Consumers use CBD for relief from a wide range of health and wellness challenges. Anxiety, sleeplessness, pain, and stress top the list for many. Some use CBD to treat aching muscles and sore joints following exercise. When asked in a 2021 cannabis consumer insights survey, 12% of CBD consumers called out using CBD as an “exercise” solution, especially for recovery afterward. Those who use CBD with exercise show some marked differences in the data from CBD consumers in general.
These people scrutinize the ingredients of food and drinks and steer away from medications in favor of more natural options. Yet when asked, show a much greater openness to mainstream brands bringing CBD products to market.
Similarly, much like most CBD users, the exercise consumer has yet to find a go-to product. Only about a third have found a product or format that “works” for them. The disconnect might explain why more than 40% reported welcoming CBD products from “well-known companies” such as CPG brands. If few people in this group have settled on a product and many are fine with the prospect of big brands entering the category, what should the industry do?
Sidebar: Why is this important?
Why is the question worth worrying about? Because the market is potentially huge. Forecasters expect the OTC painkillers segment alone to reach $6.7 billion this year. Consider the breadth of the competitive set and thus the size of the prize. Based on the range of benefits CBD consumers experience, the list of competitors extends past the likes of Advil and Tylenol.
M&A activity signals the attractiveness of this market as well. CPGs have snatched up small challenger brands in the category. In recent years, Nestle acquired hydration tablet maker Nuun and several vitamins and supplements brands including Nature’s Bounty. Not to be outdone, Unilever has acquired several emerging health wellness brands like electrolyte drink mix brand Liquid IV and Joe Rogan’s Onnit, makers of “brain, workout, and health supplements”.
CBD Industry Hits a Home Run
Now we arrive at the recent news. CBD brand Charlotte’s Web signed an exclusive multi-year partnership with Major League Baseball, propelling the brand (and by extension, the CBD category) even further into the mainstream market. The Charlotte’s Web SPORT – Daily Edge tincture now features the MLB logo on the bottle and an “Official CBD of MLB” badge on the CW site.
Major League Baseball isn’t sponsoring the product per se – MLB is now a shareholder in Charlotte’s Web. In an interview with Yahoo! Finance, CEO James Tortoroli described the arrangement:
“It’s not a pay-to-play, right? I mean, the two parties with MLB being a shareholder in Charlotte’s Web, our interests are aligned to grow value through wellness, and through our products that offer those solutions for need states that consumers and players and their fans ultimately have. So both parties are aligned in a mission of wellness.”
(If anyone ought to be seeking out CW’s Daily Edge right now, it’s Astros ace pitcher Justin Verlander. The 39-year-old struck out 11 en route to a Game One victory in the ALCS. Any late 30something needs more than a post-game ice bath to recuperate. The Astros slated Verlander as the starting pitcher for Game One of the World Series too. Here’s guessing he is hoping for another sweep.)
The press release (and the CW page) calls out product claims beyond exercise recovery and pain management. Per the release, athletes stand to benefit from the tincture by “supporting recovery, helping sleep cycles, maintaining focus, and helping them stay calm under pressure.”
Finding the Strike Zone for CBD Consumers
So while the benefits – less sleepiness and pain, reduced anxiety and stress – align with the typical top usage drivers for CBD consumers generally, we’re looking at a product and strategy with a particular consumer or group of consumers in mind. High Yield data shows that the target group (or an approximation at least) is excited by the prospect of big food and drink brands in CBD. That will happen eventually and it’s not necessarily good for the industry. How can consumers who might welcome the likes of Nestle be retained?
First, partner companies can act as a proxy for big brands. (If the brand recognition of the partner company is high enough, as “MLB” might suffice to vet a CBD brand for a consumer who’d otherwise like to see a big brand on the label.) For that matter, not all big CPGs are potential competitors. Some may be considered “complementary” to CBD. Either approach could assuage the concerns of 20% of all CBD consumers who believe big brands would improve product standards and safety.
The “Holistic” Athlete
CBD brands considering innovations specifically tied to the sports and fitness market should consider drilling down on the notable disparities called out here. What is behind the preference for natural remedies? What consumer needs are being met with functional foods?
What does a “healthy lifestyle” look like in this consumer’s mind?
For example, take the overlap between consumers using CBD for exercise recovery and functional foods. Key attributes for people who consume functional foods and use CBD post-game include:
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Adventurous: 78% like to “try new products and brands”
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Informed: 72% read ingredient labels prepurchase and 28% have heard of failed lab tests (compared to all CBD consumers at 15%)
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Selective: 63% want clear dosage and usage instructions on the package and 48% look for packaging that enables on-the-go consumption.
Looking at data on a granular level could help discover a particular niche where are CBD brand can cultivate a passionate fan base with the right solution. (An easy-to-dose, clearly labeled, and grab-and-go format of a multifunctional product looks like one place to start.) That’s a classic starting point today for many “challenger” brands.
Spreading the Word
One final thought on the partnership between Charlotte’s Web and the MLB: Charlotte’s Web has created an opportunity for more communication, education, and interest with those who tune into the October Classic. (The 2021 World Series games between the Atlanta Braves and Houston Astros drew an average of 11.75 million viewers.) Few other moments will nicely symbolize the efforts of the industry to break down stigmas and dispel misconceptions than getting CBD in front of the millions who love America’s game.
Questions? Comments? We’d love to hear from you. Email [email protected]
Feature image by Jose Francisco Morales on Unsplash
