Cannabis companies hope to be rolling in green this 420.
Tuesday is April 20, aka the unofficial stoner holiday 420, and many cannabis growers, dispensaries and delivery growers are anticipating a bump in business as more states legalize recreational marijuana, and cities and states continue to reopen now that more than half of American adults have received at least one dose of a COVID-19 vaccine.
Cannabis software firm Akerna Corp recently reported that it expects national cannabis retail sales to hit $95 million on 420, with total 420-related sales ultimately hitting $370 million in the U.S. According to Akerna, the average order will be $10 higher than usual as customers spend $105 apiece on average, with buds or flowers accounting for about half (49%) of all legal sales, followed by vape pens and cartridges. And the number of cannabis products purchased is expected to increase 30%.
That’s not the only optimistic outlook. “We estimate that during the week of April 20 this year, average daily sales in U.S. recreational markets will increase by at least 30% over the previous four weeks,” Cooper Ashley, a data analyst at cannabis business intelligence firm Headset, told MarketWatch over email.
Many cannabis companies enjoyed a bump in business early last year as the pandemic didn’t just see people panic-shopping for toilet paper and hand sanitizer — some also began stockpiling marijuana and cannabis products.
And people buying more marijuana for April 20 isn’t just an urban myth. Despite the pandemic canceling 420 events and keeping many shoppers at home, online cannabis marketplace I Heart Jane saw last year’s 420 sales more than double compared with the average day in 2018 and 2019, for example, and the week of April 20 itself also saw a 35% increase in sales compared with the typical week. Online platform Lantern, which delivers cannabis products in Massachusetts, Michigan and Colorado, saw sales peak the first and third weeks of April 2020, while its sales during the week of 420 rose 180% from the week before.
Mike Bibbey, vice president of marketing at Ethos Cannabis, told MarketWatch that the company has generally seen average daily sales volume nearly double on 420. And Lisa Schaefer, director of marketing at cannabis cultivator Mayflower, said that the 420 season is a high time to attract new customers. “For instance, our Mayflower recreational dispensary in Worcester, Mass., saw an 83% increase in new customer acquisition on April 17, the day of our 420 Event this year,” she said. “Perhaps all the hype of the holiday inspires the canna-curious to give it a try!”
But some companies such as Leaflink saw sales in the run-up to last year’s 420 actually dip; it believes this is because many people had already stockpiled enough weed the month before as lockdowns began. Cannabis marketing platform Springbig only saw a 50% increase in 420 sales last year, compared with a 200% increase in sales on April 20, 2019, which it also blamed on the coronavirus.
Springbig believes that retailers “can expect a greater increase in 420 sales this year similar to 2019, due to the fading of COVID-19.”
Sixteen states and Washington, D.C. have legalized recreational marijuana, most recently New York and New Mexico. But cannabis-related businesses still struggle to access financial services at U.S. banks. While the House passed a cannabis banking bill on Monday, its future in the Senate is murkier.