Month: October 2018

October 5, 2018

How Amazon and eBay could post major profits for the online cannabis market

Amazon and eBay are two; of the largest retailers in eCommerce, and they are positioned to profit from the expanding CBD market, which is also showing marked sales growth.

In a new study, the products that contain CBD, which has no THC that won’t end up getting you high, actually has become really diverse through different channels.  This has started to grow in profits, with the retail sales for this estimated to go all the way to $16 by 2025, and this is based on more conservative assumptions, and spending of less than $2 per customer.

CBD supplements are growing. About 7% of 2500 US adults who were surveyed used this, and the retail sales are only going to increase. Ecommerce is becoming the key distribution channel for these kinds of products. That’s because, they do fall into the categories of personal care and beauty products, along with vitamins and food supplements, all of which seem to have to accelerate online sales and are predicted to only grow.  What’s spurning this is the rising jurisdictions that are being repealed, and where there aren’t prohibitions of marijuana.  That, in turn, has caused the growth of CBD compounds as well. It is a powerful compound too, with many health benefits.

This compound is used for many people for different things, from autism, PTSD, anxiety, autoimmune disorders, and even insomnia and stress. This is a game changer for medical marijuana, since this is safe for anyone to use, and it doesn’t have the psychoactivity that marijuana does, so there is no argument for it to be illegal.

So what does this mean for investors? Well, it is pretty significant. It doesn’t contain THC, which is that compound that causes psychoactive effects in the mind and body, and the “high” sensation that marijuana gives you.  CBD, however, has many of the same components that marijuana does, which means that it’s effective for treating pain, appetite loss, nausea, and other problems in the body as well. This is a subject that’s been ever increased in terms of studies, and there are many that are looking into just what CBD can do for a person.

CBD is becoming a major part of ecommerce, and the category called consumables has major growth.  This is still a highly underpenetrated part of the ecommerce vertical, which means that while it still hasn’t been fully tapped into, this will end up growing over time.  In 2018, the sales during this were $51 billion which means that it was 11% of the total category.  By 2023, it’s expected to have figures that could easily exceed double that or so much more, which means that up to 20% of the market will be this, respectively.

For Amazon investors, this means that it could be a field day for profits. What that means in a lot of cases too is that there could be even more sales for those who invest in it, since a lot of people do buy vitamins and personal care supplements.

Amazon is also working with Whole Foods, and that’s another potential place to sell CBD products, and the company’s only planning on expanding this too. Whole Foods has two hour delivery in a lot of cities, and also curbside pickup. While CBD may appeal in those physical channels, this does mean that there are some potential markets to work into.

With that being said, it’s imperative to consider looking into CBD as a potential growing market. There is a lot here that it has to offer, and many who are looking into getting into CBD investment may see a marked growth in terms of this over time due to the new outreach that comes from that.