Following a “gold rush” mentality, the CBD beauty market shows no signs of slowing down. When BeautyMatter explored the state of opportunity last year, we identified an estimated $28.5 billion future market, with more focus on terpenes, CBC, and CBG, as well as an increased sophistication of product offerings.
What is the 2022 verdict? We explored the latest findings from NielsenIQ, biotech company Purissima, and wellness company Cellular Goods to find out.
Dose of Wellness: CBD in Beauty & Health
Interview with Anna Mayo, Client Director, Beauty Vertical at NielsenIQ
How is the CBD market and consumer evolving?
In the early days of CBD, the ingredient was making its way into anything and everything. However, the market has stabilized now, and we are seeing CBD really concentrate in the vitamins category, as well as in body lotions and pain relief gels.
In the total CBD health and beauty category, vitamins and supplements represent 55%, generating more than $32 million for the 52 weeks ending February 19.
We’re finding the core consumer of these CBD-driven wellness products tends to be older, earning a higher income, and living in the western part of the country. They’re also learning about CBD more through social media and influencers.
What can brands do to elevate themselves above the market competition? It seems like simply having a CBD-containing product isn’t enough given the boom of the category in recent years.
With so many CBD products available, it's likely that consumers who are interested in CBD have already tried it. If brands want to stand out from the crowd, it may be helpful to provide some sort of scientific evidence where CBD enhances the products. To justify the much higher price of these items, the consumer benefit is going to need to be very compelling.
CBD product brand teams also will need to work harder to reach shoppers today. As you say, it’s not enough to just be available. For one, we’re seeing that e-commerce is a key channel for CBD products, and we’re also seeing a dramatic rise in omnichannel shopping in all categories, so that’s an area where CBD product manufacturers can rise above the competition by studying who is buying their products (like the wealthier, older consumer in California), but also how that shopper is buying their products in-store or online.
CBD manufacturers can review integrated online and offline sales data to uncover shopping habits such as, perhaps, an increase in click-and-collect sales of a product and meet that shopper where they’re buying. They can refine marketing messages that reflect who the shopper is and effectively reach them and educate them on CBD where they prefer to shop.
What can we expect from the CBD beauty category in the future?
Within beauty, the CBD category has been a bit slower to take off than we had expected, and there haven't been any real breakout brands in the space. I do think there would need to be significant developments in the category to change the current trajectory of CBD in beauty.
As I noted above, one area I see brands improving upon would be to provide more specific scientific evidence regarding how CBD enhances the product. Consumers are getting more educated about the products they use and claims made. And they are also more price conscious than ever. Until pricing comes down further, the consumer benefit is going to need to be very compelling. CBD beauty brands that provide the most compelling value proposition to consumers will have a competitive advantage, especially as the segment grows.
Now that consumers can shop for these products across retail channels (online, offline, mobile, etc.), brands will need to get smarter about how they identify and reach more granular consumer segments that gravitate to one channel more than another, or alternate between.
Purissima x New Frontier Data Survey
“Our survey partnership with New Frontier Data further reinforced our prediction that the need for new bio-based technologies to produce pure and natural cannabinoids will only continue to accelerate as efficacy evidence becomes more widespread.”
- Rob Evans, Co-Founder, Chief Business and Strategy Officer of Purissima
Production of Cannabinoids Using Biotechnology and Synthetic Chemistry as a Path to Sustainability
“Not only is the production process [of lab-produced cannabinoids] more sustainable, requiring less land, water and producing greatly decreased biomass waste and carbon emissions than agricultural production, but lab production gives the opportunity to increase production without suffering systemic and biological restraints. Use of lab production provides a greater ability to respond to any increases in demand in the cannabinoid space, as consumers become increasingly conscious of the effective skincare and wellness applications of cannabinoids.”
- Anna Chokina, Chief Executive Officer, Cellular Goods
2 Article(s) Remaining