NetworkNewsWire
Editorial Coverage: On election day this year, four more states
voted to
legalize the recreational use of cannabis, bringing the total
of states that now allow recreational cannabis use to 15. This
growing acceptance of cannabis, and more specifically CBD,
which is now legal in all 50 states, has sparked an explosion
of new CBD-infused products and brands within the consumer packaged
goods ("CPG") space. Estimates about how large the legalized
cannabis market may grow vary widely, but a Lido
Consulting report notes that the total addressable cannabis
market ("TAM") could potentially hit $1 trillion in global economic
impact by 2027. Seeing almost unlimited potential, companies are
rushing to take advantage of the massive opportunity. Continuing
its aggressive growth strategy, The Alkaline Water Company
Inc. (NASDAQ: WTER) (CSE: WTER) (Profile) entered the CBD space with the
launch of its A88CBD(TM) brand. Already nationally recognized for
its premium bottled water and flavor-infused water, Alkaline
Water now features a full line of CBD-infused and topical products.
After posting record sales earlier this year, this strategic push
into the lucrative CBD market could propel the company to new
records. Also quick to see the opportunity, Constellation Brands Inc. (NYSE: STZ)
recently exercised
warrants to purchase additional shares of Canopy Growth
Corporation (NASDAQ: CGC) (TSX: WEED), increasing its
stake in the Ontario cannabis producer to more than 38%. In a nod
to the value of having CPG expertise, Aurora
Cannabis Inc. (NYSE: ACB) (TSX: ACB) has appointed Miguel
Martin, an international CPG executive, as its chief commercial
officer. And Charlotte’s Web Holdings Inc. (OTC: CWBHF) (TSX:
CWEB) has announced a
collaboration between its CW Labs science division and the
University at Buffalo's Center for Integrated Global
Biomedical Sciences to advance hemp cannabinoid science through a
research program that provides a better understanding of the
therapeutic uses and safety of cannabinoids.
- Growing acceptance of cannabis, specifically CBD, has
sparked explosion of new CBD-infused products, brands within the
consumer packaged goods (CPG) space.
- WTER’s A88CBD product line meets stringent requirements as CBD
becomes more mainstream.
- Well-financed suitors may well be interested in The Alkaline
Water Company given its unique niche strength, appeal.
Click here to view
the custom infographic of The Alkaline Water Company
Inc. editorial.
A Massive Consumer Base
“Pause to consider,” the Lido Consulting article observed, “a $1
trillion market in eight years while currently there is not a
single company in the space that generates anywhere close to $500
million in revenue. That fragmentation, and the wholly unique
phenomenon that a black market with an existing — and massive —
consumer and patient base is transitioning to a regulated market,
is what makes cannabis such a compelling opportunity.”
That demand has only increased in the past year, with the
COVID-19
epidemic fueling online sales. In fact, one study reported that
every dollar spent on email marketing in the CBD industry resulted
in almost $40 in
revenue. And research by the Brightfield Group shows that
roughly one-third of the CBD consumers surveyed indicated they are
planning to buy from online retailers rather than in-store during
the pandemic, while nearly 50 percent say they will stock up on
supplies if they believe there is going to be a shortage.
The industry seems primed for a leading company to offer a
comprehensive line of CBD-infused and topical products — and emerge
as a trusted brand. Who better to step into the spotlight than an
innovative company that has already firmly established its ability
to quickly identify and deliver on consumer needs and market
opportunities?
CBD Attracts New Wave of Entrants
Already a well-respected national beverage brand, The
Alkaline Water Company Inc. (NASDAQ: WTER)
(CSE: WTER) is committed to building a similar reputation
in the CBD sector. With those high standards in mind, WTER ensures
all its A88CBD products are formulated in GFM facilities; use the
highest-quality, lab-tested CBD from a trusted source; and follow
rigorous quality control measures to establish consistency.
These stringent requirements are essential as CBD becomes more
mainstream, attracting a new wave of entrants. Large national
retailers are actively looking to add quality CBD products to their
shelves, but these distributors have stringent requirements.
Smaller cannabis producers and new brands with limited resources
lack the resources to provide such high-quality products. However,
their weakness is The Alkaline Water Company’s strength.
As a trusted brand, WTER and its best-in-class A88CBD brand
offer precisely what retailers are looking for: superior quality
topicals, oils, capsules, tinctures and gummies.
Capturing Share in Large, Growing Markets
The Alkaline Water Company is deeply committed to its A88CBD
line, launching five
category-leading items during Q2 FY 2021. “These products,
which include our delicious lemon-lime CBD water, vegan gummies,
zero-calorie powder packs, all-natural bath bombs and cruelty-free
deep relief cream, complement our existing product lineup,” said
WTER president and CEO Richard A. Wright. “Our robust product
lineup effectively positions us to capture share in the estimated
$20 billion-plus, hemp-derived consumer products market.”
Intent on capturing as much of the growing market as possible,
WTER is strengthening both its online and in-store presence. A88CBD
products are currently available on the company’s
direct-to-consumer e-commerce site at www.A88CBD.com and in approximately 400 retail
locations, including Elevated Wellness CBD, CBD Emporium, Alchemist
Kitchen, Pure CBD, and select Vitamin Plus locations; the products
are also available online at Amazon, CBD.co, healwithnature.com and
DirectCBDOnline.com. Having both a vibrant online presence and
robust retail locations is essential for companies committed to
increasing sales in the CBD space. With that in mind, Wright also
noted that the company is looking to continue to expand its online
presence through unique digital marketing strategies and leverage
its existing brick-and-mortar footprint for its A88CBD portfolio of
products.
“We are in active discussions with over 9,000 retail locations
to take on our products over the coming 90 days,” he said during
the Q2 financial webcast. “With an in-demand portfolio of
offerings, a strong partner network, and an established retail
base, we are taking aggressive actions to capture share in the
large and growing retail trades we currently serve and greenfield
opportunities in the CBD and hospitality and foodservice arena.
Additionally, our e-commerce sites continue to exceed our
expectations and provide another growth area driven by shifting
consumer behaviors. We also expect the multi-year health and
wellness trend to accelerate coming out of the COVID pandemic and
anticipate our lifestyle brands to benefit due to our sales and
marketing efforts made this year.”
A Strong Candidate Fills Unique Niche
A88CBD is only a piece of The Alkaline Water Company’s strategic
business approach. The company’s flagship product, Alkaline88(R),
continues its strong performance in the beverage world,
contributing to the company’s record sales reported in October.
“Our family of brands — Alkaline88, A88 Infused and A88CBD Infused
— include a growing portfolio of products that are in demand and
resonate with consumers,” Wright said.
A recent Proactive
Investor article noted that “well-financed suitors may well be
interested in the Alkaline Water Company given its unique niche.
After all, a Neilson report ranked Alkaline88 as ‘one of the
fastest growing’ value-added waters in 2019. It also noted that
[the company] has built a ‘national retail footprint’ and extended
its lifestyle brands into other consumer packaged goods
categories.”
WTER’s consistency and commitment to quality, along with its
unique variable-cost business model and growing portfolio,
certainly bode well for the company, making it a strong candidate
for a savvy beverage or cannabis brand looking to strengthen its
position in the growing sectors.
Evaluating, Seizing the Opportunities
With a trillion-dollar industry projection providing incentive,
WTER isn’t the only CBD company to strategically evaluate — and
seize — the opportunities.
Back in 2017, Constellation Brands Inc. (NYSE:
STZ), a leading beverage alcohol company, signed an
agreement to acquire a 9.9%
minority stake in Canada-based Canopy
Growth Corporation (NASDAQ: CGC) (TSX: WEED). The
investment was consistent with Constellation Brands’ long-term
strategy to identify, meet and stay ahead of evolving consumer
trends and market dynamics, while maintaining focus on its core
total beverage alcohol business. Constellation’s move earlier this
year to significant increase that interest signifies the company’s
recognition of possibilities within the industry.
“While global legalization of cannabis is still in its infancy,
we continue to believe the long-term opportunity in this evolving
market is substantial,” said Constellation Brands president and CEO
Bill Newlands. “Canopy is best positioned to win in the emerging
cannabis space.”
Aurora
Cannabis Inc.’s (NYSE: ACB) (TSX: ACB) new chief
commercial officer has deep, diverse experience in consumer
packaged goods, highly regulated industries and the U.S.
cannabinoid industry. “Miguel is a highly experienced executive
with an exceptional track record of performance in a number of
consumer products categories,” said Aurora executive chairman
Michael Singer. “The Aurora Board and I firmly believe that under
Miguel's leadership, Aurora's strategic direction going forward
will be characterized by leading market performance, sustainable
growth, profitability and value creation for shareholders."
Charlotte’s Web Holdings Inc.’s (OTC: CWBHF) (TSX:
CWEB) new scientific
initiative with the University at Buffalo's Center for
Integrated Global Biomedical Sciences includes collaboration on a
global program to advance cannabinoid sciences implementation
research and safety for both supplement and biomedical use of
cannabinoids. The objective of the partnership is to identify
optimal approaches to advance the safe use of
cannabinoid-containing products and identify the gaps in current
knowledge.
This growing acceptance of cannabis, and specifically CBD,
isn’t likely to slow and has sparked the explosion of new
CBD-infused products and brands within the consumer-packaged goods
("CPG") space. Industry leaders in this explosive growth market are
positioned for exponential growth.
For more information about The Alkaline Water Company, please
visit The Alkaline
Water Company.
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