJ Platform has provided the cannabis industry since 2010 and will continue to year over year. MJ Platform invented Seed-to-Sale tracking and has launched countless staple cannabis operations across the nation, and we can help you improve how you do business too. Our business optimization software system keeps you compliant and delivers data to empower decisions. For a free live demo with one of our seasoned cannabis experts, click here to book a demo. You’ll need it before the next 420.
