Analyzing Consumer Trends: What Millennial and Gen Z Cannabis Consumers Want from Brands
Introduction
The cannabis industry is evolving rapidly, driven by changing consumer preferences and increasing legalization. Among the most influential demographics in this market are Millennials and Gen Z. Understanding what these consumers want is crucial for brands aiming to capture and retain their business. This article delves into the key trends and preferences of Millennial and Gen Z cannabis consumers.
Market Share and Demographics
Millennials are currently the largest demographic of cannabis consumers, capturing 46.2% of every dollar spent on cannabis in the U.S. Gen Z, on the other hand, is the fastest-growing group of marijuana users, with their percentage share of total cannabis sales growing by 11.3% year-over-year. Together, these groups make up a significant portion of the market, driving trends and influencing product offerings.
Product Preferences
Millennials and Gen Z have distinct preferences when it comes to cannabis products. Vapor pens are particularly popular, with these two demographics accounting for 70.8% of all Vapor Pen sales in the U.S. This preference is influenced by Gen Z's familiarity with nicotine vaporizers. Pre-rolls are also gaining traction, becoming the third largest product category in the U.S. cannabis market. Sales of pre-rolls increased by 13.4% in the first eight months of 2023 compared to the previous year.
Consumption Habits
Both Millennials and Gen Z have grown up in an era where cannabis legalization is more common, influencing their advocacy for broader legalization. These demographics prefer a variety of consumption methods beyond traditional smoking, such as edibles, topicals, and beverages. The trend of replacing alcohol with cannabis is also notable, with 21% of Dry January participants opting for cannabis and CBD instead of alcohol.
Consumer Behavior
Frequent cannabis shoppers, particularly Millennials and Gen Z, are more likely to research online before making a purchase. 42% of frequent dispensary shoppers check online menus, and 30% look for deals and promotions. This behavior underscores the importance of a strong online presence and digital marketing strategies for cannabis brands.
Sustainability and Values
Environmentally conscious practices are important to Millennial and Gen Z consumers. Sustainable cultivation and eco-friendly packaging can attract these buyers, even at higher price points. Brands that align with their values and lifestyle are more likely to build loyalty and trust among these demographics.
Technological Integration
Advancements in data collection and technology enable businesses to better understand and cater to the preferences of Millennial and Gen Z consumers. Personalized product recommendations and optimized cultivation practices can enhance consumer satisfaction and loyalty. Dispensaries accepting debit cards, for example, earn an average of $4,627 more per day than cash-only retailers, highlighting the importance of technological integration in the cannabis industry.
Case Studies and Examples
- Brand A: Successfully captured the Millennial market by offering a wide range of edibles and beverages, coupled with a strong online presence and educational content.
- Brand B: Focused on sustainability, using eco-friendly packaging and organic cultivation methods, which resonated well with Gen Z consumers.
Cultural and Psychological Factors
Millennials and Gen Z value authenticity and transparency. They are more likely to support brands that are open about their sourcing, production processes, and business practices. The cultural shift towards wellness and self-care also plays a significant role, with many young consumers viewing cannabis as a part of their holistic health routine.
Conclusion
Millennials and Gen Z are pivotal to the cannabis market, driving significant sales and shaping product preferences. Their inclination towards vapor pens and pre-rolls, coupled with a trend of replacing alcohol with cannabis, highlights their evolving consumption patterns. The industry's economic impact and the shift towards cashless payments further underscore the dynamic nature of the cannabis market. Brands that understand and cater to these preferences will be well-positioned to succeed in this rapidly growing industry.
Actionable Tips for Brands:
1. Diversify product offerings to include edibles, beverages, and topicals.
2. Emphasize sustainability and eco-friendly practices.
3. Leverage technology for personalized consumer experiences.
4. Maintain a strong online presence with educational content and promotions.
5. Align brand values with those of Millennial and Gen Z consumers.
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