The age of cannabidiol (CBD) has arrived in terms of health and beauty.
Despite U.S. market revenues of CBD topical and skincare items forecast at nearly 1 billion dollars in 2019, an increasing number of businesses agree the CBD does not turn a blind eye. CBD is not just another natural ingredient for health and beauty goods, but it comes with the multi-dimensional nuances that render it special.
The cultivation of hemp-derived CBD is federally legalized. It is in keeping with the consumer interest in developing topical CBD formulations that are both large, well-established health players and beauty players such as the Estée Lauder and the L’Oréal, as well as small- and emerging CBD players, including the Charlotte web Hemp and the CV Sciences. Most notably, many large retailers recently introduced services to offer topical CBD items, while some have already begun sales of CBD in 2016; Walgreens, CVS, Rite Aid and Sephora.
A natural evolution
Increased customer understanding of safety and well-being has contributed to a significant shift towards natural health and beauty goods that drive natural extracts’ demand. Consumers are looking for alternatives to synthetic chemicals for both beauty and skincare products from CBD supplier to optimize and boost the well-being and appearance of their bodies. In a recent survey of American consumers, 64 percent of respondents suggested that they needed to buy safe, clean or customized beauty items.
The amount of CBD posts in social media increased by an annual compound growth rate (CAGR) of 80% since 2015, and nearly 60% of responses on social media relating to CBD are optimistic. Although just 20% of addressed consumers have used CBD over the past six months, usage is expected to grow rapidly — over 40% of non-users claim that they would “possibly” or “definitely would” use CBD beauty over the next six months.
Consumers also show an interest in a range of health benefits related to CBD. Importantly, the 2019 Health and Wellness Survey from L.E.K. Consulting states that those who have tried CBD beauty products express great satisfaction at the efficiency of the CBD products they use.
Increasing customer recognition and curiosity contribute to high revenue growth. Since the passing of the U.S. in 2018 Farm Bill, topical sales of CBD drugs expanded exponentially. CBD topical products currently account for around 25% of the CBD category but are expected to take part in ingestible products resulting from the United States.
CBD market tailwinds
High relative market interest: The level of interest in CBD is growing exponentially faster than in other plant extracts. While this generates enormous winds for future entrants into the sector, it has also contributed to a very competitive, quickly changing, chaotic environment for both products and customers.
L.E.K.’s research into consumer products identified a broad range of different consumer segments, each of which is unique, interested in using CBD. CBD is also useful as an element and is incorporated into a variety of drug types for regional care.
Distinctive common terminology and possible stigma: While CBD is extracted from hemp, not marijuana, the minds of customers who may equate CBD with T.H.C. and CBD with opioid myths maintain social stigma and confusion. The jargon used in CBD goods, including ‘broad-spectrum vs. isolate’ and ‘cannabis oil vs. cannabis extract,’ adds to uncertainty because of a lack of general awareness by customers.
A more complicated supply chain: The Farm Bill has provided a road to legal CBD cultivation, but hemp is a difficult product. Nevertheless, although those on the CBD industry were originally concerned about import limits, the United States’ surface area devoted to cannabis cultivation more than quadrupled in 2019, about new data suggesting sector over-supply. Despite the developing state of growth, cannabis content and performance rates for CBD extracts still differ. Internationally produced CBD could be an advantage, but foreign plant extract consistency problems could be a concern.
The quality assurance of CBD’s dosage (if businesses do not use the CBD isolate) is important, and research is still in development. Customers still do not realize the precise dose to be safe for topical goods. The main task is, therefore, to maintain a secure, traceable supply of CBD in favor of scaled development and to assess the appropriate dosage.
A heavily scrutinized process: although hemp-related CBD was withdrawn as a federally regulated drug under Schedule I, legal challenges exist. The CBD industry will use potential legislation to protect the federal status of hemp production since the Farm Bill is extended every five years. The F.D.A. has challenged CBD’s precise position in cosmetics and opened the industry to more regulatory review.
Given the heavy legal scrutiny of product claims, firms must weigh legal risks with trade opportunities. When companies decide to proceed with CBD, they must ensure that no misleading/false claims are made and, if ultimately introduced into retail space, that the product is classified as safe. With the rigor of the quality control requirements and procedures and permits, firms will be more actively equipped to sell CBD goods than other successful plant extracts.
Implications on-demand for businesses and labels
CBD is simply not a plain functional plant extract that can be used in every formulation. Complex variations are expected by health and beauty firms. CBD-interested marketers ought to ask themselves several important questions to see whether CBD is correct for them / their brands:
CBD brings the health and wellness industry into the future, where it offers lucrative business prospects. As consumers increasingly look for natural extracts of subjects that enhance the body proactively, companies need to understand and schedule CBD products’ unique nature. Every business on the CBD outskirts as others continue to focus on new developments would be at risk of losing a fast growth chance.