The Great Alternative: Cannabis Soft Gels

Cannabis retailers work to capture the widest variety of customers possible, which requires providing a diverse range of product options. That is why CannaCraft remains consistently  dedicated to research and development. Creating many types of products across all categories means that we can deliver new items that customers demand.

CannaCraft Soft Gels are one of the most valuable products a retail store can place on their menu. Like all of our products, soft gels have undergone rigorous R&D in order to achieve a highly efficacious formula in a comfortable form factor that customers are familiar with.

In this case study, we will explain:

  1. What CannaCraft Soft Gels are and their differences
  2. Who the Soft Gel customers are and why they buy
  3. How the data shows that Soft Gels drive customers to retailers that stock them

Soft gels spread out on a table

What are CannaCraft Soft Gels? How Do They Work?

With high standards for product development, Cannacraft won’t make any claims on what a product can do until it has been substantiated using available scientific research. We create products and formulations using the entire breadth of scientific knowledge available, from preclinical trials and  anecdotal evidence to double-blind, placebo-controlled clinical research studies. All of these endeavors uncover important information and potential direction on what a product can do for our customers.

Our Director of Scientific Affairs is Matt Elmes, PhD, and he oversees all of our scientific research. Each Soft Gel product produced under the Absolute Extracts or Care By Design brands follows our strict scientific standards.

Designed the Way You Want to Feel

CannaCraft offers two different brands of Soft Gels: Absolute Extracts (ABX) and Care By Design (CBD), with a number of different SKUs from each brand. The primary difference between ABX and Care By Design is that the latter contains a proportional ratio of CBD in addition to THC. You’ll find different varieties, a range of THC potency from 10 to 200 milligrams per serving, and four new effects-based formulations: Focus, Relax, Rest and Relief.

ABX Soft Gels contain THC Cannabis oil. Because of the classification of capsules as “concentrates,” CannaCraft offers ABX Soft Gels  that range from 5 mg up to 200mg of THC per serving. SleepyTime is formulated using THC and a proprietary blend of terpenes designed to achieve the desired effect.

Care By Design Soft Gels range in options:

  • Our Ratio blends are made for precision dosing. Our Ratio Soft Gel capsules are packed with CBD and THC in a convenient supplement that can be taken during the day or evening. We’ve included coconut oil in our formula in order to enhance absorption.
  • Our new Effects line is particularly exciting. Using high-standard scientific substantiation and research, our product development team formulated our new Effects product line using a blend of cannabinoids and terpenes backed by science. The products include Delta-8 and Delta-9 THC, THCV, CBD, CBG, and CBN.

Who Is Buying Soft Gels?

It may come as a surprise, but there are quite a few different types of customers buying our Soft Gel products. They range in age and gender and are shopping for different, often very specific reasons. Demographics don’t reveal a full picture of a customer, so we decided to talk with experienced budtenders to better understand who was buying Soft Gels and why. We’ve also included some of the data we see on generational differences in purchasing Soft Gels.

In general, customers are need-based shopping for Soft Gel products roughly half the time. They’re looking for relief or rest, or they’re dealing with a chronic condition that they believe this product will help. The other half purchase this product because they’re shopping by category and they’re looking for capsules specifically.

Generationally speaking, these customers can be from any age range. Fewer of them are Gen Z, but plenty of them represent all the other generations, with seniors being the most enthusiastic.

Senior cannabis buyer

Senior Online Shoppers

According to 2021 CA Headset Retail Sales Data, the largest segment of cannabis Soft Gel consumers is the senior market. While seniors are perhaps less likely to visit a brick-and-mortar retail store, they do order more online and for pickup. This buying pattern looks to be very similar to how they shop for prescription medications at their local pharmacy.

Many Boomers and Silent Generation customers simply look for a product that is familiar and similar to their other daily medications and supplements. Seniors seek consistency in their products while they manage pain, chronic conditions, or other specific ailments, which may be what is driving them to choose Soft Gels. Customers in this segment report to budtenders we interviewed that they are suffering from chronic pain, anxiety, fibromyalgia, sciatica, and arthritis.

According to Headset, 2021 CA Retail Sales data, this demographic is spending the highest percentage of their cannabis purchases on capsules compared to other generations.

  • Silent Generation: 35% of their cannabis purchase dollars are spent exclusively on capsules.
  • Boomers: 25% of their cannabis purchase dollars are spent exclusively on capsules.

Cannabis curious shopper

The “Canna-curious” Consumer

As more momentum builds around mainstream adoption of cannabis, more first-time or inexperienced consumers enter retail stores trying to find out how to start. Many of the budtenders we spoke with are suggesting these consumers try our Soft Gel products.

Often, these customers do not want  to smoke, instead seeking something easy, discreet, and similar to an edible.

Soft Gels deliver a consistent, predictable dose in a wide range of potencies. This helps budtenders focus on the right dosage for the consumer to get a “low and slow” start to cannabis use.

Bearded man lighting a joint

The OG With a High Tolerance

Most “OG consumers” have extensive cannabis experience. They’re comfortable with flowers and extracts, so you don’t see these customers struggling with the need to have their cannabis resemble their vitamins or prescription medications. OGs want something with a very high potency of THC that they can use when they can’t access their dab rig or smoke a joint.

Because Soft Gels can be classified as concentrates instead of edibles, we are able to provide a high potency option in our ABX line. With a 100-200 mg of THC per serving, we can deliver exactly what these customers need.

Another interesting thing happens in this customer segment. Some OGs are trying to transition away from smoking or vaping. They aren’t moving away from cannabis, just moving away from inhalables. For any customer trying to reduce or completely quit smoking and vaping, the Soft Gels are a no-brainer. They still want high potency effects, just not entering the lungs.

This segment is mostly Generation X and Millennials, although there are also plenty  of the older generations that have been cannabis friendly for a while but are trying to manage their lung health.

Generation X: Headset CA 2021 Retail Sales data indicate while this demographic doesn’t dedicate as many of their dollars to capsule purchases as their older counterparts, they are still outperforming the younger generations and have more money to spend.

18% of their cannabis purchase dollars are spent exclusively on capsules.

  • Millennials and Gen Z: Headset CA 2021 Retail Sales show even though these demographics have less spending cash and are more inclined to smoke or vape, some still exclusively purchase capsules, with their dollars going to capsule purchases at 13.4% and 10%, respectively.

Summary of Customers

Regardless of generation, there are a number of factors that play into why the Soft Gel consumer purchases CannaCraft products:

  1. Capsules are familiar, fitting perfectly into customer’s pre-existing prescription medication or vitamin regimen
  2. Capsules are an affordable option among non-inhalables
  3. They are convenient, with options for consistent dosing, a variety of doses and THC/CBD combos available, are odorless, tasteless, and discreet—great for travel or in public
  4. Non-inhalable consumers are looking for a consistent, affordable cannabis experience
  5. Soft Gels are great for consumers that prefer inhalation but are unable to vape or smoke, and want to maintain a level of THC/CBD in their system

Soft gels in a open hand

CannaCraft Soft Gels are “Trip Leaders” for Valuable Customers

A “trip leader” is a product that consumers initiate a shopping trip in order to obtain. Oftentimes, they are going to a brand’s website to find something specific or following an advertisement, and clicking on the “where to buy” section of that site to find the nearest retailer that offers the product. They will add the product to their cart, along with any other products offered by the retailer that pique their interest.

Looking at the data from the Soft Gels product pages on the CannaCraft website, and tying it to real sales data*, we can see that in the last 6 months, Soft Gels drove over 26,000 customers to purchase at a retailer. The ABX line, with its variety of THC dosing options, is the most popular among those customers at a rate of almost 2:1 to CBD customers.

We know that Soft Gel customers are seeking out stores that carry these specific products, but how valuable are CannaCraft customers in general? A consumer that purchases CannaCraft products shops 13 times a year compared to the California average of 8 times a year; that equals roughly 40% more purchases when our products are involved**.

CannaCraft’s legacy cannabis brand share in the Soft Gels category remains strong. We were one of the first companies to market soft gels in California in 2017.

ABX brand ranks  #1 for Hybrid Soft Gels*** (blend of Indica and Sativa strains). CannaCraft Capsules products from ABX and Care by Design were ranked second in best selling Capsules brands overall in terms of sales dollars in the first quarter of 2021, accounting for 27.5% of total category units sold during the period.

***Headset 2021 Retail Sales / Capsules / Hybrid

Headset Data Graph

Higher Value Baskets include Soft Gels

CC Average Basket Size with and without Soft Gels (2021 Headset CA Retail Sales Data)

Shopping cart and soft gels

Summary: 

  • CC baskets overall are ~$30 larger (+47%) than baskets without CC products
  • CC Soft Gel  baskets are ~$49 larger (+52%) than the average CC basket and ~$53 larger (+58%) larger than CC baskets that do not contain a CC softgel product

California Basket Size Data, June 2021

Metric Value Info
All baskets $64.98 All baskets in CA market, including CC baskets
All non-CC baskets $64.12 All non-CC baskets in CA market
All CC baskets $93.94 All CC baskets in the CA market
Softgel CC baskets $142.95 All CC baskets in the CA market
Non-softgel CC baskets $90.36 CC baskets that do not contain a CC softgel product

The potential to increase sales by carrying Soft Gels is right there in the data. The Soft Gel customer has more discretionary income, and spends more cash on capsules than other cannabis consumers. The CannaCraft consumer shops at a rate of 40% more compared to other customers, and when they shop, they are spending 47% more than the average consumer.

When a retailer carries Soft Gels, CannaCraft customers find them, shop there more often, and spend a higher amount compared to the average customer.

Final Conclusions

  1. The modern cannabis consumer is looking for a diverse array of products to satisfy a wide variety of needs. Even when those consumers typically seek out high potency products, flower and extracts aren’t always enough to satisfy.
  2. Soft Gels fit squarely in the middle of many different customer purchasing journeys and follow product trends that are growing in demand.
  3. Customers are looking for retailers that carry Soft Gels, with over 26k customers over the last 6 months seeking stores where they can purchase these products.
  4. CannaCraft customers spend more money and shop more often than customers that don’t purchase our products.

In closing, we encourage retailers to carry ABX and Care By Design Soft Gel products in order to drive trips by valuable customers who spend more and visit often. Adding Soft Gels to a store’s menu efficiently converts shelf space into revenue, delivering value to retailers and increasing customer satisfaction. Partnering with CannaCraft proves to be a successful strategy that results in growing sales, customer loyalty and positive brand recognition.

*I Heart Jane Retail Sales Analysis 2021 December - May
** 2020 Headset CA Retail Sales Data - Basket Analysis