According to the 2021 U.S. Cannabis Consumer Evolution study released by New Frontier Data, cannabis consumer annual spending continues to climb with legal U.S. cannabis annual spending ($19.9 billion) now surpassing annual consumer spending for bottled water ($19.4 billion) and over the counter pain medications ($19.3 billion).

Furthermore, nearly half of U.S. adults (43%) now live in states where adult-use cannabis is legal with another 30% living in states where only medical use is legal. That means just 27% of U.S. adults live in states where cannabis is illegal in 2021, and if recent legislative measures across the country are an indicator of the future, that number will continue to drop sooner rather than later.

Who are all of these cannabis consumers and how can brands connect with them in a rapidly growing industry that could fall victim to brand saturation in the near-term? The findings in New Frontier Data’s report provide some useful insights for cannabis businesses. Let’s break it down into the who, when, where, why, and how of cannabis consumer behavior to see what opportunities are available for brands to exploit.

Who are Cannabis Consumers?

New Frontier Data identified 10 different cannabis consumer archetypes based on its research results. Five of those archetypes (48% of cannabis consumers) purchase cannabis from legal sellers while the others purchase from illegal sources or get cannabis for free from friends.

That means the easiest consumers to attract to your cannabis brand today are those who are already part of the legal marketplace. Those five archetypes are described as follows (listed in order from the most frequent users to the least frequent users):

• Savvy Connoisseurs: 8% of the total market (17% of the legal market), Savvy Connoisseurs mostly buy from legal brick-and-mortar dispensaries or retailers. They are the highest spending cannabis consumers and the most frequent consumers. They consume a variety of product forms.
• Contemporary Lifestylers: 9% of the total market (19% of the legal market), Contemporary Lifestylers mostly buy from brick-and-mortar dispensaries or retailers. They consume cannabis (flower and non-flower) very frequently.
• Modern Medicinals: 13% of the total market (27% of the legal market), Modern Medicinals mostly buy from dispensaries/retailers and delivery companies. They use cannabis frequently, are high spenders, and consume many forms (primarily non-flower).
• Engaged Explorers: 10% of the total market (21% of the legal market), Engaged Explorers mostly buy from dispensaries/retailers and delivery companies. They are frequent users, recreational users, and mid-range spenders. They consume the widest variety of product forms.
• Holistic Healers: 8% of the total market (17% of the legal market): Holistic Healers mostly buy from dispensaries/retailers or delivery companies. They are infrequent users, and primarily use cannabis for medical purposes (e.g., pain). They primarily use topicals, tinctures, and edibles, but few use flower.

In order to effectively position your cannabis brand and create marketing messages that resonate, you need to personalize experiences and communications to the right audience. Consider these five consumer archetypes as you create your marketing plans. There is definitely an opportunity for your brand to carve out a niche and even seize the leadership role among these target audiences.

What do Cannabis Consumers Buy?

Today, consumers are primarily buying both flower and non-flower cannabis products (57% of consumers). New Frontier Data’s research discovered that the number of consumers who only use flower is getting smaller with just 24% of consumers saying they only use flower products. In fact, 19% of consumers said they don’t use flower at all.

Since 2018, the number of U.S. adults who use flower declined by 5%. On the other hand, usage increased for other forms:

• Edibles: Increased 19%
• Tinctures: Increased 8%
• Topicals: Increased 8%
• Vape Pen: Increased 7%
• Flower: Decreased 5%

It’s important to point out that what people buy varies by age. New Frontier Data found that consumers between the ages of 18 and 35 are twice as likely than those 55 or older to use both flower and non-flower products. Here’s the breakdown:

• 18-34 Years Old: 15% consume only flower, 70% consume both flower and non-flower, 16% do not consume flower
• 35-54 Years Old: 21% consume only flower, 60% consume both flower and non-flower, 18% do not consume flower
• 55+ Years Old: 40% consume only flower, 35% consume both flower and non-flower, 25% do not consume flower

Just because the use of flower is down doesn’t mean it’s not a good opportunity. The key is to understand each of the consumer archetypes as well as nuances related to age and develop marketing messages that are highly relevant to each audience. That’s where the opportunities for success are in 2021.

Where do Cannabis Consumers Buy?

The study found that 41% of legal cannabis consumers buy from licensed brick-and-mortar dispensaries and retailers (up from 27% in 2018), and 15% buy from delivery companies (up from 8% in 2018). Considering that a big part of cannabis sales is actually bringing customers into the dispensary where they can interact with budtenders, investments need to be made into marketing programs that increase store traffic.

New Frontier Data found that the most essential thing cannabis consumers claim keeps them loyal to a retailer is familiarity. That means bringing new and repeat customers into the retail setting is essential to growth and represents an opportunity that dispensaries and retailers can capitalize on.

Using discounts and promotions, hyping a wide variety of products at multiple price points, developing loyalty programs, and offering incentives are all ways to increase foot traffic and seize those opportunities.

Why do Cannabis Consumers Buy?

Another big piece of the puzzle when developing your marketing plan and messaging strategy is understanding why consumers purchase cannabis. New Frontier Data found that 42% of cannabis consumers self-identify as primarily medical (27%) or only medical (15%) users while 58% self-identify as primarily recreational (24%) or only recreational (34%).

Diving in a bit deeper, recreational and medical consumers use cannabis for different reasons. Here’s the breakdown of the top five reasons for using cannabis among medical consumers:

1. Pain Management: 59%
2. Relaxation: 55%
3. Stress Relief: 55%
4. Reducing Anxiety: 51%
5. Improving Sleep Quality: 47%

Here’s the breakdown for recreational consumers:

1. Relaxation: 76%
2. Stress Relief: 67%
3. Reducing Anxiety: 51%
4. Falling Asleep: 44%
5. Improving Sleep Quality: 44%

This data is very helpful when it comes to creating messaging strategies that position your brand as the best solution for different consumer needs. A one-size-fits-all brand messaging strategy won’t work in the cannabis industry where consumers use products for so many different reasons. The opportunities to grow come when you get laser focused on hyper-targeted audiences.

How do Consumers Use Cannabis?

Another important thing to consider as you develop your messaging strategy is how consumers use cannabis. New Frontier Data found that more cannabis consumers use cannabis alone than they do with other people. The numbers are a bit different among medical and recreational consumers:

• Always/usually use alone: Medical = 76%, Recreational = 47%
• Use alone about half the time: Medical = 15%, Recreational = 25%
• Always/usually use with others: Medical = 9%, Recreational = 29%

Bottom-line, you could waste your opportunity to connect your brand with cannabis consumers if your messaging and imagery doesn’t match how they actually use cannabis products.

Key Cannabis Brand Opportunities

Brand opportunities in the cannabis industry are abundant for those companies that take the time to fully understand the many consumer segments who buy cannabis products.

This is a rapidly growing industry with new consumers entering the marketplace all the time. Businesses that assume they know who their target audiences are and how to speak with those consumers will lose brand growth opportunities because what worked last year may not work this year.