CBD industry faces ‘existential crisis’
“The CBD industry is always in motion. It's always changing, moving, fluctuating. Right now, it's really facing an existential crisis where it's trying to determine where it fits in the market,” Gomez said. “Is it really a standalone industry anymore? Is it just another functional ingredient, part of the larger wellness space? Or is it part of the larger cannabis space? We've seen it start to meld into that industry as regulated cannabis expands and hemp-derived THC products have exploded around the country as well. So, it’s certainly always in a state of identity crisis and always in a state of fluctuation.”
Gomez continues by discussing how that identity crisis relates to the 2018 Farm Bill, hemp production and where CBD fits in.
A big part of the conversation around CBD is it's positioning, as it's marketed mostly as a mood and sleep support product. More than 53% of all CBD consumers use the substance for these purposes, and it has overtaken pain and inflammation as key reasons that consumers are using it, Gomez said.
“[Consumers know] they need to be able to take the edge off, but they don't want to be turning to things like alcohol, or they don't want to be turning to things like pharmaceutical products,” Gomez added. “So, it's positioned both to help in a natural way, helping consumers relieve these mental health issues that have skyrocketed during Covid and haven't dissipated.”
Despite gains in the wellness industry, the number of CBD brands has declined in recent years.
“If you have about a $4.5 billion market, but you have to compete with thousands and thousands of additional competitors, it's very difficult to be able to break through that noise,” Gomez noted. “And it’s difficult to be able to make a real impact with your brand.”
Watch the video for the full interview.
