Are Cannabis Concentrates Brands Losing Their Appeal to Gen Z?
The cannabis industry is undergoing a significant transformation into the fast-moving consumer goods sector. Consumer preferences are shifting toward more convenient and accessible ready-to-use products rather than raw materials or semi-products like cannabis concentrate. To learn more about how the cannabis consumption market is trending toward the FMCG industry, click to read Is Cannabis Market Transforming into a Fast-Moving Consumer Goods (FMCG) Sector?
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This shift is particularly evident in the declining market share of cannabis concentrates, including concentrate products. Once popular for their potency and versatility, cannabis concentrates are gradually losing ground, especially among younger consumers like Gen Z. This article explores why cannabis paste brands are losing traction, the rise of Gen Z as a dominant consumer group, and strategies for cannabis brands to adapt.
Declining Market Share in the Cannabis Concentrate Industry
Cannabis concentrates, while still highly valued for their potency, have seen a consistent decline in market share over the past few years. Data from Headset highlights a slow reduction in the market share of cannabis concentrates in the U.S., falling from 9.5% in the start of 2021 to about 6% in the mid of 2024 year.
In addition, the price of cannabis concentrates has fallen over the years, particularly in Canada, where the average price dropped from about $48.88 in January 2020 to $25.97 by May 2022. This downward trend in both sales and pricing reflects the waning appeal of these products in a market that increasingly values convenience.
One of major factors for this decline is the complexities associated with using concentrates. Unlike edibles or vapes, which are user-friendly and ready for immediate consumption, concentrates often require additional equipment, knowledge, and preparation, such as dabbing or cooking. For the average consumer, especially those in younger demographics, this represents a barrier to entry.
Do Cannabis Concentrates Align with Gen Z’s Lifestyle?
Gen Z consumers, many of whom grew up during a time of increasing cannabis liberalization, are more likely to view cannabis as a daily supplement or snack. They prefer easy-to-use products like vape pens, drinks, and edibles, which require less effort and are more accessible than cannabis concentrates.
Moreover, consuming cannabis concentrates as semi-finished products feels too complicated for many young consumers. They have to consider occasions whether suitable for rosin dabbing or cannabudder cooking. While concentrates are potent, safe, and natural, they often require more preparation and specialized tools, which doesn’t match Gen Z’s fast-paced, convenience-driven mindset.
This generation seeks products that fit seamlessly into their routines. Vape pens, being portable and discreet, perfectly cater to these needs. Gen Z’s interest in THC-dominant products also highlights their shift away from traditional forms, as they prioritize immediate, enjoyable experiences that align with their wellness and recreational habits.
Gen Z Emerging as Major Potential Cannabis Consumers
Young consumers are quickly becoming a significant consumer group in the cannabis market. According to Headset, year-over-year sales for Gen Z women (born in 1997 or later) soared by 151% in 2020, marking the highest growth among any group. Gen Z men also exhibited substantial growth, with an increase of 118%. By contrast, Millennials and Gen X saw sales increases of about 50% and 30%, respectively. This age group is particularly attracted to the cannabis industry for its convenient, portable, and modern products, such as THC all-in-one vapes and flavorful edibles.
Data from Headset
A key factor in Gen Z’s consumption habits is their preference for ease of use and instant gratification. Products that require minimal effort, such as THC vape pens, are perfectly suited to their fast-paced lifestyles. Vape pens have become the most popular product categories among Gen Z rather than traditional cannabis flowers. Gen Z had contributed 29.8% and 22.7% to vape sales in the Canadian and U.S. cannabis markets in 2023, respectively, which exceeds their consumption in other cannabis categories.
Given Gen Z’s overall buying behavior, this shift towards vapes and similar products is unsurprising. They values convenience, portability, and variety, leading them to opt for products that are easy to use and available in multiple formats. Their desire for variety is also reflected in their lower brand loyalty, with only 20.6% of Gen Z consumers remaining loyal to a single brand. Consequently, for cannabis concentrate brands, this means adapting to their evolving preferences to capture a larger share of this rapidly growing demographic.
Young Consumers Prefer Personalized & Portable Cannabis Vapes
One critical factor driving Gen Z’s preference for cannabis vapes is convenience. Surveys have shown that Gen Z values easy access to products, availability, and home delivery options when making purchasing decisions. An IBM study found that younger consumers prioritize factors like convenience, product variety, and customer service, often placing these considerations above brand reputation. This generation, raised in the digital age, is also more likely to embrace the technological advances offered by cannabis vape products, which allow for portable, discreet, and user-friendly consumption.
In addition to convenience, cannabis brands targeting younger demographics have taken note of this preference for personalization. As a result, cannabis vaporizer companies have focused on product differentiation, from offering diverse flavors to crafting sleek and attractive designs. This emphasis on personalization and experience has made cannabis vapes particularly appealing to younger consumers, as they seek products that fit their fast-paced, technology-driven lifestyles. The growing popularity of differentiated cannabis products among Gen Z is reshaping the cannabis market, pushing brands to innovate continually to capture and retain this influential consumer base.
How Cannabis Concentrate Brands to Better Attract Gen Z?
For cannabis concentrate brands, the key to remaining competitive is innovation. Concentrates, while highly potent, are perceived as less accessible than other products. To regain market share, brands should consider developing more user-friendly products. This might involve transforming cannabis concentrates into FMCG formats, such as THC-infused drinks, gummies, or rosin vapes.
Moreover, brands should emphasize diversity in their product offerings, catering to the personalized tastes of Gen Z consumers. Vape products, for example, can be differentiated through unique flavors, innovative designs, and customizable features. Technology can also play a role in making products more appealing; for example, the introduction of smart vape devices that allow users to control temperature and dosage could attract tech-savvy consumers.
However, integrating concentrates into vaporization products comes with its challenges, such as the cost of production and supply chain complexities. Brands like Artrix offer vaporization hardwares to help cannabis concentrate producers enter the vaporization market at minimal cost, through products like the DabGo AIO dab pen and DabPod system. By partnering with technology providers, paste brands can create more accessible products without sacrificing quality.
While traditional cannabis concentrate products may be losing appeal among younger consumers, the potential for growth remains if they can adapt to the changing landscape. By focusing on convenience, personalization, and product innovation, these brands can regain their place in the cannabis market. As Gen Z continues to shape the future of cannabis consumption, brands that respond to their needs for accessible, differentiated products will be the ones that thrive.
