CBD Sales Spike Amid Pandemic Lockdowns as Consumers Seek Anxiety Relief

CBD Sales

To help curb the spread of COVID-19, government officials across the globe have issued several initiatives, including school and non-essential business closures, travel restrictions and in some cases, stay-at-home regulations. The new rules have resulted in a rise in self-care spending, as consumers search for ways to protect their health, boost their immune systems, stave off boredom and maintain their sanity. Among the self-care products being bought up at a rapid pace are CBD-infused products, offering companies like Mota Ventures (CSE:MOTA (OTC:PEMTF), Canopy Growth Corp. (NYSE:CGC) (TSX:WEED), OrganiGram Holdings Inc. (TSXV:OGI) (NASDAQ:OGI), Tilray Inc. (NASDAQ:TLRY), and cbdMD (NYSEAMERICAN:YCBD) a boost amid uncertain times.

Consumers Seek Out CBD Anxiety Relief Amid Pandemic

According to Brightfield Group, 76% of CBD consumers select “well-being” as their desired product effect, aligning with growing wellness trends. The research group believes that due to shelter-at-home recommendations and COVID-19 fears, anxiety levels are likely skyrocketing. Anxiety is the #1 ailment among CBD users, with 53% of them reporting to have it. Meanwhile, depression and insomnia, which are likely to spike over the coming months, are also high on the list. 

“With so much of the country in quarantine right now, many are turning to self-care indulgences to keep themselves sane and even just pass the time, which is likely to help boost some CBD self-care products during quarantine time,” said the Brightfield report.

The coronavirus is also expected to increase individual CBD purchases significantly, with 39% of users planning to use it more frequently during the pandemic

CBD e-commerce retailer Mota Ventures (CSE:MOTA (OTC:PEMTF) is already reaping the benefits of this new trend. The company saw its First Class CBD sales hit C$4.29 million in March 2020, an 235% increase from March 2019. Mota acquired First Class CBD, an established US e-commerce retailer, in January 2020 and has continued to expand its existing 150,000 customer base. First Class offers a broad selection of CBD products, from infused gummies and oils to pain cream.

In March, Mota Ventures announced the launch of its First Class CBD Pure Herbal Immunity Blend to meet customer demand for all-natural immune-boosting products. Thanks to the impeccable timing, the company acquired an additional 2,000 customers within a week of launching the new product. By the end of March, Mota Ventures’ (CSE:MOTA (OTC:PEMTF) had 20,959 total new customers and over 50,000 new customer inquiries

April has been much of the same for Mota, with the company’s eCommerce brands gaining over 6,000 new customers from April 1 to April 11. What’s more, 1,700 customers bought from the Immune Support product line during that same period.

CBD Companies See Boost in Revenue in 2020

Stay-at-home orders in the US and Canada have only been in place since mid-March, but it’s evident that CBD companies were already starting to reap the financial benefits of increased consumer interest prior to the pandemic. US online CBD sales shot up 230% prior to the coronavirus quarantines. What’s more, California orders hit a record peak on March 19, after Governor Gavin Newsom issued a shelter-in-place order for the state.

Direct-to-consumer online CBD company cbdMD (NYSEAMERICAN:YCBD) is one company that is seeing a significant increase in revenue during the COVID-19 pandemic. On April 6, the company announced that its preliminary year-over-year sales for Q2 of fiscal 2020 grew 167% to approximately $9.4 million compared to its Q2 fiscal 2019 quarterly sales of $5.64 million.

Then there were those already on the uptick prior to the outbreak, such as global cannabis company Tilray Inc. (NASDAQ:TLRY). In December, the company reported Q4 2019 revenue of $46.9 million (C$61.0 million), which represents a 202.2% increase compared to the fourth quarter of last year. The revenue growth is fuelled by Tilray’s diversified business model which includes global medical cannabis, adult-use recreational and hemp products.

In February 2019, Tilray entered the hemp market through the acquisition of Manitoba Harvest, the world’s largest hemp food manufacturer and a leader in the natural foods industry with products sold in over 16,000 stores at major retailers across the US and Canada. The company also launched a CBD-infused beverage line into the market just before the outbreak really hit.

Cannabis giant Canopy Growth Corp. (NYSE:CGC) (TSX:WEED) is also hoping to boost its sales by focusing on CBD initiatives, although it could be a while before the company is in the green.

It’s encouraging to see CBD stocks like Canopy Growth Corp. (NYSE:CGC) (TSX:WEED), OrganiGram Holdings Inc. (TSXV:OGI) (NASDAQ:OGI), Tilray Inc. (NASDAQ:TLRY), and cbdMD (NYSEAMERICAN:YCBD) generating revenue and growing their customer base after the brutal beating the entire cannabis industry took last year. But it could be Mota Ventures’ (CSE:MOTA (OTC:PEMTF) that stands the test of time. The company differs from others in the CBD space for a couple of reasons. First off, Mota’s zero-inventory business model helps protect it from shifting consumer needs. Second, as a pure-play eCommerce company, it is immune to the COVID-19 store closures that affect the bottom line of other companies with brick and mortar locations.

For more information on Mota Ventures (CSE:MOTA (OTC:PEMTF), please visit Microsmallcap.com.

Featured Image: Depositphotos © Daviles


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