February 7, 2025
Harley-Davidson’s struggles in the past decade offer a cautionary tale for the marijuana industry.
From 2014 to 2023, Harley-Davidson’s sales plummeted by 37%, driven by limited options appealing to new entrants and evolving market demands.
Efforts to attract new riders, such as women, stumbled because of heavy, costly bikes ill-suited to their needs.
Similarly, the state-regulated marijuana market is contending with slowing sales growth, intense competition and shrinking margins.
A key challenge is the lack of new consumer entrants, even as cultivation efficiencies have ramped up.
This mismatch has resulted in a surplus of inventory, driving down prices and intensifying market pressures.
Since the legalization of the first adult-use marijuana markets in Colorado and Washington state in 2012, the industry has experienced remarkable growth in public acceptance and number of consumers.
However, the initial rapid expansion is now decelerating in many markets, and new recreational and medical users are trickling in at a slower pace.
This trend persists despite growing evidence of the plant’s relative advantages over alcohol and prescription medications.
For sustainable growth, the cannabis industry must pivot from an over-reliance on THC potency as a selling point and invest in robust consumer-choice infrastructure.
What is consumer-choice infrastructure?
In the cannabis industry, consumer choice infrastructure encompasses the systems, products and services that empower consumers to make informed and personalized decisions.
It includes offering a diverse range of product types – flower, edibles, tinctures and topicals – supported by clear labeling with detailed information such as cannabinoid content and terpene profiles.
It also involves creating retail environments and education initiatives that guide consumers toward products tailored to their unique needs.
A strong consumer-choice infrastructure fosters trust, satisfaction and loyalty by addressing the full spectrum of consumer preferences and experience levels.
Currently, many cannabis retailers and manufacturers are striving to educate consumers through pamphlets and conversations about cannabinoids, terpenes and the “entourage effect.”
However, when consumers seek products combining multiple cannabinoids and other beneficial compounds, budtenders often struggle to deliver because of an oversaturated market focused on high-THC products.
Shifting focus to attract new consumers
A recent report from the California High Potency Cannabis Think Tank underscores the risks of high-THC products, including their association with marijuana-use disorder and other adverse health outcomes.
Among its recommendations are limits on THC potency, public education campaigns and retail regulations to encourage lower-potency options.
These recommendations might foreshadow regulatory trends across broader markets, making it crucial for marijuana retailers to evaluate their product offerings and prepare for potential shifts.
One strategic pivot is moving away from the “stoner bro” culture of high-potency products to a more approachable, balanced product mix.
This shift could attract untapped markets, particularly wellness-focused consumers and demographics still hesitant after decades of stigmatization from the war on drugs.
Adults who are 55 and older represent a significant growth opportunity.
Despite their interest in wellness-oriented cannabis solutions, this demographic remains underrepresented in consumer data, suggesting pent-up demand.
To capture this market, the industry must develop products and educational services tailored to the needs of older consumers.
Products that address wellness goals such as pain relief, improved sleep and maintaining an active lifestyle are more likely to resonate than ultra-high-THC offerings that can overwhelm inexperienced users.
Stories abound of curious newcomers being deterred by unpleasant experiences with overly potent products – a missed opportunity the industry cannot afford.
The path forward
Much like Harley-Davidson’s challenge of adapting to a changing rider demographic, the cannabis industry must rethink its approach to attracting new consumers.
By prioritizing accessibility, balanced products and education, marijuana companies can open the market to a broader audience.
As the industry matures, addressing the wellness needs of pragmatic, health-conscious consumers will not only expand the market but also position cannabis as an essential component of modern wellness.
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