During the last few years, we have seen a significant increase in the number of brands that are focused on the cannabidiol (CBD) market. The rapid increase has saturated the market and has forced brands to innovate to stay relevant.
One of the areas that some CBD companies have focused on in order to differentiate itself from the hundreds of existing brands is the pet market, which has proven to be an attractive avenue for growth.
If you look at the performance of pet focused companies during the COVID-19 pandemic, you will notice that these businesses were some of the greatest beneficiaries of the stay at home orders that were issued earlier this year.
While hundreds of millions of Americans were under state issued stay at home orders, animal shelters were running out of pets that were available for adoption. The increase in the number of Americans families that have a pet has led to growth on almost every metric. From the amount of pet food that is sold to the types of veterinary services that are provided, the pet industry has been a bright spot of a uncertain future.
As it relates to the CBD opportunity for pets, we are bullish on the growth potential that is associated with the vertical. Pet owners have shown a willingness to spend money and this trend has played out on the CBD side of the industry. Today, we want to highlight 3 companies that are focused on the CBD pet market and believe that our readers need to be aware of the trend.
Earlier this month, CV Sciences (CVSI) announced the launch of PlusCBD™ Pet, a full line of hemp extracts formulated exclusively for dogs and cats. The product line is being created with the same type of hemp extracts that are used in CV Sciences’ best-selling CBD products and we will monitor how the product line gains traction.
From a distribution standpoint, CV Sciences plans to expand into the pet specialty channel and food, drug and mass retail channel. According to the Brightfield Group, the US pet CBD market grew to $321 million in sales in 2019 and is projected to reach $563 million by the end of the year.
According to the Brightfield Group, the growth is being driven by pet owners who are looking for natural alternatives to treat pets’ medical ailments (i.e. anxiety, pain, or other serious conditions) that have not responded well to other treatments. The Brightfield Group forecasts the pet CBD market to be a $1.7 billion business by the end of 2025 and we will monitor how CV Sciences is able to penetrate the market.
Charlotte’s Web (CWEB.TO) is considered to be a leader in the CBD industry and has attractive leverage to the pet side of the market. A few weeks ago, we used the company’s paw balm product after taking our dogs on a hike and were impressed with how the product moisturized and strengthen their skin.
When compared to other dog paw balm products on the market, the price of Charlotte’s Web’s product was very reasonable. The premium that was associated with CBD products is one of the main reasons we did not previously purchase CBD products. The saturation on the producer side of the industry is starting to benefit the consumer and this is a trend that we are following.
Hempfusion is a leading CBD brand in the US that is planning to go public in the near future. Although the company does not have a pet CBD product on the market, we expect to see additional products come to market in the near future.
Hempfusion is considered to be an up and comer in the CBD sector and expect to see the brand to continue to generate significant traction. We are favorable on the multi-faceted marketing strategy that was employed by the company to increase market share in the US. Over the long-term, we expect the business to benefit from emerging verticals wishing the CBD sector and will monitor how the story continues to advance.