Herbal Profiles #66

Author

Lars Miller
December 06, 2024

Welcome Note

Welcome back Gardeners!

Back with the polls! Coming off of Thanksgiving I asked my communities Did you have Infused Beverages at your Thanksgiving?

A little over 50% of the respondents said yes. Which I was pleasantly surprised by. I didn’t ask specifically what people drank but several people shared.

Several brands got a shout out. Hippie Water, Louie Louie, Pharos, and Find Wunder.

Hoping to see that number increase next year!

I know this poll has been going for awhile now, I am just trying to leave it up for as long as possible to give as many people as possible the time to fill it out. So thank you to those who have responded, I am hoping to get the results out here in the next few weeks. I am conducting a little survey/research into people’s experiences with these beverages. If you have 2-4 minutes to complete this survey I would greatly appreciate it! I am waiting until I have a good representative amount of people to release any of the responses. So check it out, share it, etc.

In case you missed it, I just launched a new podcast with David Gonzalez and the fifth episode was released Tuesday with Lisa Hurwitz. So be sure to subscribe on Apple, Spotify, or wherever you get listen to podcasts. Also, be sure to rate us and maybe give the Youtube Channel a follow to if that’s your jam!

The Happi Effect: Inside the Future of Functional THC Beverages with Lisa Hurwitz

Free Spirits with David Gonzalez & Lars Miller · Episode

open.spotify.com/episode/5Y2zARi1GAChHF87PeZDdH

Any comments or questions? Leave comment on this post or shoot me an email. Would love to hear from you!

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How Shifting Demographics and Living Patterns Are Reshaping Cannabis Beverage Opportunities

The cannabis beverage industry stands at a unique intersection of three powerful trends: a booming functional beverage market currently valued at $121.18 billion, the rapid growth of cannabis beverages with a 19.6% CAGR, and a fundamental shift in American household demographics where one in four Americans now live in multi-generational homes.

This convergence isn't just creating new opportunities—it's reshaping how cannabis beverages can position themselves in the broader beverage landscape.

The New Functional Frontier

The functional beverage market is projected to reach $200.08 billion by 2032, driven by consumers actively seeking products with specific benefits. Cannabis beverages, valued at $1.9 billion in 2022, are growing at a significantly faster rate than traditional functional beverages, suggesting they're capturing a unique space in consumers' wellness routines.

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The Multi-Generational Effect

The rise of multi-generational households is reshaping purchasing dynamics in unexpected ways. Rather than constraining budgets, 76% of these households report improved financial health, leading to more experimental purchasing patterns. This is particularly evident in beverage choices, where households of five or more people have increased their alcohol spending by 66% over the past decade.

For cannabis beverage brands, this presents a unique opportunity. Multi-generational households aren't just sharing space—they're sharing experiences and influencing each other's consumption habits. Older consumers, traditionally seen as conservative in their choices, are becoming more experimental with new products when living with younger family members.

The Youth Factor

Today's young consumers approach beverages with unprecedented sophistication. Recent research shows they're highly educated about ingredients, actively seeking functional benefits, and increasingly skeptical of artificial additives. "I want to reach the highest of my abilities, so I need to take care of my body every day," explains one 17-year-old consumer interviewed by Sightlines.

This wellness-focused mindset aligns perfectly with cannabis beverages' positioning. Young consumers are particularly drawn to products offering controlled dosing options and specific functional benefits—attributes that cannabis beverages naturally provide.

Market Integration Success Stories

The cannabis beverage market is seeing success in both on- and off-premise channels. Planet 13's Dazed Lounge in Las Vegas exemplifies the on-premise opportunity, offering THC cocktails priced between $15-35. Their success hinges on familiar consumption formats and lower THC dosing options, which give consumers more control over their experience.

In the off-premise sector, major retailers are embracing the category. ABC Fine Wine & Spirits in Florida reports consistent week-over-week sales growth across approximately 30 SKUs, with consumers showing particular interest in products focused on education and responsible consumption.

Future Opportunities

The convergence of these trends—multi-generational living, functional benefits seeking, and evolving consumer preferences—creates a clear pathway for cannabis beverage growth. Successful brands will be those that:

  • Develop products with cross-generational appeal

  • Focus on specific functional benefits

  • Maintain premium positioning while demonstrating clear value

  • Invest in consumer education

  • Execute multi-channel distribution strategies

The cannabis beverage category is uniquely positioned to capitalize on these demographic and consumer shifts. By understanding and adapting to these trends, brands can create products that resonate across generations while maintaining their unique position in the functional beverage landscape.

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The Education Imperative

As cannabis beverages move into mainstream retail channels, education becomes increasingly critical. ABC Fine Wine & Spirits' executive vice president of sales and distribution notes that "sales have been consistent week to week, and we expect substantial growth as guests become more educated and comfortable with how these products affect them."

This education isn't just about effects—it's about positioning cannabis beverages within the broader functional beverage landscape. Consumers are actively seeking products that deliver specific benefits, and cannabis beverages are uniquely positioned to meet these demands while offering an alternative to traditional alcohol consumption.

The Social Shift

The timing for cannabis beverage expansion couldn't be better. Young consumers are increasingly seeking alternatives to traditional dating app culture and bar scenes, creating opportunities for new social spaces and consumption occasions. Cannabis lounges and consumption spaces are filling this void, offering controlled environments where consumers can explore products in a social setting.

Looking Ahead

The cannabis beverage industry stands at a pivotal moment. With functional beverage market growth projected through 2032 and changing household dynamics creating new consumption patterns, the opportunity for category expansion is significant. Success will depend on brands' ability to:

  • Create products that appeal across generational lines while maintaining authentic positioning

  • Develop clear functional benefit propositions that resonate with health-conscious consumers

  • Build educational initiatives that demystify cannabis beverages for mainstream consumers

  • Establish price points that reflect premium positioning while acknowledging shared household budgets

  • Navigate the evolving regulatory landscape while maintaining focus on consumer needs

Conclusion

The convergence of multi-generational living, functional beverage growth, and evolving social patterns isn't just creating opportunities—it's reshaping the future of cannabis beverages. Brands that understand and adapt to these demographic and consumer shifts will be best positioned to capture market share as the category continues its rapid growth.

The key lies in viewing cannabis beverages not as a niche product, but as an integral part of the broader beverage landscape—one that's uniquely positioned to meet the functional, social, and experiential demands of today's diverse consumer base.

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