Nielsen predicts Amazon entry into U.S. CBD retail at MJBizCon hemp forum

Learn more about the state of  retailing in the marijuana industry at MJBizCon 2020.

E-commerce behemoth Amazon is likely to get involved in hemp CBD U.S. retail, according to a forecast revealed during the Hemp Industry Daily Forum as part of the cannabis industry’s flagship conference, MJBizCon.

Sales of hemp CBD products are expected to grow to nearly $7 billion by 2025, and a federal ruling on CBD regulation will bring bigger players like Amazon and other established brands into the CBD fray, Rick Maturo of Nielsen Global Connect told event attendees.

The market research firm expects Amazon’s entry to “ultimately cause greater price compression, and even some attrition, among some of those exclusive online brands and brands that are selling primarily online,” Maturo said.

“With respect to Amazon, we’d expect that they will turn to a few major reputable manufacturers where they can be assured that … the product that consumers are ultimately getting is tested and a legal hemp CBD product.”

“Depending on the success of this development, we could also see Amazon release their own Amazon private label brand, or potentially purchase the sole rights to one of the brands they partnered with previously.

Earlier this year, Amazon revealed it had launched an invitation-only pilot program allowing the sale of select CBD ingestibles on its UK website, saying only sellers participating in the scheme were exempt from its sales ban on edible products containing CBD or other cannabinoids.

The company declined to respond to Hemp Industry Daily‘s request for details on how many companies were invited to take part in the UK programme, the criteria used to select them and how the pilot program will be evaluated.

Maturo said that, based on Nielsen projections, 2021 and 2022 will be big years for hemp CBD sales growth.

Nielsen data indicates that year-on-year sales growth will exceed 80% in 2021 and be at least 65% in 2022.

“Much of that growth is going to be contingent on forces that are out of our immediate control, and much of it is going to be placated on … what the FDA does for hemp CBD in 2021, and how traditional brick and mortar retailers respond,” Maturo said.

Download more of Nielsen’s projections for hemp retail in the free report “How to Navigate the Complicated World of CBD in Retail.”