The ‘Vape Crisis’ caused a significant decrease in Vapor Pen market share in all Adult Use cannabis markets covered by Headset starting in mid August 2019. By late September 2019, Vapor Pen market share stabilized in all states. In California, it has since begun to slowly increase
In Washington the emergency ban on flavored vaping products significantly affected vapor pen market share
How did the crisis affect total sales?
This graph shows that the Vape Crisis did not affect Total Adult Use cannabis sales. We can see that Week by week growth within and after the heart of the ‘Vape Crisis’ media coverage in 2019 closely matches the week over week growth in 2018
I chose this metric because it best accounts for seasonality within the markets - note that week number 35 contains Labor Day weekend explaining the surge in growth and then decline in week 36 both years
What other categories have consumers turned to
Both Edibles and Pre-Roll market share increased during and after the heart of the ‘Vape Crisis’ (note this is aggregated market share across CA, CO, NV and WA)
What effect does government action have on sales?
We can use Washington as a potential example of what sales in other states may look like if strict regulations go into place. Here we can see that on the day the governor announced an executive order unit sales and discount increased, however this was a Friday, so that’s not terribly unusual. The following weekend saw even higher unit sales, and higher discounts than usual. Discounts stayed high as the health board vote approached, then on the day of the vote passed, unit sales and discounts skyrocketed as retailers scrambled to get the banned products out the door before the end of the day. Then everything collapsed, but not that far below average
Avg discount typically 11-13% on a normal day. Avg discount was 31.6% on 10/9/19
From the week of 10/7/19 to the week of 10/14/19 the number of unique vapor pen products sold in Washington decreased by 32% and the number of distinct brands selling vapor pen products decreased by 9%. This indicates that approximately 1/3 of products were flavored and therefore suddenly not legal to sell
Consumer trusted brands can still thrive
In WA the brand Heylo has nearly tripled it’s market share within the vapor pen category since the flavored vape ban. They do not produce any flavored products and are a brand that is (according to their website) ‘ defined by education and transparency
Predictions - consumers will continue to return to the regulated adult use vaping market as more information becomes clear, especially because illicit THC cartridges are linked to most of the VLD cases.