Monday December 10, 2018
The recreational cannabis industry is booming in several states across America. And even though the emergence of legal cannabis industries throughout the U.S. is a fairly recent trend dating back only several years, there have been countless shifts and changes in structure along the way. From individuals selling homemade products to dispensaries all the way to a lack of testing and regulatory oversight, the cannabis industry has been on a rollercoaster ride since its beginning.
This constant development has affected many aspects of the market – including the ways dispensaries and cannabis businesses operate as well as overarching consumer trends. It’s clear that, for the foreseeable at least, the cannabis industry will always be evolving and improving and businesses who don’t keep up with the times will be left in the dust.
So, how do consumers understand these dynamic aspects of the cannabis industry and get a feel for what happens behind the scenes? To give you an inside look into the progression of the cannabis industry, we sat down with Ben Perrone, CEO of Botanico Dispensary in Colorado and longtime cannabis advocate. Perrone has been involved in the legal cannabis industry since 2008 and had some expert insight to share with us. That being said, let’s dive right in!
From Homegrown to Lab-Grown
The journey of legal cannabis (both medical and recreational) is certainly a wild one, complete with a seemingly uncountable amount of undulations along the way. It’s true, the landscape for legal cannabis is always changing – this is easily evidenced by the cannabis industries in more established states like California and Colorado. Both states have had medical marijuana for quite some time, yet each of their respective markets are completely different nowadays than in decades past.
When asked about these changes, Perrone reminisced to his early days working in cannabis. He noted, “The industry is becoming very sophisticated, especially in products like concentrates and edibles. Back in the day, hippies used to come into the dispensary and try to sell tins of pot brownies.” Fast forward to present day where manufacturers are now extremely precise in both dosing and quality. The same goes for concentrates, too. Perrone stressed a “night and day” difference from concentrates 4 years ago to the ones gracing dispensary shelves in modern times.
Concentrate and edibles manufactures have established themselves and adapted to the dynamic aspects of the cannabis industry. They’ve essentially grown with regulations to create cleaner, more consistent products that are higher in quality than their predecessors, resulting in lab-grade products that consumers can trust. And it’s not just lab quality, either. Where edibles and other cannabis products of the past may have been made in home kitchens, the sophisticated nature of today’s industry has seen the development of full-blown labs and professional production facilities.
Progression of the Cannabis Industry
The standards for manufacturing and production aren’t the only things that have changed in the cannabis industry. Pretty much every aspect of legal cannabis, from regulations to marketing all the way down to consumer habits, have evolved over time. Even product trends are constantly shifting – most notably with the increase of concentrate, vape cartridge and edible sales.
Having been around for most of these shifts, Perrone has observed the industry “move away from flower.” He noted that, “Flower’s market share is declining in favor of a dynamic, convenience-based industry and vape pens are the meteor that will overtake flower.” It’s true, concentrate sales (specifically vape cartridges) are on a tremendous uptick, skyrocketing market share as much as 400 percent in recent years. The shift in consumer popularity between different products has made it especially important for businesses to stay on the cutting edge and carry quality products that are trending.
For Perrone and Botanico Dispensary, this evolution has been a great opportunity to showcase their operational flexibility. He noted that “Most businesses have investors, boards and other roadblocks to being dynamic…Botanico has no outside investors and is as local as you can get, making it easily adaptable and capable of pivoting on short notice.” This business ideology has allowed Botanico to stay current throughout the evolution of the industry – as evidenced in their latest initiative, a special VIP program specifically targeted toward cannabis connoisseurs.
Botanico VIP Program Details:
- One on one consultations
- Specific product orders upon request
- First look at new products
- Call-ahead ordering
- Private shopping appointments
- Exclusive VIP parties and events
You see, in the evolving cannabis landscape, flower is becoming somewhat ubiquitous. Of course, it will always be a consumer favorite (especially for seasoned consumers) but it is no longer a product that is unique. Sure, everyone has their favorite grower or dispensary for flower, but with testing requirements becoming an industry standard, the gap between quality flower producers is closing up. More and more dispensaries are now catering to the individual needs of their customers, allowing them to have the freedom of brand selection from one central location.
What’s Next for Legal Cannabis
As consumer trends continue to change over the years, it wouldn’t be out of the question to see more businesses place an importance on flexibility. Botanico’s VIP program signifies a change in consumer habits, as people are no longer seeking out dispensaries but rather brands. In today’s cannabis market, businesses that carry top brands and offer rotating product variety are seeing the most traffic – which makes a lot of sense when you think about it.
Vertically integrated companies are losing market share on a daily basis as consumers look to businesses with a range of their favorite brands.
Perrone made a great point on this notion, saying “Vertically integrated companies simply cannot be dynamic…concentrates, vapes and edibles aren’t as dynamic in a vertical model, either.” Essentially, the industry has grown to allow non-vertical companies to be more robust than ever before. Perrone furthered the argument, explaining “Vertical integration is a great way to control profit margins in a static industry. The main drawback is that we don’t live in a static industry. The industry is dynamic and vertical integration no longer adheres to consumer needs.”
As flower continues to become more and more ubiquitous and widely available, the shift towards brands and innovative products will likely continue to expand. Ultimately, the evolution of the industry will create a great opportunity for consumers to experience cannabis in a completely new and unique way – we’re just excited to be along for the ride.
What shifts or changes have you noticed in the cannabis industry over the years? Share your thoughts in the comments below!