Canadian cannabis industry trends move fast. Get updated on the latest product and consumer trends with data from Brightfield Group's cannabis consumer insights platforms. Staying on top of product trends and changing behaviors of Canadian cannabis consumers is how brands gain a competitive edge in the face-paced cannabis space.
Background: Canadian Cannabis Market Data
Canada is a leader in cannabis legalization, becoming the second country to legalize recreational cannabis use nationwide in October 2018. The Cannabis Act governs the production, distribution, sale, and possession of cannabis, and has allowed provincial cannabis markets to open for adult, recreational use.
Each Canadian province and territory has its own legal framework for cannabis, affecting the availability, pricing, and product offerings of cannabis from one province to the next. Despite these differences, the Canadian cannabis market as a whole continues to experience significant growth, with a wide range of players and opportunities across the country.
As a whole, the Canadian cannabis market is expected to continue growing through 2027, as forecast in Brightfield Group’s 2022 Canadian Cannabis Market report. In 2023, the market is expected to be worth $6.4 billion, with the biggest markets being Ontario and Alberta. Ontario is a particular province of opportunity as it is also expected to lead growth in 2023, with a provincial compound annual growth rate of over 20%.
Canadian Cannabis Consumer Highlights
- Consumer Product Use Trends
The Canadian cannabis consumer market is highly diverse and made up of users who consume cannabis in a variety of ways, from toking to eating, and topical applications too.
Flower and pre-rolls are the most-used product types, as reported by Canadian cannabis consumers. In 2022, 7 in 10 cannabis users were enjoying flower and/or pre-rolls. Milled flower is a product type within this category that’s gained attention in recent quarters. In the second half of 2022, 2 in 10 flower/pre-rolls users said they were enjoying milled cannabis.
Using Brightfield’s Distribution Trends, we can tap into cannabis store data to see what customers are looking at when they get to a menu. Flower is still the most common product in a dispensary. Over the past six months, flower and pre-roll products have increased their share of shelf. In March 2023, 48% of products on cannabis store menus were a flower or pre-roll product.
Despite being the most classic form of cannabis, flower has seen significant innovations in Canada over 2022. First, we saw the rise of infused pre-rolls on menus, appealing to the consumers looking or ultra-potent THC experiences. In the latter half of 2022 and into 2023, pre-milled flower innovations are hitting cannabis store shelves, with pre-milled options in aroma-specific packs as well as infused ground flower.
Gummies are the second-most popular product type among Canadian cannabis users. The product type is still limited to 10mg per serving, which is restrictive for individuals that enjoy higher doses. However, the small pack sizes do make Canadian gummies an inexpensive add-on to an order.
Drinks are an elusive product type that cannabis brands aspire to tap into. The closest cannabis product to alcoholic drinks, cannabis drinks are thought to be the next frontier in drinkable, mind-altering beverages. The trend is catching on in Canada faster than in the U.S., as we see more users reaching for drinks in Canada than in the U.S. In Canada, drinks use increased from 2021 to 2022, while in the States, cannabis beverage use declined.
- Opportunity with Cannabinoids
CBD is integrated within the country’s cannabis program, unlike in the U.S., providing consumers with full view of legal cannabinoids together on cannabis store shelves.
THC-dominant cannabis use is the most commonly enjoyed type of cannabis, but still around one-fifth of Canadian cannabis consumers use CBD-only products. However, 60% of all users enjoy a THC:CBD balanced or CBD-dominant product.
There’s an opportunity in Canada to incorporate CBD plus other minor cannabinoids into products. Canadian cannabis consumers tell us they’ve purchased minor cannabinoids like CBC, CBN, and CBG, as well as other psychoactive cannabinoids like HHC and delta-8 THC.
Still, only a small segment of consumers report purchasing these minor cannabinoids while a significant proportion of the cannabis consumer population is aware of minor cannabinoids. The brands already incorporating other cannabinoids into their formulations are ahead of the curve and helping more consumers learn about these cannabis compounds.
- Casual Cannabis Usage Occasions
The occasions of cannabis use that have maintained their popularity at the end of 2022 reveal the “new normal” of cannabis after the return to in-person socializing post-pandemic.
In Canada, cannabis normalization is further along than in the United States. By 2016, over two-thirds of Canadians were in favor of legal cannabis. It took until 2019 for 2/3rds of Americans to agree with U.S. legalization. Robust unregulated markets and a different history with “reefer madness” propaganda have also accelerated Canada’s normalization of cannabis.
However, in the years since legalization in Canada, we have seen a new phase of cannabis normalization. The occasions people decide to use cannabis point to how accepted the plant is becoming. From Q1 2021 to Q2 2022, nearly all occasions of cannabis use Brightfield tracks saw an uptick. Citizens were returning to their lives outside the home as pandemic-era restrictions loosened, and their cannabis use came with them.
However, at the end of 2022, we saw a leveling off – and even a slight decrease- in most usage occasions. The occasions that rose and continue to maintain popularity among Canadian consumers include “with everyday meals,” “just after waking up,” and “at dinner parties.” Casual cannabis use in the morning or with dinner at home or with friends shows how integrated the plant is becoming in consumers’ lives.
As cannabis use becomes accepted at more social occasions, the market for cannabis products will continue to expand. This means that brands can tap into new revenue streams by offering cannabis products that cater to specific social settings.
Cannabis consumers are an ever-evolving group whose needs change with each phase of industry growth. Keep a competitive edge with consumer insights that dig deep into how, why, and when Canadians incorporate cannabis into their life.
Get in touch with Brightfield to learn more about our consumer insights platforms