Winning in CBD Oil Market

CBD Oil Market Outlook & Key Findings

• CBD oil’s ability to reduce pain by regulating endocannabinoid system (ECS), activity and interacting with neurotransmitters makes it an effective ingredient for pain relief, anxiety and depression drugs
• CBD oil is no more a prohibited substance, as The World Anti-Doping Agency (WADA) removed CBD oil from the list of prohibited substances
• Brand owners and manufacturers trying out in non-conventional application area such as lotions, skin care, pet care and textile to mention a few
• The global CBD oil market growth to remain over 30% (CAGR) between 2020 and 2030, indicates Future Market Insights (FMI) statistical projection
• Seven out of ten new CBD oil products launched worldwide belongs to North America and Europe
• Start-ups leading the band-wagon with new formulations and frequent product launches

 

CBD Oil, a Mainstream Ingredient in Pain Relief Drug amidst All Hullabaloo Regarding Safety and Effectiveness

CBD oil is derived from Marijuana and Hemp plants with stress and anxiety-reducing properties. This makes CBD oil a key ingredient used in painkiller and anxiety treatment drug manufacturing.

Supplemental consumption of CBD oil also offers numerous therapeutic benefits for the conditions such as depression, nerve-related pain, sleep disorders, and inflammatory pain.

Drug formulators and pharmaceutical companies were quick to integrate CBD oil in pain-relief medication and flooded the market with new products. Strategic advantage gained by early movers in global CBD oil market left little or no space for new market entrants.

Till 2019 when the size of global CBD oil market was less than US$ 200 Mn, eight out of ten new CBD oil introduced to the market were intended to provide pain relief.

CBD Entrepreneurs Monetizing on CBD Oil Usage in Non-Conventional Use Cases, and Creating a Blue-Ocean

An average of 20 new companies enter the CBD product ecosystem every year since 2017, worldwide. Almost all of these companies were start-ups and CBD oil was one of their first product offering.

Entrepreneurs introduced CBD oil for widespread application which primarily included food, lotions, cocktails, massage oils, textiles etc.

CBD oil has found its way into the textile industry. Microencapsulated CBD is designed to attach to fabrics and improve post wash satisfaction for consumers. Such innovation of microencapsulated CBD is also anticipated to create blue-ocean and enable growth in the global CBD oil market over the coming years.

Non-pharmaceutical application of CBD oil is slated to grow at 1.5 times higher than the average industry growth during the forecast period

CBD’s Popularity as Upcoming Luxury and Beauty Wellness Ingredient Creates Lucrative Growth Prospects

Enthusiasm around emerging science and softening cannabis laws are on the path of legitimizing medicinal claims of CBD oil.

Endorsements by celebrity evangelists are catapulting it as a premium ingredient, paving way for the market players into the cosmetics and beauty industry. The ongoing CBD trends are indicative of a promising future for the market. CBD oil-infused products are enticing influencers from around the world.

The anti-inflammatory and analgesic properties of CBD oil can help in the treatment of psoriasis, eczema, and dry skin. It also helps in suppressing breakouts. In this report, FMI examines the scope of CBD oil in the beauty sector, and indicates that one tenth of CBD oil will be used for skin care product formulation by the end of 2030.

Diluting Consumer Sentiments through Social Listening to Proliferate Potential Customer base

FMI conducted a 360⁰ customer sentiment analysis, including social listening and social sentiment analysis in 2020.

Results of this social sentiment analysis is in-sync with the expectation of brand owners but magnetically opposite from marketing strategies adopted by key market players.

A close to 60% of no CBD oil using respondents mentioned that they restrained away from such products largely due to associated social restriction. Though all such respondents agreed of health benefits of CBD oil.

Result of consumer sentiment analysis by FMI reveals a lot of gap in the promotional and marketing strategies adopted by companies for brand building activities. One of such strategies suggested in the report is to develop an infomercial marketing approach by key brands.

CBD Oil Market Growth Riding High on Flourishing E-Commerce Retail

As per the FMI report, almost half of CBD oil sales happens through online channels. E-Commerce retail enabled established as well as new companies operating in CBD oil manufacturing, marketing and sales to cater customers all around the globe.

The majority of the players offering CBD oil such as Premium Jane, Pure Kana, and CBD one Ltd. are making their products available through e-commerce websites to reach more consumers.

Unlike other industries where share of online sales is poised to increase over the coming years, CBD oil market is likely to reflect a paradox trend. CBD oil demand in the short-term forecast period may witness a modest shift towards brick and mortar.

Online mode of operation equips CBD oil companies with and added supply side advantage. Companies save required sizable investment for product retailing and ensuring last mile supply, without prior demand forecast. E-Commerce as primary mode of business also offers CBD oil companies to track potential customers and draft brand promotion campaigns.

Dominance of the Early Movers Clearly Visible in Global CBD Oil Market

Consumers in North America and Europe dominate CBD oil consumption with over three fourth of CBD oil produced worldwide, either in direct, supplemental or ingredient form.

Apart from North America and Europe, Asia presents lucrative opportunity pockets, yet only a handful of companies are legally open for manufacturing, sales and marketing of CBD based products including CBD oil.

The report on the global CBD oil market by FMI provides elucidated analysis for seven regions i.e. North America, Latin America, Europe, South Asia, East Asia, Oceania, Middle East and Africa. Among these regions, North America and Europe currently lead the market in terms of demand as well as annual growth rate, finds FMI in its latest study.

CBD Oil Companies Eying Avenues Outside of Europe

Japan has been identified as one of the potential countries exhibiting opportunities for companies eying growth in CBD oil market outside of North America and Europe.

Companies operating or are planning to foray in Asian markets have disclosed to be more emphasized on cosmetic and skin care product application area for CBD oil.

In the Middle East and Africa Region, Israel surface as a promising market slated for above global average growth rate.

The placement for the key regions in product lifecycle (PLC) chart below reveals that the CBD oil market in North America is saturated, compelled market players to look for opportunities in Asia and the Middle East and Africa (MEA). The MEA market is currently at a nascent stage, nonetheless the presence of a sophisticated pharmaceutical sector will support growth in the region. Meanwhile in East and South Asia, the market will gain from the rising demand from diverse industries besides increasing investment in the manufacturing sector.

Leading Brand and Companies in CBD oil Market

The market for CBD oil is primarily dominated by the well-established players. Companies operating in the market are focusing on getting certifications such as Possession of Certificate of Analysis (COA), and clean- Label claims to gain a competitive edge.

Key companies and brand assessed and profiled in the report for global CBD oil market are:

Americas

• CV Sciences
• Charlotte's Web
• Medical Marijuana Inc.
• CBDistillery
• Tilray
• Canopy Growth Corporation
• Aurora Cannabis
• Sunday Scaries
• Penguin CBD Oil
• Medterra

Europe

• ENDOCA
• Pharmahemp
• Canzon
• AP Organics
• Blessed CBD
• CBD Pure
• Excite CBD
• The Original Alternative
• Select CBD

Asia Pacific

• Elixinol Global Limited

*The list is not exhaustive, and only for representational purposes. Full competitive intelligence with SWOT analysis available in the report

CBD Oil: The Way Forward

Future Market Insights predicts the global CBD oil market to provide incremental opportunity of over US$ 200 Mn over the course of the report’s forecast period. Approvals by some of the most reputed international organizations and widening applications across diverse sectors are enabling growth in the market.

In the coming years, its use in supplemental cosmetics is likely to surge, thus companies can emphasize and prioritize these application area.  

With several key players trying to make CBD oil more accessible and focusing on getting certified by international organizations, FMI expects the market to grow exponentially in the coming years.

Despite the growing body of evidences supporting health claims of CBD oil, it continues to be sold primarily as a supplement and not a medicine. This definitely restricts manufacturers from making any health claims around their products. Those in the medical industry and individuals may seem to be in favor of promoting CBD as a medical product. However, stringent regulations will continue curtailing sales opportunities unless it acquires complete approval from governments and international authorities.