Cannabis - It's Recession Proof

Cannabis - It's Recession Proof

Consumers Feeling the Economic Pinch Still Crave Treats and Unique Products

Will cannabis consumers get caught up in the disruption caused by inflation and the recession? Those with the expertise and perspective to know believe cannabis businesses should be ready. In a recent interview, Charlie Bowman, CEO, and President of HEXO, took a stronger stance: inflation is already changing purchase behavior.

Recent data collected by the cannabis market research firm High Yield Insights supports his perspective. The study spanned the 20+ largest markets in the US, surveying frequent cannabis consumers to better understand a range of issues including the impact of today’s economic squeeze. Among other results, the study found that 70% of consumers are now engaging in price shopping, a trend that may be intensified by economic pressures.


The implications are numerous. The most obvious is the impact on dispensary choice.

Shopping Around Impacting Dispensary Choice

Forty-seven percent of consumers shopping on price rank “Low Prices” at the top of the list when picking a dispensary. How does that compare to the average cannabis shopper? Forty-two percent overall put prices at the top. Not insignificant but not unexpected either.

Consumers selecting a store based on prices will also gravitate towards locations that offer sales and loyalty programs. Nothing insightful yet, however:

Online Shoppers Browsing for Bargains 

Cannabis consumers who shop on dispensary websites for in-store pickup are more likely to look for sales and special offers (40% of respondents). Even those who are not looking for deals (34% of respondents) may still spend more, according to data on online spending. Co-op promotions between brands and dispensaries may be effective in getting consumers to spend despite their tighter budgets.

A Cake Pop for These Trying Times

Shoppers looking for good deals might snatch up an unplanned purpose simply because it is on sale. Not new news. But not every impulse buy is triggered by a markdown. What about shoppers less sensitive to price today?

The data shows that consumers often make unplanned purchases when they spot a new product from a favorite brand. This suggests that brands can benefit from introducing new products. However, it is unclear what types of new products are most likely to capture consumers’ attention, such as a new form factor, strain, or pack size.


The data suggest that price-sensitive cannabis consumers prize a treat for themselves in addition to whatever might be on their shopping list. If cannabis follows the “lipstick index” this holiday season, we might see small additions to shopping baskets as consumers look for a little extra relief or a tiny indulgence.



The “surprise and delight” mantra from CPG is clearly carrying over to cannabis this holiday season.


Cannabis Consumers Remain Hungry for Innovation

Even consumers on a budget will make room in the shopping basket for a new-to-me product. In addition to the impact on dispensary choice and impulse buying, today’s economy may also affect product innovation.


In the short term, dispensaries and brands will need some creativity with merchandising and messaging to raise the opportunity for happy discoveries by cannabis shoppers. Despite the economic pressures, cannabis consumers remain hungry for innovation and may be willing to make room in their budgets for new products.


SOURCE: Cannabis Business Executive

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