Cannabis' comparisons to Silicon Valley are only apt if we note that unlike smartphones, there's still a long way to go before we achieve saturation. To do that, the marijuana industry needs some changes, only some of which it can implement itself.
For all the endless hype — the earned media prevaricating between open-mouthed fawning and hand-wringing, the disruptive attention from investors, and the caterwauling from police and prohibitionists petrified of a world with new rules — it’s important to remember that marijuana is still a fringe pursuit.
Cannabis enjoys favorable comparisons to Silicon Valley, sure. As the only other industry to appear in our lives as if overnight, technology is a convenient measuring stick. It’s also hyperbolic wishful thinking to compare the two in apples-to-apples style.
Consider: more than two-thirds of Americans, and 86 percent of adult Millennials, own smartphones, still the vehicle of choice for any venture that touches tech. Compare that to the number of Americans who smoke weed. According to the National Institutes on Drug Abuse, the nation’s monthly marijuana users number only 22.2 million — or fewer than ten percent of the population. Thus far, the meteoric growth of a legalizing industry segueing from the black market to government regulations has protected this willful overselling from painful exposure, but the razzle-dazzle of the marijuana industry likely won’t last forever.
Let’s assume that’s low, and that participants in a government-run survey are less than forthcoming about their drug habits. Another recent survey pegs the number of “regular” users of marijuana — that is, people who use cannabis at least once or twice a month — at 35 million, or slightly more than ten percent of the population.
That’s better, but not exactly the kind of market estimate to make a venture capitalists’ heart sing. Imagine a world where only ten percent of us had an iPhone — and we only used it every other weekend, after the kids were safe in bed. Apple would be a cute little company with an interesting booth at the International Consumer Electronics Show (CES), not a global juggernaut.
But there is a favorable comparison to be made to consumer electronics. Unlike smartphones, cannabis is far from achieving saturation — there is still room to grow.
Over half of cannabis consumers are Millennials, and men outnumber women almost two-to-one. This means women and all people over 40 are new frontiers for the marijuana industry. There hasn’t been opportunity like this since Uber set sights on China.
But in order for cannabis to take advantage, and to avoid stumbling like Uber has in China, weed will have to break free from some major hindrances. Here are four of the biggest hurdles cannabis needs to jump in order to maximize its market presence:
Cannabis is Over-Reliant on Super-frequent Users
If the cannabis industry relied on the 35 million people who smoked just once or twice a month, there would be mass layoffs at dispensaries. For now, a relatively small percentage of heavy users are keeping the marijuana industry afloat.
According to data crunched by Colorado’s Department of Revenue, 50 percent of marijuana users use fewer than five times a month — and account for less than 3.5 percent of sales. Meanwhile, another roughly 22 percent of users who consume daily account for nearly 70 percent of all sales.
The “average” marijuana user is a 37-year-old male who spends about $100 a month on flower, but in reality, a few Millennials are coming in to spend hundreds of dollars a week. What the cannabis industry needs, then, are more people from all walks of life, who spend just a little more, who have figured out a way to weave cannabis into their lives, if not daily, at least every other day.
Cannabis Still Has an Image Problem
There aren’t enough positive representations of marijuana use and users for most of us to stand up and say, “Yes, I smoke weed, and I’m a good person.”
Seth Rogen, this is partially your fault.
Weed already has white males (studies show this). But there still aren’t very many role models for the demographics where cannabis has growth potential: women, people of color, people over 60. Much of this has to do with how society has “rewarded” these people: with visits from Child Protective Services, with trips to jail, with misinformation and propaganda.
There is still ample room for a respected mainstream voice to start saying what we know to be true: weed is a relatively benign substance, a safer alternative to alcohol, and an even safer substitute for habit-forming pharmaceuticals like opiates.
Former NFL players like Jake Plummer taking non-psychoactive cannabis oil for post-concussion syndrome is a start, as is Whoopi Goldberg’s line of non-psychoactive, beauty product-like offerings geared towards women. But cannabis-infused bath salts and marijuana-based “romantic aids” aren’t going to matter if people can’t see themselves using them.
What weed really needs is a celebrity endorser with wide appeal like Ivanka Trump, although preferably without the overseas sweatshops.
Marijuana Needs to Become Boring
Smartphones are ubiquitous because they are simple. Look: a touchscreen! Look: icons! A few apps, and you’re set for life. If an iPhone and iOS are the standards of our day (and they are), cannabis is still a PC running MS-DOS.
Even experienced users are overwhelmed by the size of the average dispensary menu, with brand-new strain names every week, and budtenders who have the task the size of a sommelier’s, but with the training and expectations of someone working a beer-and-shot dive. What is all this? What will it do? You don't know, exactly? Imagine sales patter like that at a car dealership.
Cannabis needs to figure out a way to become less ritualized and more boring if it wants to capture a Walgreen’s-sized market. Being able to sell in a simpler, standard setting without ID checkpoints and security guards isn’t something the industry can grant itself, but it can absolutely work on standardized products with predictable, consistent dosing and stupid-obvious, idiot-proof directions and results.
The customer experience at many dispensaries is in need of enhancement, if not a total overhaul, if the untapped women-and-Boomer segments are going to feel welcome.
Marijuana Use is Still a Risk
Smoking weed won’t kill you — unless you’re an immunocompromised AIDS or cancer patient using weed tainted with fungus — but it can absolutely rob you of your ability to earn a living...and more. That’s not weed’s fault. It’s society’s, which is neither welcoming nor friendly, even in the legalization age.
Employers have the right to fire a worker for smoking weed — and that’s in the states where adult-use cannabis is legal. And if you’re a parent, drug use is still a serious risk, particularly if you’re involved in a custody battle. Weed can lose you your job and your kids.
If you go to any marijuana industry conference, you’ll hear stuffed shirts in suits prattling on about advocacy and education. They may sound like hectoring bores repeating catchphrases — and they may be — but they’re right. If the marijuana industry was longsighted enough, it would be dedicating much of its profits towards advocacy and education efforts to countermand the decades of brainwashing for which we have DARE to thank.