Amazon.com Inc.(AMZN) and eBay inc. (EBAY), two of the world's leading e-commerce retailers, are particularly well-positioned to benef...
Amazon.com Inc.(AMZN) and eBay inc. (EBAY), two of the world's leading e-commerce retailers, are particularly well-positioned to benefit from the expanded market of the Convention on Biological Diversity, a non-intoxicating substance in marijuana plants that are seeing rapid sales growth.
In a detailed 106-page study, Quinn states that products containing the Convention on Biological Diversity "are now available through increasingly diverse sales channels, including Amazon, Sephora, and Neiman Marcus".
They estimate that retail sales of CBD products in 2018 ranged from $ 600 million to $ 2 billion and will grow to $ 16 billion by 2025, based on what they say are conservative assumptions: a 40% increase in use from part of consumers, in addition to spending less than $ 2 per day per consumer.
More opportunities for additions to the Convention on Biological Diversity
About 7% of the 2,500 US adults surveyed in January 2019 use CBD supplements
Retail sales for the Convention on Biological Diversity are expected to exceed $ 16 billion in the United States by 2025.
Role of e-commerce
The report predicts that e-commerce is an important distribution channel for CBD products. These belong to a broader category called personal care, beauty, vitamins, and dietary supplements, which Quinn hopes to enjoy online sales.
Driving this growth is the growing number of jurisdictions that have either abolished or do not enforce the legal ban on marijuana.
This, in turn, facilitates the growth of food supplements that contain the Convention on Biological Diversity Mikhail Kogan, medical director of the George Washington University Center for Integrative Medicine, told the Washington Post, "This is a really strong ship.
Importance for Investors
What is the Convention on Biological Diversity?
The two main chemical compounds in marijuana, or cannabis, are THC and CBD. THC is an intoxicant that decades of research suggests may also be effective against pain, nausea, anorexia, and other diseases.
The Convention on Biological Diversity, which is believed to have no impact on the human body, has been the subject of increasing research over the past 10 years. Evidence suggests it may be useful in treating epilepsy, anxiety, schizophrenia, heart disease, and cancer, according to Mail. Quinn cautions that while THC's effects on the body are well established, much is still unknown about it. CBD and no specific future have been identified.
CBD is part of an important e-commerce category called High Growth Potential Consumables, Quinn says, "Consumables remain a very low-penetration e-commerce sector amidst the gradual change on the Internet." Online consumer sales in the United States in 2018 are estimated to have been $ 51 billion, or 11% of total spending in this category.
A huge Amazon marketplace
In an Amazon customer survey, Quinn found that every month in the fourth quarter of 2018, 19% of Prime shoppers purchased at least one personal care product, and 15% purchased at least one vitamin or supplement product. In more than 30 other product categories, only 12% of Prime buyers have purchased anything. A similar trend was recorded among non-large buyers, with significant values equal to 13%, 10%, and 8%.
Amazon's growing physical footprint. Amazon's Whole Foods Markets, a grocery chain with approximately 470 locations, is another potential sales channel for CBD products, and the company's expanding physical presence also includes Go stores and libraries. Hull Foods offers a delivery service. in two hours for many components in 63 cities representing 50% of the US population and 66% of US GDP, plus roadside delivery service in more than 20 markets. It's unclear when CBD products will appear on these physical channels, but Quinn calls them "engaging ways to reach new customers".
Amazon may introduce CBD under its brands. The report notes that Amazon, including Hall Foods, has a large and growing private label.
While this may initially threaten established CBD companies, "the wide availability and acceptance by a retailer like Amazon can also help drive widespread adoption of CBD products and thus provide industry benefits in your set."
