Cannabis drinks have attracted a lot of hype based on their potential to bring new consumers into the industry, but early iterations of these drinks haven’t been runaway success stories.

There are a variety of factors at play, but according to the data available, one key issue may simply be a lack of interest from the existing consumer base.


In an interview with the Investing News Network (INN), Michelle Sundquist, director of innovation product design with SoRSE Technology, a Seattle-based CBD product developer, talked about the development of these drinks and their future.

Sundquist spent 20 years with Starbucks (NASDAQ:SBUX) in a variety of roles, but primarily focused on product development, alongside research on consumer interest trends for new beverages.

The beverage expert said the hesitation seen from consumers is to be expected as purchasing tendencies and understanding of these beverages settle in.

“They may not have trust in the ingredients, they might not have trust in the format,” Sundquist said.

“There’s a little confusion as to, ‘If it’s in my beverage, how much should I have? Is it real? How much CBD is really in it? And does it come from a reputable company?'”

In the end, attracting consumers will require proven marketing and beverage design tactics, she said.

“People might be a little bit hesitant to buy it because it’s not calling out to them as something that’s made for them,” Sundquist explained. “So a lot of it comes down to figuring out who your consumer is and figuring out how they are going to get your product.”

What about brand new consumers? Sundquist told INN if a consumer walks into a store not knowing about the products available, they will likely gravitate towards something that looks familiar to them.

“It’s not enough just to have a solid product if the flavors are not right, if the timing is not right, if the place isn’t right — then you’re going to have a really difficult time,” she said.

Canada poised to deliver modern drinks market

In Canada, Canopy Growth (NYSE:CGC,TSX:WEED) has relentlessly pursued consumers who may be open to making cannabis drinks their preferred delivery method.

“Based on our research, 17 percent of Canadian adults who currently don’t consume cannabis say they intend to use recreational cannabis … We see a significant opportunity to recruit these intended consumers through products like our drinks,” CEO David Klein said this summer, according to a report from Marijuana Business Daily.

In its most recent quarterly report, Canopy Growth, which has a partnership with Constellation Brands (NYSE:STZ), notes that it sold just over a million cans of its drinks during the period.

What’s more, Klein told Yahoo Finance the company’s drinks represented 74 percent of the total beverages sold in Canada over a year-to-date period as of mid-August.

However, the promise hasn’t reached its full potential, and currently vape pen products dominate the Cannabis 2.0 portion of products in Canada. Recreational products became legal in October 2018, but ingestible and vaporized products didn’t go up for sale until a year later.

Cannabis giant Canopy Growth will also soon be facing increasing competition as the love child corporation from cannabis producer HEXO (NYSE:HEXO,TSX:HEXO) and Molson Coors Beverage (NYSE:TAP,TSX:TAP) finally launches its drinks into the market.

The offerings from Canopy Growth and HEXO have attracted increased attention given the companies’ relationships with major beverage companies.

CBD plays a key role for wellness consumers

CBD is a strong mainstream element of the cannabis market, and when it comes to beverages Sundquist said CBD drinks tend to tap into the idea of wellness — an industry that reached US$4.5 trillion in 2018.

Consumers’ desire to know more about ingredients and the wellness aspect associated with a wide range of products are directly tied to the rise of CBD wellness products, Sundquist said.

An instant connection between CBD and the wellness segment, according to the beverage expert, is sparkling water products.

“People want to drink sparkling water because it hydrates, it has no calories, they don’t have to worry about clean ingredient statements because it’s just water,” Sundquist said. “Adding CBD sparkling water is an easy connection into something that people can easily incorporate into their lives.”

Don’t forget to follow us @INN_Cannabis for real-time news updates!

Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

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