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Cannabis Direct to Home Delivery Insights First Half of 2020

2020 has been an exciting year of growth for the cannabis industry despite challenges across California. As a result of the stay-in-place orders in the state, consumers were looking for 2 things: new ways to access cannabis and discovering new ways to cope by trying cannabis. Cannabis was deemed an essential business in March, and since then Driven’s ecommerce and delivery platforms ganjarunner & Budee have been able to help many medical and recreational consumers. Driven has benefited from increased demand from delivery services and has seen substantial month over month growth since March.


We’ve compiled a few trends and insights that are important for the industry as we move through 2020 and beyond. Keep reading to learn more about the top cannabis categories, summer 2020 trends, and deep dive into our fastest growing industry.


With all the working from home activity across California, we have seen some shifts in order and delivery times. People are turning to cannabis for creativity, focus, stress and sleep more than ever and social acceptance is no longer after work or on weekends. In March and April, non-peak hours became busier as people were furloughed or working from home. Orders spread more evenly throughout the day vs the after-work boom.


PANDEMIC BUYING TRENDS:

17% of the orders are placed before noon

20.7% of orders are placed after 8pm

Our busiest hour for orders placed is 8-9pm


While we have seen growth across California, we have noticed a disproportionate increase in the below geographies. Must be the challenges our competitive friends are facing in some of their strongholds. Turns out, being a licensed cannabis retailer isn't always Eaze’y :)


Where we acquired:

41% of new customers were acquired in Northern California

16% of new customers were acquired in the Bay Area



Demographic shifts fueled by changes to the economy and employment were meaningful in the online cannabis industry. New consumers accounted for more than 33% of all orders in the month of June and that trend is continuing throughout the month of July. More women are joining the community, now representing 40.6% of our customer base. The launch of the BrandBudee program and widget brought new insights into the more sophisticated and loyal consumer that opted to purchase directly from the brand's website (which is enabled by our technology and network). These consumers carried higher affinities to things like music, movies, and technology which is a shift from the general audiences who are still focused on more economical themes such as job hunting and gaming. We’ve seen a 5% increase in buyers between the ages of 55-64 and an 8% increase in buyers between the ages of 18*-24 up from 2019.


Some things never change… Our leading categories remain as normal at a macro level but there are major shifts among the new consumer group that we predict will have a material impact to this list as early as Q4.


Top categories (based on the number of products sold):

  1. Flower

  2. Cartridges

  3. Edibles

  4. Pre-Rolls

  5. Concentrates


While we have seen a slight downward trend with average order values (AOV) the largest revenue producers remain consistent. Sometimes it’s easier to snack on a gummy during a Zoom meeting than it is to roll up your favorite flower. ;)


Top 5 categories (based on total sales value):

  1. Flower

  2. Cartridges

  3. Concentrates

  4. Pre-roll

  5. Edibles


Well if the heat in California doesn’t increase your consumption levels of these most improved categories, maybe it’s time to broaden your palate and see what our emerging category brands are able to produce these days. Driving this growth is our new consumer category and our work from home category (professionals between the ages of 25 and 35) along with an increased appetite from our female audiences which now represent 40.8%, up 5.2% from last year.


Top categories of the summer: % increase in sales from May to June

  1. Beverages grew by 26.10% - There’s nothing like an ice-cold adult beverage in the summer

  2. Vape sales increased by 2.11%

  3. Edibles decreased by 12.94%

  4. Pre-rolls sold 25.98% more in June than May. Did you like rollin’ doobies in June?


Consumers are looking for the perfect blend of effects these days, which also trends more towards the working adult segment. The hybrids continue to see higher volume than dominant strains as consumers look for less aggressive effects during those Zoom meetings, being home with the family, or a light stress reliever. That trend continued across many categories this year with the emergence of single-serve beverages and disposable vape sales, which are top options for newer users looking to try something easy.


TOP STRAINS

Categories with Hybrid dominance as the highest quantity sold:

  • Beverages

  • Cartridges

  • Concentrates

  • Flower

  • Pre-Rolls

Edibles topped the list for most Indica dominant category as more and more consumers turn to cannabis as part of a sleep program. After all, who doesn't like a little candy or chocolate before bed!


Beverages, Driven’s fastest-growing category:


Although beverages have not found their place on the list of top-selling categories this year yet, the category is making its way through 2020 with much promise for exceptional results come year-end. Beverage orders from May to June increased 21.58% month over month, a 26.10% sales value increase in beverages alone in June. At the rate beverages are moving so far in July we estimate this month continuing the upward trend with estimates of us ending the month 15.68% higher than June! This summer we also started deploying electric refrigeration systems in the fleet which is helping drive the increased volume as the only thing people are liking more than a good single serve cannabis beverage, is a cold single-serve cannabis beverage. We anticipate having the new coolers deployed statewide by the end of August.


COLD DELIVERY MATTERS: 77% of our customers said they would be more likely to order beverages if they were delivered cold. Especially in under 60 minutes!

To round out this industry and category performance update, we would like to thank our more than 400 employees, 55 participating brands, and shareholders for being a part of the journey with us. The growth of the business continues to exceed forecasts while the operations continue to see improved performance on delivery and unit economics.

See our month over month growth below…



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