Canada’s illicit cannabis dominated Ontario’s cannabis market for decades. After the legalization of recreational marijuana in 2018, illegal cannabis still controlled 80% of the market share. However, the budding legal cannabis industry is upsetting the status quo in Ontario’s cannabis market.
In October 2020, the national legal marijuana sales were worth $270 million, with Ontario posting $84 million in sales. Ontario’s legal cannabis industry market share currently stands at 36%; statistics project a higher market share post-pandemic.
Ontario City’s commitment to safe and responsible access to cannabis products is the pillar behind the thriving market. Read on and discover how Ontario has contributed to the growth of cannabis.
1. Franchising over Monopoly
While the Canadian government legalized marijuana at a federal level, provincial authorities can pass legislation regulating the marijuana industry at their discretion. The provincial-run Ontario Cannabis Store (OCS) was the only legal wholesale and retail cannabis distributor. The initial plan was to have more OCS stores around Ontario.
However, Ontario’s Provincial government later adopted the franchising model and issued licenses to private players who qualified to join the legal cannabis Ontario market. The first privately owned brick-and-mortar cannabis shops began operation in April 2019.
Ontario’s provincial government shifted the potential expansion and staff training costs to cannabis enthusiasts seeking to enter the legal market. The private sector had the resources to meet customer needs regarding product preference and other service-related factors better.
2. Access to Products
One need Ontario’s legal cannabis industry met was easy access to cannabis products. The initial licensing process for private shop owners in Ontario was through a lottery system. Only 25 brick-and-mortar cannabis shops had licenses in Ontario. The number currently stands at 280 and counting.
The rising number of cannabis shops attracted cannabis enthusiasts that previously relied on illegal dealers for products. Cannabis shops in Ontario also created an experiential shopping experience using budtenders and an array of high-quality products.
Ontario cannabis shops are among the few flourishing businesses during the Covid-19 pandemic. This is because local legislation allowed them to carry out address deliveries and pick-ups for the first time. Most Ontario cannabis businesses hope they could continue to execute deliveries after the pandemic.
3. Product Quality Legislation
The provincial government has rules governing the production, packaging, and distribution of cannabis products. It has even teamed up with select colleges to tailor a certificate program graduates must take before joining the cannabis quality control team.
The cannabis regulations for licensed producers help promote safety among cannabis consumers. Quality control regulations also allow cannabis businesses to tap into fresh cannabis product markets.
4. Wide Variety of Products
There are over thousands of licensed cannabis products in Ontario’s weed shops. You can shop for anything, from an array of cannabis flowers to unique hemp products like CBD ice cream.
The law prohibits cannabis shops from overt advertising; hence, they have to find creative ways to promote their shops. Some of the promotional methods they used included focusing on a marketing niche and diversifying their product portfolios.
Ontario cannabis shops stock an exceptional array of cannabis products to position themselves in the market. The stiff competition works for the consumers as they get to experience new products.
5. Price Regulation
Recent statistics show that the average price of cannabis flower in Ontario’s legal weed market is lower than the price average in the illicit market. The low prices contribute to the growing demand for various cannabis products as more cannabis enthusiasts become attracted to the legal market.
It makes no sense to pay more to break the law while you could get quality products and unique after-sale services for less.
6. Cannabis Lifestyle
Ontario’s event management industry is cashing in on the thriving legal cannabis market. The variety of products, easy access to high-quality cannabis products, and affordable prices simultaneously contribute to flourishing cannabis culture.
In line with this, multiple cannabis-centric events happen monthly or annually to celebrate the gains made by Ontario’s cannabis industry. Cannabis enthusiasts attend such events to socialize, meet like-minded individuals, and discover trends and opportunities in the cannabis market.
The events also present opportunities for cannabis shops to conduct market research, discover emerging consumer trends, and market their businesses. From their findings, they can tailor and stock cannabis products that meet the needs of various demographics. For instance, there is a current surge in interest in CBD and other THC-free products.
7. Consumer Education and Empowerment
Consumer education is at the heart of Ontario’s cannabis industry marketing strategy. Some of Canada’s top online and print cannabis publications have their headquarters in Ontario.
Cannabis publications have played a significant role in helping the industry overcome “stoner stereotypes” and focus attention on the benefits of various cannabis products. They also serve an advocacy role by mobilizing cannabis enthusiasts in amplifying the voices of cannabis activists on regulatory and legislative issues.
However, the prominent role of Ontario’s weed publications in selling cannabis products is providing an advertising platform for cannabis businesses.
Ontario’s cannabis industry is vibrant and thriving because of the province’s role in promoting safe and responsible use of cannabis products. The strategy seems to work, as illustrated by the rise in the province’s legal weed industry market share.