What Are Cannabis Beverages?
Cannabis beverages, often referred to as cannabis-infused drinks, are products containing cannabinoids like THC or CBD, which are designed to be consumed as liquids. These beverages include a variety of options, such as THC-infused sodas, CBD teas, and non-alcoholic cannabis beers. For consumers, they offer a smoke-free way to experience the effects of cannabis, appealing to those seeking a discreet and health-conscious consumption method.
Overall Popularity and Growth
Beverages infused with cannabis have become a significant trend within the cannabis market. The growing availability of cannabis-infused drinks has been supported by the increasing number of legal states, allowing more consumers to explore these products. As new states adopt cannabis-friendly legislation, the market continues to expand, providing opportunities for dispensaries to introduce beverages as a unique product offering.
The cannabis-infused beverages market is projected to grow at a compound annual growth rate (CAGR) of 17.00% over the next decade. The market size is anticipated to increase from US$1,227.3 million in 2023 to US$5,899.5 million by 2033.
Cannabis beverages represent a small portion of the total cannabis market, accounting for a mere 1% of all retail sales in Q2 2024. Despite this small portion of the market share, cannabis-infused drinks made up 6% of edible sales in Q2 2024, making it the fourth largest edible category. Cannabis-infused drinks make up 70% of overall cannabis beverage sales, with shots at 12%, powder mixes at 10%, and all other beverages at 7%. Interestingly, the sale of shots has almost doubled from Q2 2023 to Q2 2024.
Demographics: Who Are the Main Consumers?
Cannabis-infused beverages are very popular among younger adults. Millennials and Gen Z consumers are leading the trend, drawn to the lower-calorie alternative to alcohol and the ability to consume cannabis in a familiar format like a seltzer or tonic. Additionally, the smoke-free nature of these products appeals to older adults, who often seek cannabis for relaxation or medicinal purposes without the respiratory concerns associated with smoking or vaping.
Why Do People Choose Cannabis-Infused Drinks Over Other Consumption Methods?
Consumers often choose drinks infused with cannabis over other consumption methods because they offer a discreet and health-conscious experience. The effects of THC or CBD beverages tend to kick in within 15-30 minutes, which is faster than most edibles, providing a more controlled experience that appeals to those seeking a balanced high. Many also appreciate the ability to consume cannabis in a social setting, similar to alcohol but without a hangover, making these beverages a popular choice at gatherings and events.
Comparing Infused Beverages to Other Consumption Methods
Cannabis beverages offer a distinct experience compared to more traditional methods like smoking, vaping, or edibles. While they may come at a higher price point per dose, the value is seen in their convenience, flavor variety, and appeal to those prioritizing wellness and social experiences. This has positioned cannabis-infused beverages as a premium category in many dispensaries, providing a differentiated product for consumers seeking something new.
Cannabis-Infused Drinks and the Future of the Alcohol Industry
Cannabis-infused beverages are increasingly viewed as alternatives to alcohol, particularly among younger consumers seeking a healthier lifestyle. This trend opens new opportunities for dispensaries to capture the attention of consumers looking for social options without the downsides of traditional alcohol consumption.
What Are the Margins and Revenue Opportunities for Cannabis-Infused Beverages?
Beverages containing cannabis present dispensaries with strong revenue potential due to their relatively high margins of 10-20%. For dispensaries looking to attract new consumers or offer more diverse products, cannabis-infused drinks can serve as a compelling addition to their inventory. Expanding distribution channels, such as online sales and delivery services in states like California, have made these beverages more accessible to consumers, further boosting their popularity.
As more states adopt cannabis delivery and curbside pickup options, the potential for reaching a broader consumer base with cannabis-infused beverages grows, allowing dispensaries to capitalize on this evolving market.
Expected Growth and Popularity into 2025 and Beyond
The cannabis market is growing and shows no signs of slowing down. In the U.S., further expansion is expected as more states legalize recreational cannabis and as consumer interest shifts towards healthier consumption methods. Projections suggest a steady growth rate of around 18% annually, with the potential for even higher growth in states where cannabis-infused beverages are newly introduced.
For dispensaries, investing in cannabis-infused beverages is a strategic choice for 2025. Stocking a range of options, from low-dose CBD drinks to THC-infused sodas, can attract diverse customer segments and help dispensaries stand out in a competitive market. Additionally, keeping up with seasonal trends and innovations in flavors and formulations can ensure a dispensary's offerings remain fresh and appealing to customers.
Top Trends in the Cannabis Beverage Market for 2025
As the market evolves, several trends are emerging that make this an exciting new opportunity for dispensaries across the country. Here are some of the key trends to watch for in the coming new year:
1. Low-Dose and Microdosing Beverages: The demand for low-dose THC beverages is on the rise, appealing to consumers who prefer a mild effect.
2. Functional Ingredients: Products infused with adaptogens (help the body manage stress and return to homeostasis) or nootropics (brain boosters) are gaining popularity, targeting health-conscious consumers looking for wellness benefits beyond cannabis.
3. Seasonal Offerings: Limited-edition seasonal flavors can create urgency and excitement among consumers, encouraging purchases during holidays or special occasions.
Challenges in the Cannabis Beverage Market
Though the cannabis beverage market is growing, there are still challenges that dispensaries will face in getting this product to their core consumers. Varying state regulations regarding dosage limits and labeling can impact product availability and market growth. Another challenge will be maintaining the freshness of beverages. Dispensaries must implement proper storage solutions to ensure product quality.
Marketing Strategies for Cannabis Beverages
There are several strategies dispensaries can employ to successfully promote cannabis-infused drinks. The main ones fall into the following three categories:
1. Consumer Education: Informing consumers about dosing and the differences between cannabis beverages and traditional edibles is essential. Beverages typically have a faster onset time, offering a more controlled experience that can appeal to those new to cannabis or seeking a specific effect. Understanding different cannabinoid ratios, such as THC-only or CBD blends, can also guide consumers in selecting products that meet their needs.
2. Social Media Campaigns: Leveraging social media and influencer partnerships can attract younger demographics, as they are more likely to engage with brands online.
3. Creating a Social Experience: Hosting events centered around cannabis-infused beverages, like mixers or happy hours, can foster community and encourage purchases.
How to Maximize Shelf Space for Cannabis Beverages
Effective merchandising can enhance sales. To maximize profits, dispensaries will want to strategically place beverages near complementary products, and using eye-catching signage can draw attention. Storage solutions should also be evaluated when developing sales tactics. Proper refrigeration is the key to maintaining product quality and ensuring freshness.
Conclusion
Cannabis-infused drinks have evolved from a niche product to a major category in the U.S. cannabis market, offering dispensaries an opportunity to diversify their inventory and attract new customers. As legalization spreads and demand for healthier, socially acceptable cannabis options increases, the market for cannabis-infused beverages will likely continue to expand. By understanding current trends and preparing for future growth, dispensary owners can leverage this emerging segment to maximize their success in 2025 and beyond.
