The Colorado Market, Part 1: Legalization Creates An Evolving Picture Of The Marijuana ConsumerMarch 5, 2019
In 2018, the legal marijuana industry in Colorado had $1.55 billion in sales according to the Colorado Department of Revenue, yielding $267 million in tax revenue, and demand is projected to continue to grow in the coming years. Moreover, Colorado’s typical marijuana consumer isn’t just a 20-something male who loves video games and snowboarding. A number of factors, including consumer education, destigmatization, and greater product assortment, are creating a broader picture of who’s consuming cannabis in the state.
“There are a lot of consumer segments, from high-end, experienced users to daily, budget consumers, to moms looking for discreet options,” says Jessica Lukas, vice president of consumer insights for BDS Analytics, a cannabis market intelligence and consumer research firm. “One surprise is that our data show the average age of the cannabis consumer is 40. They’re generally professionals with full-time jobs—educated, willing to spend more money for quality, and physically and socially active. It brings light to a new picture of who the cannabis consumer is.”
Lukas says the cannabis market still skews male, with about 30%-40% of users being female. But the female segment is growing, and marijuana companies are targeting this group. She also highlights how purchasing behavior doesn’t fit neatly into recreational or medical, as those areas can often overlap. “Approximately 60% of them claim to consume cannabis, at least in some part, to help manage pain. But, 75% of that group also use it recreationally,” said Lukas. “People are consuming for many different reasons—health and medical, quality of life, and social and recreational. There’s a shift from ‘stoner-centric’ brands to brands that offer something for the newer or mainstream consumer.”
Along with tax revenue, the economic benefits of marijuana legalization in Colorado are being measured in various ways such as job creation and residual impact on other industries. As of March 2018, estimates put employment within the marijuana industry at about 17,821 full-time equivalent staff, a 17.7% increase over the previous year, according to “The Economic Effects of the Marijuana Industry in Colorado” report from the Federal Reserve Bank of Kansas City. That means the marijuana industry only makes up around 0.7% of Colorado’s total employment, although it remains among the fastest-growing business sectors in the state.
According to a recent report from Arcview Market Research in partnership with BDS Analytics, Colorado’s legal cannabis market is projected to reach approximately $2 billion by 2022. The report adds that the number of full-time equivalent positions in the state’s cannabis industry could top 36,000 by the same year.—Ryan PeacockSubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning. You will also receive the Cannabis edition as part of your subscription.