While some 12,580 legal weed shops have sprouted across 42 U.S. states, a surprising truth lurks beneath this surface of retail green: the illicit cannabis market continues to reign supreme.
Despite the artfully displayed products and helpful budtenders at the cool legal dispensaries, it seems a large majority of Americans are still turning to their OG weed sellers.
Why is that? For starters, it boils down to a simple equation: price + convenience. The former is usually way lower and the latter, more often than not, involves that OG friend coming right to your front door.
A new report from New Frontier Data paints a stark picture. In 2022, illicit cannabis sales raked in a staggering $74 billion compared to the $28 billion that went to legal shops.
Even with over half of Americans now having legal access to medical or adult-use cannabis following Ohio’s November legalization, the black market is projected to rule until at least 2030.
“Meanwhile, the legal cannabis market is embroiled in competition amongst itself to serve the pool of consumers who already rely on regulated channels,” according to the report.
But it’s not a lost cause. Legal shops can bridge the gap, if they play their cards right.
Education And Outreach
The report suggests the need for more information about cannabis and targeting new potential users, such as older adults and women who are increasingly interested, but myths and safety concerns seem to be keeping them hesitant.
Educational initiatives dispelling the myths and highlighting medicinal benefits could be the key to unlocking this untapped market. Social media, community outreach, and even Reddit forums could help reach a wider audience as traditional advertising like TV is not a thing just yet.
Location, Location, Location
Access can be an issue, especially for seniors. Creating more conveniently located retail shops and user-friendly online platforms could also go a long way to solving the access shortage.
“Frequent consumers who primarily source from dealers live disproportionately in urban areas, where they may or may not have convenient transportation to dispensaries,” per New Frontier’s analysis that was first reported by Green Market Report’s Adam Jackson.
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