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Friday, April 20, 2018 8:39:59 AM
“How cannabis has blown the doors off the enhanced water segment - NPD trends
By Tom Vierhile, Innovation Insights Director at GlobalData | 19 April 2018
As the legalisation of cannabis sweeps across the US, enhanced water producers are getting very excited
As the legalisation of cannabis sweeps across the US, enhanced water producers are getting very excited
Few ingredients in the natural and organic industry have generated as much buzz as CBD (cannabidiol). Naturally occurring in cannabis plants and renowned for its exhaustive list of health properties, this controversial chemical compound is starting to inspire a wave of innovation in enhanced waters.
CBD is one of nearly 90 different phytocannabinoids that naturally occur in cannabis, offering a glimpse of how prolific the chemistry is for the cannabis plant. CBD is typically harvested from hemp, which contains little or no THC (tetrahydrocannabinol), the psychoactive chemical naturally found in marijuana.
Hemp and marijuana both come from the same plant species, cannabis sativa. The major difference between the two is that the THC content for hemp is generally 0.3% or below, which is too little to make one 'high', while it may be as much as 30% for marijuana. As such, CBD is either entirely free of THC or only contains a negligible amount of the chemical. Because of this, CBD derived from hemp is widely available for sale throughout the US, although the legality of the hemp-derived CBD may vary from state to state.
CBD is believed to have a number of positive health properties but, because these properties have not been scientifically validated, product marketers cannot claim that CBD can cure specific ailments. Doing so could constitute an unproven health claim, so product marketers tend to make more general claims. Companies are likely to talk about the high antioxidant content of CBD or couch health claims in 'structure and function' language. Doing so insinuates that CBD may benefit cognitive function, modulate stress and anxiety levels, help fight inflammation, reduce the perception of pain and improve mood.
It may be a while before drinks companies can get specific about what CBD actually does, but some innovators are already walking the tightrope. California-based Endo Brands maintains that its CBD-fortified Endo water product is "neuro protectant", anti-inflammatory and eases anxiety and stress while helping to improve sleep. Endo water consists of pH-balanced water infused with hemp oil that is processed using nanotechnology - something common with a number of new CBD enhanced waters. This technology is said to produce CBD particles one-millionth of their normal size so they can be absorbed more easily by the body. Endo is one of the first flavoured CBD waters, debuting in four variants; berry acai, lemon-lime, cucumber and watermelon.
Also new and from the flavoured school is HighDrate CBD flavoured energy water, touted as a "healthier way to being more productive every day". Targeting a niche within a niche within a niche, this water is described as "premium oxygenated alkaline" water featuring "Alkame technology" and 10mg of CBD per bottle for good measure. Tropical coconut, Georgia peach, kiwi-strawberry and watermelon are the four available flavours for this US launch from Florida-based Kona Gold.
Not to be left out of the CBD water trend, the UK recently saw what was claimed to be the "first spring water in Europe that is infused with cannabidiol oil". Naturally-hydrating and claiming to "taste great" Love Hemp water is spring water infused with CBD hemp droplets. Offering "health and wellness for the mind and body", Love Hemp touts its CBD oil ingredient as being able to ease anxiety as well as improve cognitive function. New from London-based Love Hemp Water, the product is expected to cash in on the booming market for cannabis oil in the UK. According to Love Hemp Water, cannabis oil use in the UK doubled between 2016 and 2017.
Another CBD-enhanced water brands to keep an eye on is CBD Living Water, a nano-amplified powerful hydration beverage. The drink takes CBD and other nutrients (like d-ribose, coenzyme Q10, and methyl B12) and uses a process featuring nanotechnology to shrink the particles down to a size that increases bioavailability so they immediately penetrate into cells. The particles are encapsulated in what is called a "water cluster". The drink is marketed by US-based CBD Living Water and a single 16.9oz bottle retails for US$7.99, considerably more expensive than a "regular" bottle of water. CBD infusion apparently comes at a high price, as CBD enhanced water is at the very high-end of the premium price scale for bottled water.
Kind Water is CBD- and terpene-infused pure alkaline water from the California-based company of the same name. CBD is processed together with terpenes using "patented technology that significantly increases bioavailability" - a common theme with CBD functional waters. Terpenes are hydrocarbons produced by plants and are said to have "demonstrated consistent and measurable health benefits". Alpha pinene, limonene and linalool are the terpenes found in this new functional water, all occurring naturally in plants ranging from conifer trees to citrus fruits to mint.
CBD water has strong potential to attract consumer attention given the buzz around medical marijuana and various chemical derivatives from hemp and cannabis. Even so, it is unlikely that consumers are completely up-to-speed on CBD or its health benefits. That's why CBD-enhanced water marketers often ask consumers to "do their own research" on CBD.
The good news is that if CBD really does deliver on its purported health benefits, these benefits align well with the health-related issues that consumers say they're worried about. According to GlobalData's 2017 Q1 consumer survey, 75% of global consumers say they are concerned about stress, and 65% say they're concerned about insomnia - two key health issues targeted with CBD-infused enhanced waters.
The enhanced water segment is a fragmented market that is increasingly open to innovation. According to GlobalData market analysis, the five leading enhanced water brand-owners accounted for over an 80% share of the global enhanced water market as recently as 2011. By 2016, that grip had loosened to the point where these companies controlled just over 70% of the market.
An influx of innovative products from smaller beverage companies willing to bet on a controversial ingredient like CBD will likely continue this fragmentation trend.”
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