Pre-Roll Palooza
The cannabis industry’s bifurcation between Adult Use and Medical markets (in Colorado and Oregon) offers unique glimpses into how different kinds of consumers buy marijuana. In general, Adult Use channels reflect broader cross-sections of cannabis users, including tourists (who cannot shop at medical shops if they are visiting from other states), and people who are relatively new to cannabis or not willing to provide state governments information about their cannabis habits (shoppers at Medical channels need state-issued identification cards). Medical channels, on the other hand, have historically attracted a higher concentration of consumers who are already knowledgeable about cannabis — even rising to the level of cannabis connoisseurs — and people who use cannabis explicitly to manage medical issues.
One of the more interesting Medical vs. Adult Use case studies revolves around pre-rolled joints, a subcategory of cannabis that hinges on convenience. Market share for pre-rolled joints varies markedly between different channels in different states.
Through October of 2016 between both Medical and Adult Use channels in Colorado and Oregon, pre-rolls capture 5 percent of the overall cannabis market, with $68.11 million in sales.
Within the Colorado Adult Use market, market share is slightly higher, at 6 percent, with $41 million in sales through September in 2016. But the number plummets within the medical channel, where it garners just 2 percent of the market, at $7 million in sales, through October. The market share within the medical channel for prerolls has barely changed since Colorado began recreational sales: It was about 2.25 percent ($8.76 million) in 2015, and 2.7 percent ($11.46 million) in 2014.
Oregon Adult Use consumers are rather fond of pre-rolleds, spending $19.83 million on them and lifting market share to 9 percent. Oregon Medical? A different story — 4 percent of the market, with $3.12 million in sales. However, the Oregon medical story mirrors the situation in Colorado, where pre-rolls perform well in the adult channel, but struggle among Medical consumers.
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