Can Federal Marijuana Legalization Save the Tourism Industry?

The travel industry is in a depression due to COVID-19, according to the U.S. Travel Association. Industry losses include declines in travel, expected to total $80 billion in tax revenue lost during 2020. The downturn led to 51% of the industry losing their job. With the market in such a downturn, one could wonder what the impact cannabis might have. We are beginning to see results come in from specific legal state markets. Additional states legalizing could further prove if the often discussed hypothesis is true. However, for now, the topic remains up for debate until further evidence provides clarity. That said, many markets could use relief, cannabis or not, right now.

Countless destinations across the globe are reeling from the effects of the virus and its stay-at-home orders. Travel destinations like Las Vegas saw its steady flow of tourists come to a screeching halt, cutting off both its out-of-town business and its lucrative gambling industry.

David Farris is the vice president of sales and marketing for Planet 13, the largest dispensary in the world. Farris said it was "no question" that Las Vegas is reeling from the virus. While much has changed, the VP said the major revenue generators would remain in place. Farris told PotGuide, "While the city prepares to rebuild itself post-COVID-19, the power remains with the casinos and hotels, creating a place to stay for people visiting on their trip."

Las Vegas has been severely impacted by the COVID-19 pandemic. photo credit

While forecasts expect travel sectors, like airlines, to see revenues plunge more than $310 billion, some expect travel to resume sooner than later. That said, business and destinations will likely continue to reel from the losses for some time. The revenue chasm created lead some in the cannabis community, and lawmakers, to believe that cannabis legalization will help revive their communities and industries.

On its own, cannabis is unlikely to save the travel industry. Marijuana isn’t a miracle to travel. That said, the plant could play an immense part, according to respondents.

For several years, cannabis tourism has been regarded as a growth industry. By 2016, Denver reported experiencing a 75% increase in travel booking searches compared to the previous year. That said, the same concerns appear to remain. Namely, most cities have yet to determine where consumption is allowed beyond a private residence – and the police can pose threats of being jailed in more restrictive or improperly-policed cities and states.

In 2019, travel blogger and web community host, The Points Guy, discussed how the booming market remains restricted due to federal prohibition. "While many tour operators, hotels, restaurants and bars are embracing marijuana’s booming popularity and conventionality, one fact remains: cannabis, unlike hemp, is still federally illegal." That said, the travel expert predicted significant opportunities for cannabis and travel. "But as the movement progresses, we’ll likely see the travel sector employing new, innovative ways to leverage cannabis to promote tourism."

Andy Fathollahi, CEO of the Southern California cannabis brand Kanvas, discussed efforts made by early adopter states and what may become fixtures in the market. Fathollahi told PotGuide, “With the right safety precautions in place, they can provide a safe environment that brings value to tourists through experience.” He added, “Things like cultivation tours and guided farm visits could be a great place to start.”

Cannabis tours have been enticing options for tourists in legal states. photo credit

Fathollahi believes that other states could achieve similar results if they were to legalize adult use. Speaking directly to COVID-19 economic recovery, Kanvas' CEO laid out a scenario that may prove worthwhile for cannabis tourism brands. Fathollahi laid out the scenario, "Regions that have suffered from COVID-19 can create a safe environment, wherein guests can experience cannabis and cannabis-related products. These resorts could essentially become "bubble environments" complete with testing, social distancing and a focus on outdoor experiences."

Las Vegas took its first steps to re-open around the end of May. Since then, Planet 13’s Farris said visitors are clamoring to get back to the city. “Many people around the world have expressed overwhelming interest in visiting the tourist capital of the world,” reported Farris. He added, “People are ready to experience the glitz and glamour again, as we have customers reach out to us with their plans to visit Planet 13 on their trip.”

Farris elaborated that with live events currently closed, stores like Planet 13 serve as a beneficial destination for memorable experiences while maintaining social distance. However, Kanvas’ Fathollahi noted numerous factors that would shape the travel industry going forward. That said, he notes the power in the plant and its effect on the people. “The benefit cannabis offers tourism is an attraction that eases consumers out of isolation and offers safe, outdoor-focused experiences.”

While cannabis reform is unlikely to come in the near future, it does appear that marijuana-based travel should continue to trend, creating opportunities for the travel industry, careers, tourists and state revenue. Time will tell if the theory proves true for states.

Photo Credit: Sunyu (license)