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Ask Our Experts: Will Cannabis Legalization Impact Alcohol Sales?

February 25, 2019 10:31 am
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Ask Our Experts: Will Cannabis Legalization Impact Alcohol Sales?

Q: I am curious, how cannabis legalization might impact alcohol sales. Do cannabis users also drink alcohol?

A: The usage patterns of alcohol and cannabis are nuanced and changing. While it is common for cannabis consumers to also use alcohol, many indicators suggest that cannabis legalization will have material effects on the alcohol industry in the future.

New Frontier Data estimates that in the United States, some 63% of cannabis users consume alcohol at least a few times per month, more than among the overall U.S. population (56% of whom report drinking in the past month). Importantly, there appears to be a correlation between usage frequencies of cannabis and alcohol. On average, 30% of all cannabis users consume both products weekly; notably, daily cannabis users are more likely to consume alcohol daily than any other cannabis usage group — an important distinction for stakeholders in the alcohol industry to realize.

Consideration of consumer attitudes and preferences make the story more complex. We found that 65% of cannabis users agree that they would prefer to consume cannabis over alcohol (49% strongly), while 45% agree that they have replaced some drinking with cannabis use. For younger consumers who have not fully established an affinity for alcohol, increased access to legal cannabis and the product innovations that enable more convenient and discreet cannabis use will translate into increased displacement of alcohol by cannabis in the future.

It should be noted that the questions do not sum to 100%, as respondents had the option to answer, “Don’t Know”. It can be inferred that any remainder falls into the “Don’t Know” category.