5 Industries Benefiting The Most From The Legalization of Marijuana
Guest Blog by Ella Woodward
The global legal marijuana market is currently valued at over $17.7 billion and is expected to expand at an impressive Compound Annual Growth Rate(CAGR) of 18.1% over the next ten years, according to Grandview Research.
This will continue the meteoric rise of the cannabis industry that has seen investors and entrepreneurs alike rake in the profits over the past two decades since California first legalized medical cannabis back in 1996. All of this consistent profit is not only for cannabis investors and entrepreneurs either, it has also helped boost a slew of other industries from tech to tourism.
With that in mind today we are going to discuss five industries that are set to benefit the most from the growing legality of marijuana.
Packaging
The packaging industry is probably the sector that has benefitted the most from the legalization of medical and recreational marijuana in many states across the U.S. thus far. In fact, the cannabis packaging market is expected to grow at a CAGR of 26.4% over the next eight years, according to the market intelligence firm, Reports and Data.
That’s makes cannabis packaging one of the fastest-growing industries on the planet in 2020. It’s no wonder why, really. With billions of dollars being pumped into recreational and medical cannabis, and strict packaging laws across the U.S and abroad, the market conditions for cannabis packaging are perfect for sustained growth.
Pharmaceutical
Although the pharmaceutical industry hasn’t yet been able to take advantage of the growth of recreational and medical marijuana sales, the next decade is sure to bring consistent investment. That’s because the DEA and FDA have only recently begun allowing cannabinoid-based medicines to go through testing.
In fact, GW Pharmaceutical made history when it received FDA approval last year for its marijuana plant-based prescription drug, Epidiolex. For the first time ever both the FDA and DEA essentially gave in to the idea that marijuana can be used as medicine.
The DEA even listed GW Pharmaceutical’s new drug as schedule 5 on the controlled substances list, making it the least likely for abuse and allowing clinical research to continue for the first time. This will undoubtedly bring significant investment from entrepreneurs and pharmaceutical giants alike.
Tech
From cannabis ERP systems to WeedMaps cannabis technology companies are taking over.
In today’s modern, tech-obsessed world any industry that sees consistent growth is immediately inundated with a million new tech start-ups hoping to squeeze a profit out of growing businesses.
One great example is the ‘uber of weed’, Eaze, which was valued at over $800 million back in 2019. The Snoop-Dogg backed company has been fighting lawmakers and the likes of Google in order to make its name in the marijuana business since 2016.
Thus far Eaze has raised an incredible $166 million in funding and despite consistent cash burn, they continue to offer cannabis delivery services around the country. In fact, Eaze has completed more than 5 million deliveries since inception. Clearly, the cannabis tech industry is set to witness continued growth as cannabis prohibition comes to an end.
Tourism
If I would have told you that pot tourism would be a multi-billion dollar industry two decades ago you would have laughed in my face. These days, it’s no joke.
In fact, according to CBInsights, Colorado has experienced a 51% uptick in cannabis tourism since 2014, drawing in roughly 6.5M cannabis tourists annually.
Even the New York Times has begun to recognize the growing value of cannabis tourism, publishing an article at the end of 2019 entitled, The Rise of Cannabis Tourism, which elaborates the growing potential of marijuana tourism to stoke growth in the hospitality sector.
Marketing and Advertising
Whenever a new industry blossoms marketers and advertisers begin to salivate. They know the money train is coming into town. The cannabis industry is no different. In fact, according to Billboard Insider, the rise of the cannabis industry could generate as much as $3B in advertising demand by 2025.
One example of this growth can be seen in WeedMaps recently announced marketing campaign, “Weed Facts”, that is set to display positive statistics and information about cannabis on hundreds of billboards throughout the country.
The ‘Weed Facts’ campaign is really just the beginning, as the cannabis industry matures and federal regulations continue to relax advertisers and marketers will surely take advantage.
The end of over a hundred years of marijuana prohibition in the U.S. and abroad has been great for business, and not just in the cannabis industry. From the marketing industry to pharmaceuticals, the legalization of cannabis has been good for the bottom line of companies around the globe.