A rising number of Detroiters may be trying something new this holiday thanks to growing acceptance of CBD among consumers and advertisers. And that’s a good thing for the local economy and many small businesses fueling CBD growth.
The market for CBD products has exploded in recent years and is expected to exceed $24 billion by 2023, according to the Brightfield Group, a Chicago-based analytics and market research firm for the legal CBD and cannabis industries.
Michigan is among the top 10 fastest-growing CBD markets in the United States, according to numerous reports.
With many Detroiters among the 40 percent of U.S. adults interested in trying CBD, some experts believe that CBD will soon become as common as aspirin in households across Metro Detroit. There’s also significant growth among CBD retailers, such as Mother Earth Natural Health, which Crain’s recently reported is expecting year-over-year sales growth of 300 percent to 400 percent this year.
Fueling growing acceptance and awareness of CBD brands is Larry Berg, a longtime Detroit-area executive, Crain’s 40 under 40 cohort, former senior VP of $2 billion marketing services company Valassis and founder of privately held CBD Marketing Hub, an Ann Arbor-based company specializing in the CBD market. Berg founded the company August 2018.
His company is among those helping new CBD businesses move from Main Street merchants to the larger economy via highly targeted marketing campaigns like the many that took place over Cyber Weekend, which includes Black Friday and Cyber Monday promotions.
Recently, Berg’s CBD Marketing Hub, along with its partners CBD.io and Target Insyght’s nonprofit arm Insyght Institute, released the first-ever CBD Confidence Survey, which found that 55 percent of the survey’s respondents planned on being involved in Black Friday and/or Cyber Monday specials.
That’s important, according to Berg, who notes that the stats signal growing acceptance of CBD’s place in the mainstream market, its positioning among consumer-packaged goods and, most importantly, advertisers’ willingness to accept CBD ads.
„As the CBD landscape continues to grow, companies are finding new avenues and media to participate in this growth,” Berg said. „Cyber Weekend was an opportunity to launch, educate and engage with consumers and bring CBD companies to the forefront so people see the industry as it matures.”
Digital sellers like CBD Marketing Hub clients saw a huge lift in activity as a result of Cyber campaigns, Berg said.
„In a three-day period alone, we helped our clients reach 21.2 million consumers,” Berg said.
Companies say their 2019 Cyber Weekend events started in the hours before or on Thanksgiving and continued through Monday and even into the next week. Cyber Weekend helped CBD companies gain exposure in what retail-industry analysts call the kickoff weekend to holiday spending. They also saw traction in starting relationships with curious consumers who dipped a proverbial toe in CBD products because of discounts or special offers.
„People get excited about our Cyber Weekend sales because we bring our prices down to half,” said Jared Ballard, brand director for Hemplucid, a Utah-based CBD company that is concentrating efforts in high-growth markets like Michigan. Ballard said Hemplucid has been doing Black Friday and Cyber Monday advertisements for four years.
„We find we get a huge return rate from customers, which has been fantastic,” Ballard said. „Customers come in with these sales, they get to know our product and they get a feel for who we are as a company. We retain between 75-80 percent of them (after the sales).”
More CBD in holiday packages and in homes throughout Metro Detroit is potentially a business opportunity and good news for Detroit-area small businesses and a clear signal that there’s growth ahead.
Editor’s note: In a news release, Gov Gretchen Whitmer stated that she sees hemp farms as not just an agricultural opportunity but a potential business creator. As of early November, the state issued 572 grower licenses and 433 processor-handler licenses.
Mark S. Lee President & CEO, The LEE Group, a Plymouth-based, strategic consulting firm. You can hear him “In the Conference Room”, Sundays, 11 a.m.–1 p.m., on 910AM. You can also hear “Small Talk” podcasts at leegroupinnovation.com.