The CBD market has been growing at unprecedented rates since the passage of the 22018 Farm Bill. Now that CBD products have become popular all across the world, it’s time to find out where the industry is headed next.
The passage of the 2018 Farm Bill marked the beginning of the CBD boom in the United States. The bill legalized the regulated production of hemp – a specific type of cannabis that was not differentiated from other cannabis plants up to that point. Thus, products containing cannabinoids extracted from legal hemp (with less than 0.3% THC) also became legal at the federal level, although their legality remains in a grey area at state level.
Despite the numerous hurdles, the recent advances in cannabis legality gave way to a world of possibilities for hemp growers, manufacturers, and retailers, and they wasted no time in taking advantage of all the opportunities lying in front of them. That set the foundation for a flourishing CBD industry that has continued to grow and expand at a rapid pace ever since. In 2020, the sale of CBD products in the United States amounted to 4.6 billion U.S. dollars, and the market is expected to reach 16 billion dollars in value by 2016.
Based on all the data we have and the evolution of the CBD market so far, it’s safe to say that CBD is here to stay. Since CBD has taken the world by storm over the past 4 years, we can’t help but wonder what the future will look like for the CBD industry, so let’s see what experts have to say about it.
Battle for clearer legislation
At the moment, the lack of clarity regarding the legal status of CBD derived products is not only posing numerous challenges for CBD businesses – making it difficult for them to obtain capital from financial institutions and to market their products and services – but it’s also creating a lot of confusion among consumers. People are having trouble understanding whether it’s legal or not to purchase CBD products in their region, and this only leads to the perpetuation of cannabis stigma and stereotypes.
There’s no denying that the industry requires clearer laws and regulations on CBD and all cannabis-derived products. The good news is that the U.S. Congress has already taken some steps toward addressing these issues through a series of legislative projects that will lead to stricter quality standards and make it possible for CBD products to be marketed as dietary supplements in the future.
CBD is big business at the moment and, according to the latest predictions, is about to get a lot bigger in the years to come. That can only mean one thing: we’re going to see more businesses entering the market and thus fiercer competition in the industry will ensue. One would say that bigger means better, but that remains to be seen.
From an entrepreneur’s perspective, breaking into the market and staying afloat will be much more challenging. Newcomers and established brands alike will have to work harder to win consumers’ hearts and differentiate themselves from the competition. But from a consumer’s point of view, that will translate into a wider range of options to choose from, which obviously represents a major plus.
Bigger players will enter the field
Speaking of newcomers, things are about to change in this area as well. If up until now, small businesses and startups were the ones that constituted the majority in the CBD industry, we can expect bigger players to enter the field in the near future.
Larger companies have been relatively reluctant to join the green rush due to the lack of a clear legal framework and the regulatory impediments stemming from it that made the CBD industry look like the Wild West. However, as the industry is no longer in its infancy and will further stabilize over the next years, many of these obstacles will be eliminated, so corporate giants will set their eyes on the CBD industry.
More product diversity
Most consumers agree that the existing CBD companies provide a diverse range of products to meet all needs and preferences. One can choose from a vast array of CBD oils and tinctures, balms, CBD flowers, edibles, Yummy CBD Oils, beauty products, and so on. However, there’s always room for more, and as the market continues to expand, we’re bound to see a whole new range of CBD products hitting the market.
But it’s not just the product range that will grow more diverse, but also the audience. Usually, we tend to associate CBD products with the younger generation, but in recent years people from all age categories have taken an interest in cannabis-derived products, so companies will most probably shift their marketing strategy to cater to a wider range of consumers.
Adapting to marketing challenges
Experts have yet another marketing-related prediction, this time concerning the obstacles and challenges that marketers have had to face ever since the legalization of hemp. Due to current marketing restrictions on CBD products, it is very difficult for CBD companies to reach their audiences and promote their products and services using the existing marketing channels.
However, people in the CBD industry seem to be very creative, so they’ve thought up a good workaround to these problems, turning their attention towards influencers, brand ambassadors, and affiliate marketing. Experts believe this will become the preferred marketing strategy for CBD brands in the future, but traditional marketing is not excluded either. It all depends on how fast authorities will act on improving the legal framework and the measures they will adopt further.
These expert predictions paint a rather bright future for the CBD industry in 2022 and beyond. However, considering there are many variables at play here and a good dose of unpredictability, it’s almost certain that the CBD market will continue to surprise us as it always did.
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