CannabisNewsWire
Editorial Coverage: With experts such as the Brightfield Group
predicting the hemp-derived CBD (cannabidiol) market will reach $22 billion by 2022, major industry players
such as Anheuser-Busch are seeing value and viability in the direct
selling approach to selling CBD products.
- With a predicted 130 percent compound
annual growth rate (CAGR) over the next three years, the
hemp-derived CBD industry looks primed to explode.
- The direct selling approach to selling CBD products pioneered
by brands such as Youngevity International is attracting the
interest of large-scale companies.
- Given new medical studies proving the efficacy of daily CBD
intake, the market appears ripe for companies with vested interests
in other lifestyle markets.
Following the passing of the groundbreaking 2018 U.S. Farm Bill
that legalized the industrial cultivation of hemp nationally,
scores of companies not endemic to the cannabis industry are
looking for ways to enter the booming CBD market. Partnerships and
acquisitions look to be one of the most promising strategies, with
many savvy companies utilizing the direct selling route originated
by brands such as Youngevity International Inc. (NASDAQ:
YGYI) (YGYI
Profile), a leading omni-direct lifestyle company.
New Age Beverages Corporation (NASDAQ: NBEV)
recently merged with a direct selling company to distribute its CBD
products, while beer giant Constellation Brands Inc. (NYSE:
STZ) poured a $4 billion
investment into Canadian cannabis company Canopy Growth
Corporation (NYSE: CGC) (TSX: WEED).
Anheuser-Busch InBev (NYSE: BUD) (OTC: BUDFF) also
partnered with a leading Canadian cannabis producer to research cannabis-infused drinks and owns 20 percent
of Icelandic Water Holdings, which recently entered into an
exclusive joint-marketing/development agreement with Youngevity to
develop and sell CBD-infused products.
To view an infographic of this editorial, click here.
A Market Primed to Skyrocket
The recent deregulation, legalization and proliferation of the
cannabis industries in the United States and Canada made 2018 a
landmark year for those industries, creating an ideal scenario for
an astronomical growth rate. Canada’s recent move to legalize
recreational marijuana and the United States’ decision to legalize
the industrial cultivation of hemp nationwide has experts
forecasting the global cannabis industry to exceed $39 billion by 2023 and possibly exceed
$95 billion by 2026.
Within that market, the hemp-derived CBD segment will likely
grow at an even faster rate, with that growth buoyed by the fact
that it doesn’t have to pass any state legalization hurdles across
the United States. Brightfield Group expects the hemp-CBD
industry’s growth to outpace the rest of the cannabis industry
combined, and Hemp Business
Journal estimates the hemp market to grow around 700
percent by 2020. With the meteoric growth predicted, companies such
as Youngevity International Inc. (NASDAQ:
YGYI), which already have established direct-selling
channels that can nimbly adapt and upscale marketing, production,
and delivery, could see a boon in business.
Direct Selling Method Attracting Corporate
Giants
Given the nascent nature of the cannabis industry, many
consumers are just learning about CBD products, meaning that growth
within the industry is happening in the most organic fashion
possible: word-of-mouth marketing. Brightfield Group notes that
more than 50 percent of CBD consumers in all U.S. regions first
learned about CBD from friends or family, which makes direct
selling companies a “fantastic fit” for the CBD industry.
Studies by Direct Selling
News show that direct selling companies already lead the
global market in sales of CBD products with more than $300 million
in annual sales. Therefore, the interest of larger, non-endemic
companies in the direct selling model of brands such as Youngevity
only makes sense and may signal that, as the cannabis market
continues its stratospheric growth, so too will the direct selling
sector within the industry.
Increased Medical Studies Cause Increased Interest in
CBD
One of the main driving forces behind the rapid increase in
popularity in CBD globally is increased awareness by consumers of
the widespread medical uses of CBD. Research has shown that CBD,
particularly when used daily, can help treat
and prevent symptoms of Alzheimer’s disease, chronic pain, anxiety,
insomnia, arthritis, epilepsy and a slew of other ailments.
Given that, companies such as Youngevity — which has the ability
to deliver CBD in convenient packaging and applications for daily
use — may have an upper leg when it comes to profiting off the
growing trend. Knowing that, it makes sense that Youngevity
recently announced an exclusive joint-marketing agreement with
Icelandic Water Holdings, a company in which Anheuser-Busch has 20
percent ownership.
Youngevity and Icelandic plan to develop and sell CBD-infused
dietary supplements, children’s drinks, pet products, and coffee
products via Youngevity’s direct selling platform. This move seems
to validate not only the viability of the direct selling model in
selling CBD products but also the potential windfall businesses
already established in other lifestyle industries may experience by
integrating into the CBD sector.
Lifestyle Direct Selling Companies Poised to Capitalize
on Expanding CBD Market
Globally, the direct selling market is growing. Research by
Euromonitor shows that the direct selling market is expected to reach $163 billion by 2020, with the
largest portion of that business coming from the wellness industry.
Given the aforementioned promise of the CBD market in the direct
selling industry, along with the expected continual growth of the
direct selling industry at large, it only makes sense that direct
selling companies poised at the intersection of the cannabis,
wellness and other lifestyle industries may be best suited to
capitalize on the inclusion of CBD in other industries.
Youngevity could be an ideal example of just such a company. The
direct selling expert has already established a sterling presence
in the coffee industry through its wholly-owned subsidiary CLR
Roasters, a proven farm-to-cup pipeline that can be quickly and
easily adapted for hemp cultivation. Its holdings in other markets
ripe for CBD inclusion such as the beauty and wellness industries,
Youngevity may be best positioned to harness the incredible growth
in the CBD market, particularly via large-scale corporate
partnerships and mergers.
CBD Market Continues to Draw Non-Endemic Interest as
Direct Selling Flourishes
New Age Beverages (NASDAQ: NBEV) recently
merged with the direct selling company Morinda with the stated
intent to sell CBD products through Morinda’s direct selling model.
This appears to be a solid endorsement of the viability of direct
selling in selling CBD. Created in 2016, New Age has developed a
brand portfolio competing in the highest growth segments of the
beverage industry and has created the only one-stop-shop of healthy
beverages. By combining with Morinda, New Age plans to rapidly grow
its brands by adding a direct-to-consumer infrastructure and market
access to 60 countries around the world.
Constellation Brands (NYSE: STZ) has similarly
shown that the beer industry is keenly interested in the CBD
market. It recently invested $4 billion in Canadian cannabis
producer Canopy Growth (NYSE: CGC) (TSX: WEED),
telling U.S. lawmakers it was "extremely bullish,
if not more bullish" on the prospect of selling CBD-infused
drinks in the United States. following the nationwide legalization
of industrial hemp cultivation via the 2018 U.S. Farm Bill. Given
its positioning as a premium beer, wine, and spirits company,
Constellation’s interest in the market may signal that other large
corporations in the premium beverage market may see viability in
CBD.
Canopy Growth was the first cannabis company in North America to
be publicly traded, then followed that milestone by becoming the
first North American cannabis company to diversify its platform to
include both greenhouse and indoor growing, to acquire a major
competitor and to be listed on the Toronto Stock Exchange. Through
its subsidiary, Canopy was also the first cannabis company to
introduce the now-standard concept of compassionate pricing, making
medical cannabis more affordable for patients.
Anheuser-Busch Inbev (NYSE: BUD) (OTC: BUDFF),
the massive brewer that makes Budweiser Bud Light, and more than
500 other beer brands, has shown a keen interest in the CBD market.
The company recently partnered in a $100 million
joint venture with Tilray Inc., a leading Canadian cannabis
company, to research cannabis-infused drinks for the Canadian
market. Currently the partnership is limited to Canada, with the
companies making decisions regarding the commercialization of the
beverages in the future. Anheuser-Busch said it would participate
in the project through its subsidiary Labatt Breweries of
Canada.
The recent nationwide legalization of hemp cultivation in the
United States, as well as the nationwide cannabis legalization in
Canada, has created a rapidly expanding CBD market. With the proven
success of direct selling companies in selling these products, it
seems the direct selling industry will continue to help propel the
CBD market as large-scale, non-endemic companies look for ways to
gain entry into the market.
For more information on Youngevity, visit Youngevity
International, Inc. (NASDAQ: YGYI)
About CannabisNewsWire
CannabisNewsWire (CNW) is an information service that provides
(1) access to our news aggregation and syndication servers, (2)
CannabisNewsBreaks that summarize
corporate news and information, (3) enhanced press release
services, (4) social media distribution and optimization services,
and (5) a full array of corporate communication solutions. As a
multifaceted financial news and content distribution company with
an extensive team of contributing journalists and writers, CNW is
uniquely positioned to best serve private and public companies that
desire to reach a wide audience of investors, consumers,
journalists and the general public. CNW has an ever-growing
distribution network of more than 5,000 key syndication outlets
across the country. By cutting through the overload of information
in today’s market, CNW brings its clients unparalleled visibility,
recognition and brand awareness. CNW is where news, content and
information converge.
Receive Text Alerts
from CannabisNewsWire: Text "Cannabis" to
21000
For more information please visit https://www.CannabisNewsWire.com and
or https://CannabisNewsWire.News
Please see full terms of use and disclaimers on the
CannabisNewsWire website applicable to all content provided by CNW,
wherever published or re-published: http://CNW.fm/Disclaimer
CannabisNewsWire (CNW)
Denver, Colorado
www.CannabisNewsWire.com
303.498.7722 Office
Editor@CannabisNewsWire.net
DISCLAIMER: CannabisNewsWire (CNW) is the source of the Article
and content set forth above. References to any issuer other than
the profiled issuer are intended solely to identify industry
participants and do not constitute an endorsement of any issuer and
do not constitute a comparison to the profiled issuer. The
commentary, views and opinions expressed in this release by CNW are
solely those of CNW. Readers of this Article and content agree that
they cannot and will not seek to hold liable CNW for any investment
decisions by their readers or subscribers. CNW is a news
dissemination and financial marketing solutions provider and is NOT
registered broker-dealers/analysts/investment advisers, hold no
investment licenses and may NOT sell, offer to sell or offer to buy
any security.
The Article and content related to the profiled company
represent the personal and subjective views of the Author, and are
subject to change at any time without notice. The information
provided in the Article and the content has been obtained from
sources which the Author believes to be reliable. However, the
Author has not independently verified or otherwise investigated all
such information. None of the Author, CNW, or any of their
respective affiliates, guarantee the accuracy or completeness of
any such information. This Article and content are not, and should
not be regarded as investment advice or as a recommendation
regarding any particular security or course of action; readers are
strongly urged to speak with their own investment advisor and
review all of the profiled issuer’s filings made with the
Securities and Exchange Commission before making any investment
decisions and should understand the risks associated with an
investment in the profiled issuer’s securities, including, but not
limited to, the complete loss of your investment.
CNW HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.
This release contains “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E the Securities Exchange Act of 1934, as amended and
such forward-looking statements are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act
of 1995. “Forward-looking statements” describe future expectations,
plans, results, or strategies and are generally preceded by words
such as “may”, “future”, “plan” or “planned”, “will” or “should”,
“expected,” “anticipates”, “draft”, “eventually” or “projected”.
You are cautioned that such statements are subject to a multitude
of risks and uncertainties that could cause future circumstances,
events, or results to differ materially from those projected in the
forward-looking statements, including the risks that actual results
may differ materially from those projected in the forward-looking
statements as a result of various factors, and other risks
identified in a company’s annual report on Form 10-K or 10-KSB and
other filings made by such company with the Securities and Exchange
Commission. You should consider these factors in evaluating the
forward-looking statements included herein, and not place undue
reliance on such statements. The forward-looking statements in this
release are made as of the date hereof and CNW undertakes no
obligation to update such statements.
Source:
CannabisNewsWire
Contact:
CannabisNewsWire (CNW)
Denver, Colorado
www.CannabisNewsWire.com
303.498.7722 Office
Editor@CannabisNewsWire.net
Constellation Brands (NYSE:STZ)
Historical Stock Chart
From Apr 2024 to May 2024
Constellation Brands (NYSE:STZ)
Historical Stock Chart
From May 2023 to May 2024