Gen Z: Are they the Future of Cannabis?

Baby Boomers might have broken the initial taboo over cannabis usage in the ‘60s, GenX may have inherited it from their parents, and millennials are for now the biggest overall consumers. But at least as far as digital cannabis analytics firm Headset is concerned, it’s Gen Z who are poised to take over the market and, presumably, shape its future according to its own tastes, politics and demands. Last year, a breakdown of sales across four adult-use states found that for the first time since Headset began measuring, Gen Z overtook Baby Boomers in overall sales — 12.7% to 12.2%. Strictly defined, Gen Z comprises all people in the nine-to-24 age bracket, which means that the vast majority of Gen Z still can’t legally purchase cannabis. So to put it mildly, those who can are clearly punching well above their weight when it comes to their purchasing power.

In addition, Cassandra, the insights and strategy wing of the media and marketing firm ENGINE, released the results of a survey conducted with the female-focused cannabis brand Miss Grass just before the 2022 420 holiday. About 50% polled said they were planning to celebrate the holiday, by the way, and 25% of them over 18 said they would plan to buy stock in the industry. So, they’re set to make it their own in more ways than one.

SO WHAT DO THEY WANT?

First off, Gen Z customers prefer prerolls to raw flower. Only 50% opt for flower compared to 61% of other generations polled. They also buy far more concentrates, pushing ahead at 31% eight percentage points from other generations. As far as cannabinoid preferences go, they prefer THC well over CBD, with 3.4% of their purchases containing CBD (non-inhalable products, such as topicals or edibles, were a far smaller proportion of total Gen Z sales — 9.6% as opposed to 14.6%.).

Branding, however, is a trickier subject. Headset’s analysis maintains that Gen Z is still in the experimental phase when it comes to trying out cannabis brands. According to them, only 20.6% are buying at least 75% of their vape pens from the same brand, versus 25.2% from other generations. However, the Cassandra/Miss Grass survey found its respondents to be highly receptive to impressive branding, if not specific brands themselves. One participant stated his preference towards “nice, cool, trendy, funny, accessible and portable packaging.” Moreover, in keeping with the received wisdom around this cohort, the Gen Z respondents also expressed preference around products that reflected their values, particularly around social equity.

Because Gen Z came of age during a time of increased cannabis liberalization, it’s not surprising to discover that they tend to see cannabis just like they do any other product, minus the stigma that other generations before them inherited. In particular, according to Cassandra, they look at cannabis as part of their self-care routine — 50% of those polled felt those into their mental health and wellness would gravitate towards cannabis.

A separate survey conducted by Technomic put even more stark numbers to Gen Z, which found that 65% of those Gen Z respondents polled smoked cannabis. Because Technomic found Gen Z to be homebodies at heart, it should not surprise anyone that 69% of Gen Z cannabis users liked to play video games while consuming. Interestingly, their ardor has cooled significantly towards alcohol. While 38% said they’d visit a cannabis lounge where it was legal, only about 41% said they’d visit a bar, versus 65% of millennials, who for now are the largest consumers of cannabis — 51.8% in 2021, according to Headset. (It should be noted that in the same Technomic survey, 51% of Gen Z respondents did report drinking cannabis-infused beverages.)

THE CANNABIS NATIVE

Just like previous generations that have grown up with cell phones, Gen Z has grown up around the normalization of cannabis. They’re likelier to see it like any other product, and while they haven’t embraced brands all that much, it’s on their minds: 40% of them said to Cassandra/Miss Grass that they have discussed a branded product. As Headset senior analyst Cooper Ashley told Cheddar, "Basically every single day, there are more and more and more Gen Z customers turning 21 and therefore being of legal age to purchase cannabis. And as far as we can tell, they're going to become one of the most important, if not the most important, demographic groups in the cannabis industry."