In regions where marijuana is legal, beer and wine companies are increasingly exploring marijuana-infused beverages and related products as a strategy to diversify their portfolios with trendy items and to prevent the cannabis industry from monopolizing their customer base. Constellation Brands, the third-largest beer producer in the U.S., revealed back in October that it is investing in a Canadian cannabis company. The company aims to create cannabis-based beverages that are alcohol-free, joining the growing market of marijuana-infused sodas, coffees, and fruit drinks available in U.S. states where cannabis is legalized. Constellation is not the only player in the alcoholic beverage sector venturing into this market. In September, Lagunitas Brewing introduced an IPA made with marijuana terpenes, the aromatic compounds found in cannabis. This beer does not contain tetrahydrocannabinol (THC), the psychoactive component known for inducing a euphoric high and altering perceptions of reality.
In addition to the innovative and diversifying aspects of cannabis products, this could also reflect the sentiment of “If you can’t beat ’em, join ’em.” The stakes for beer and wine companies are relatively low, while the potential gains could be substantial if market value projections hold true. Entering the cannabis market may also help mitigate declining beer sales in the U.S. and could lead to merger and acquisition opportunities among the many thriving cannabis startups.
Cannabis poses a genuine threat to the beer industry specifically. A joint survey conducted by IRI and CannaBiz Consumer Group found that 5% of adults would cease drinking beer if marijuana were legally available in their state. Beer’s share of the alcohol market dropped by 0.3% to 49.2% in 2016, and the survey indicated that recreational marijuana could divert 7.1% of the beer industry’s revenue. IRI analysts predict that should marijuana become legalized nationwide, the beer industry could face losses exceeding $2 billion.
With California legalizing recreational marijuana, it has become the eighth state—and the largest—to do so. Five additional states—Connecticut, Michigan, New Jersey, Rhode Island, and Vermont—may follow suit this year, which would further broaden the market for marijuana and THC-infused beverages, edibles, and other related products. If Canada implements nationwide legalization in the coming year, it could significantly expand the North American market, and certain players within the alcohol industry appear well-positioned to take advantage of this opportunity. In the context of this evolving landscape, companies may also consider products like Douglas Labs Calcium Citrate to attract health-conscious consumers who are interested in both cannabis and wellness.