Pre-Rolls: An analysis of category trends & performance

August 22, 2022
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Introduction

Of the inhalable cannabis categories, Pre-Rolls are perhaps some of the most convenient product types. This may be why this category has continued to grow in both the US and Canada since our last report, and is currently the second largest product category next to Flower in Canada, and the third largest product category in the US. Throughout this report, we revisit this category and take a close look at the growth of Pre-Rolls, examining market share and segments in the US and Canada.

Executive summary

Through the first six months of 2022, consumers in the US and Canada have spent over $752M and $402M CAD, respectively, on Pre-Rolls. Canadian consumers are especially enthusiastic about this category, as Pre-Rolls made up nearly a quarter of all cannabis sales from January through June 2022, second only to Flower (42.6%). In the US, Pre-Rolls make up 12.6% of all cannabis sales, growing over 2% from the same period last year. When we take a closer look at Pre-Roll segments, we find that the Connoisseur/Infused segment has been growing in both countries. In the US, Connoisseur/Infused Pre-Rolls are the most popular among consumers and make up 41.5% of total sales. In Canada, this segment is not quite yet as popular, but has increased from 0.1% to 11.2% of total sales in the last year. The most popular Pre-Roll segment in Canada is Single Strain Hybrids, with 42% of total sales.

Methodology

Data for this report comes from real-time sales reporting by participating cannabis retailers via their point-of-sale systems, which are linked to Headset’s business intelligence software. Headset’s data is very reliable, as it comes digitally direct from our partner retailers. However, the potential does exist for misreporting in the instance of duplicates, incorrectly classified products, inaccurate entry of products into point-of-sale systems, or even simple human error at the point of purchase. Thus, there is a slight margin of error to consider.

The time frame for this analysis is from January 2022 through June 2022. Unless otherwise indicated, Canadian cannabis sales are from AB, BC, ON, and SK and United States cannabis sales are from CA, CO, MI, NV, OR and WA. All data is sourced directly from Headset Insights.

Market share of Pre-Rolls in the US & Canada

Cannabis Pre-Roll sales in the US and Canada image 1: Market share of Pre Rolls in the US and Canada

Pre-Rolls are very popular products in both the US as well as Canada. However, the Canadian preference for this convenient smokable is evident. In Canada, Pre-Rolls are the second largest product category with nearly one of every four dollars spent on cannabis going towards these products. This is nearly double the market share in the US, where Pre-Rolls are the third largest product category at 12.6%. Consumers in the US tend to spend more money on other product categories such as Vapor Pens, Edibles, and Concentrates, which can take market share away from some of the more traditional inhalable categories.

Market share of Pre-Rolls over time

Cannabis Pre-Roll sales in the US and Canada image 2: Market share of Pre-Rolls over time

When we look at how market share has been trending over the past year, we find that Pre-Roll market share has been increasing in both the US and Canada. Canada, again, shows their affinity for this product category with a 5.9% positive difference in overall market share for Pre-Rolls since June of 2021. The US has seen a smaller (+2.1%) but still notable increase in market share in the last year. This comes at the expense of a decreasing Flower category, which has decreased by 9.1% in Canada and 5.4%  in the US during the same period.

Cannabis Pre-Roll sales in the US and Canada image 3: Market share of Pre-Rolls over time in the US and Canada

In these graphs, we take a closer look at the growth of market share of Pre-Rolls in the US and Canada over the past year. Both countries have seen a sharper increase in market share during the first half of 2022. Since January 2022, market share of Pre-Rolls has grown 12.3% in the US and 31.1% in Canada.

Market share of Pre-Rolls in states & provinces

Cannabis Pre-Roll sales in the US and Canada image 4: Market share of Pre-Rolls in states and provinces

When drilling into the individual states and provinces, we see that the Canadian markets tend to have significantly more Pre-Roll market share than US markets, which is unsurprising given what we have seen in previous graphs. British Columbia is in the lead, with Pre-Rolls making up 28.2% of total cannabis sales in the first half of 2022.

Of the US markets, California has the most Pre-Roll market share with 14.8% of total cannabis sales. Colorado, on the other hand, has the lowest market share of Pre-Rolls at 8% of total sales, which makes it the fifth largest product category in the Colorado market. This can be attributed to the market shares of Concentrates (11.8%) and Edibles (14.7%) in Colorado, which are both higher than in other US markets.

Sales share of Pre-Roll segments

Cannabis Pre-Roll sales in the US and Canada image 5: Pre-Roll segments in the US and Canada

Here we focus on the various Pre-Roll segments and find a different mix when comparing the US to Canada. Single Strain Hybrid Pre-Rolls are king in Canada, commanding 42% of Pre-Roll sales. However in the US, Connoisseur/Infused Pre-Rolls dominate the category at 41.5%, recently overtaking the Single Strain Hybrid segment. This Connoisseur/Infused segment is growing in both countries, although it is much smaller in Canada, making up only 0.1% of Pre-Roll sales at this time last year. In past reports, we have speculated that the Connoisseur/Infused segment market share difference could potentially be related to price.

Across the Pre-Roll category, Canada’s average unit price is about 17% higher than in the US. In Canada, the average unit price for a Pre-Roll product is $21.13 CAD (or $16.46 USD) compared to $13.90 USD (or $17.82 CAD) in the US. The Connoisseur/Infused segment has even higher prices in Canada. In Canada, the average price of Connoisseur/Infused products are 21.7% higher than in the US at $26.75 CAD (or $20.86 USD) in Canada and $16.78 USD (or $21.51 CAD) in the US.

Conclusion

From this data, it is clear that the Pre-Roll category is growing in both the US and Canada. It seems that the Flower category continues to surrender some of its grip on cannabis sales to other product categories, and Pre-Rolls are benefitting as well as they are now the second largest category in Canada and the third largest in the US through the first part of 2022. Showing particularly strong growth in share of total sales in the first two quarters of the year, it will be interesting to see if  Pre-Rolls maintain this trajectory through the rest of 2022 and into the future. To read more about Pre-Rolls, take a look at our report about Pre-Roll Multi-Packs in the US and Canada. If you’d like to monitor Pre-Roll category trends, or keep track of other product categories, sign up for a demo to learn how you can identify opportunities within the cannabis industry.

Key takeaways

  • Canadian consumers dedicate nearly twice as much market share to Pre-Rolls than US consumers, with the category being the second largest for Canada (24.1%) compared to the third largest for the US (12.6%).
  • Pre-Roll market share has grown over the past year, gaining 5.9% of total cannabis sales in Canada and 2.1% in the US since this time last year.
  • Connoisseur/Infused Pre-Rolls are experiencing high growth in both US and Canada. This segment has the highest share of total sales in the US (41.5%) and grew from 0.1%  to 11.2% in the last year in Canada.
  • Canada experiences a 17% higher average unit price for Pre-Rolls compared with the US.

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