12% of current non-consumers are expected to enter the cannabis market
- Nearly three-quarters of current consumers are not loyal to a particular product or brand
- One-third of non-consumers say they don't know enough about cannabis to consume it
- Anticipated new consumers are most interested in baked goods, confectionery products
TORONTO, Aug. 15, 2019 /CNW/ - Canada could see as many as 3 million new consumers enter the cannabis market due to legalization and availability of edibles, extracts and topicals (together referred to as "2.0 products") according to a survey conducted by EY Canada and Lift & Co. (TSXV: LIFT) (OTCQB: LFCOF). That figure represents the conversion of approximately 12% of current non-consumers.
"New product offerings will open the doors for experimentation among current and non-consumers giving cannabis companies the opportunity to capture a larger market share," says Monica Chadha, EY Canada Cannabis Leader. "But companies should keep in mind that these consumer segments will have very different attitudes towards cannabis and product formats, ultimately driving the need for differentiated customer experiences."
Current cannabis consumers make up 17% of the Canadian adult population, according to Statistics Canada. The survey from EY and Lift & Co. finds quality, intended effects and potency are some of the most important criteria for consumers evaluating purchases, with less focus on the brand. Data indicates that 70% of current consumers who purchase through brick and mortar retail channels do not know what product or brand they are going to purchase prior to entering the store.
"Understanding the nuances of your customers' values and interests, and having the right tools to determine these, are key," says Matei Olaru, CEO for Lift & Co. "The right data will allow companies to continually innovate, create value for consumers and build customer loyalty."
Contrary to current consumers, the non-consumer segment is less concerned with potency and price and places more emphasis on clinical research and recommendations from health care practitioners to make purchasing decisions. One-third (33%) of non-consumers surveyed report not knowing enough about cannabis to consume it. Going forward, they indicate an interest in experimenting with low dosage baked goods, confectionery and food additive products.
"Current non-consumers need more information before they feel comfortable trying cannabis products," says Chadha. "Deciphering through online information for what's credible can be a challenge. Companies will need to determine the best way of building awareness and educating targeted consumer segments as one way to help inform the purchasing decision and build brand loyalty."
Olaru adds: "Budtenders play a pivotal role in educating consumers at the point of purchase. Their recommendations are heavily influenced by word of mouth and online product reviews so engaging the budtender community will be a critical differentiator for cannabis brands."
Access the full EY Canada and Lift & Co. report As 2.0 opportunities emerge, can you still compete with 1.0 strategies? for insights and perspectives for licence holders and retailers to challenge the way they currently integrate consumer data into their strategies.
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About Lift & Co.
Lift & Co. (TSXV: LIFT) (OTCQB: LFCOF) is a publicly traded technology company modernizing the cannabis industry.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accept responsibility for the adequacy or accuracy of this release.
Although the Company (Lift & Co. Corp) has attempted to identify important factors that could cause actual results, performance or achievements to differ materially from those contained in the forward-looking statements, there can be other factors that cause results, performance or achievements not to be as anticipated, estimated or intended.
There can be no assurance that such forward-looking statements will prove to be accurate or that management's expectations or estimates of future developments, circumstances or results will materialize. Accordingly, readers should not place undue reliance on forward-looking statements. The forward-looking statements in this news release are made as of the date of this release. The Company disclaims any intention or obligation to update or revise such information, except as required by applicable law, and the Company does not assume any liability for disclosure relating to any other company mentioned herein.
SOURCE EY (Ernst & Young)
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