Beyond the target market: How CBD is helping brands reach broader demographic
Cannabinol (CBD) is garnering interest across the globe. In the UK alone, the Centre for Medicinal Cannabis (CBC) predicts the market will be worth approximately £1bn per annum by 2025.
Analysing research conducted by YouGov, CBC found that approximately 6m adults have used CBD in the UK and estimates that 1.3m consumers are spending more than £300m per year on CBD products.
Food and drink products containing CBD are helping fuel this growing interest, with many attracting consumers from beyond their traditional target markets.
Functional beverage start-up Botanic Lab claims it was the first UK brand to launch a CBD soft drink in 2018. Today, Botanic Lab’s CBD range includes ‘Dutch Courage’ – containing CBD, sour cherry, and hibiscus – and a cold pressed ‘Mellowdrama’, containing CBD, Schisandra, and panax ginseng.
CBD is a non-psychotic compound produced by the Cannabis sativa L. plant. Products containing CBD must have low or no levels of Delta-9-tetrahydrocannabinol (THC) – which is the psychoactive compound associated with becoming ‘high’ from cannabis.
Both products contain 5mg of full-spectrum CBD, which Botanic Lab sources from Europe.
“The public perception is overwhelmingly positive and has [attracted] a huge amount of interest,” said Botanic Lab CEO Rebekah Hall.
And perception appears to be evolving as time goes on, she suggested. “Resoundingly, the first question that [consumers] asked was ‘Will I get high?’, and that does seem to have moved on a bit.”
Today, questions focus more on dosage, benefits, and transparency in the supply chain, suggested Hall at start-up event Bread and Jam in London earlier this year. “We are seeing a really engaged consumer who wants to learn more about this.”
This engaged consumer does not always necessarily fit within the brand’s target market, however, which Hall said has allowed Botanic Lab to broaden its appeal.
The start-up targets its functional drinks to 18-30 year-old metropolitan-based consumers. Typically, such consumers have disposable incomes and ‘want to try something new’, we were told.
“We have seen that broaden with [CBD] products. There are a lot of stories and anecdotal evidence of people from an older audience finding CBD helpful to them. There is [also] a lot of curiosity from a younger generation.
“To be frank, we live in a society where the modern-day ailment is stress and anxiety, so this ingredient has the ability to resonate with a whole raft of age groups, types of demographics, and people,” said Hall.
While it hasn’t altered Botanic Lab’s marketing strategy, the CEO said she finds it interesting to see potential future customers “in places we may not have been able to reach them before”.
Drink 420: ‘CBD demand isn’t just in London’
Botanic Lab is not only the only drinks brands to have observed a broadening demographic of consumer interest in its CBD beverages.
UK soft drink brand Drink 420 is owned by Raylex Brands, a UK-based start-up that also has Simplee Aloe and WOW in its portfolio. Each 250ml can of Drink 420 soft drink contains 15mg of CBD sourced from Colorado. The products are sold in either elderflower lime or wild berries flavours.
Drink 420 launched in early 2019 after nine months of product development. Similarly to Botanic Lab, Drink 420 has received ‘really positive’ feedback, said Raylex Brands co-founder and CEO Alex Lai.
In terms of market reach, Lai said CBD is attracting interest from across the UK. “One of the most interesting things we’ve seen is that CBD demand isn’t just in London. There is demand across the country.
“It’s not like coconut water, for example, which was a London thing for many years until it expanded outside of [the capital]. There is a good nationwide understanding of CBD.”
Drink 420 is targeting the Millennial consumer with flavours that ‘might be a little bit more female focused’, said Lai. Yet the brand has also observed interest from consumers outside of this demographic.
“It has been interesting [to see] the age of people [who] understand what CBD is,” he revealed, suggesting that older generations may purchase food and drink containing CBD because it is ‘more accessible’.
The Marshmallowist: ‘Very few people really know what CBD tastes like’
Confectionery start-up The Marshmallowist says it is the UK’s first gourmet marshmallow brand. Run by sisters Oonagh and Jenny Simms, the start-up sells marshmallows in a range of gourmet flavours, including blueberry and gin; caramelised apple and cinnamon; and spiced tomato and vodka.
The brand also sells a range of marshmallows infused with 10mg of CBD. This range includes cannabis and pink grapefruit; cannabis and dark cocoa; and cannabis, blood orange and rosemary.
The Marshmallowist sources its full-spectrum CBD from Yorkshire-based The Tonic, which collaborates with a Dutch grower to supply cannabis oil products.
“We first introduced a limited-edition CBD marshmallow 18 months ago and now it is our best-selling product,” said director Jenny Simms at Bread and Jam.
The decision to venture down the CBD route was sparked by consumer demand. “They came to us and said ‘We love what you are doing with alcohol in marshmallows, and I use CBD, do you think you could create something that wasn’t a gummy bear out of this?’, said Simms.
After a month of intensive kitchen trials, The Marshmallowist launched its first limited-edition CBD marshmallow. Since then, the brand has received media attention from the Daily Mail and the New York Times.
Consumer response has also been positive, with a great number engaging with the brand to enquire about taste profile, the company reports. “That is the question we get all the time,” the director revealed, “very few people really know what CBD tastes like”.
A six-pack of The Marshmallowist’s products sells for £15, which Simms said keeps the brand ‘distinct’. However, the luxury range is garnering interest from a wide demographic of consumers, she revealed, “not just the young”.
“I was quite surprised at how it caused a shift in the demographic of who our customer was,” said the director. “We have definitely seen a change in who is coming to us to buy our product.”
FoodNavigator is co-hosting a two-day CBD Global Summit in London, 16-17 March 2020. The event wants to bring together the science, business and regulation governing CBD to look at how businesses can unlock this important market opportunity. For more details, check out our advanced programmed, and view confirmed speakers, visit the CBD Global Summit website.