FOOD & BEVERAGE

Drinks on them

Two years ago, the internet declared 2019 “White Claw summer,” with consumers so obsessed that they caused a shortage. But now, spiked-seltzer sales are coming down from their highs, and there’s shelf space for a new buzz-inducing drink. Enter: cannabis beverages.  

According to Brightfield Group research agency, THC-infused beverages will account for $1 billion in US sales by 2025. Sales of CBD drinks, which are available on a wider scale and in places where cannabis is not yet regulated, are expected to hit $2.5 billion. Meanwhile, legal cannabis sales are set to increase from $30 billion in 2020 to $90 billion in 2025, per Euromonitor data.

• Quick science lesson: THC and CBD are both derived from the cannabis plant, but THC is known for its psychoactive high, while CBD is considered a “non-psychoactive” compound, meaning it provides more of a light buzz. 

Already, alcohol companies like Pabst, Lagunitas, and Constellation Brands are eyeing those numbers and hopping on the weed wave with their own cannabis beverages. But they’re counting on small cannabis CPG purveyors to pave the way.

“Similar to the spiked-seltzer space, you’re going to see an explosion of small boutique brands,” Kearney’s Bryson Waterman told Retail Brew. “You’re going to see the big players in the marketplace sit back and allow these small growing brands to navigate the hurdles of regulation and overcome the complexities.”

Drink it in

Dixie Elixirs, one of the first cannabev manufacturers, debuted in Colorado in 2010. Its line of THC drinks has since expanded to include gummies and chocolates.

• The flagship elixirs are served at 100 mg of THC per bottle with a “dosing” bottle cap that allows drinkers to measure out their servings (a typical dose is 10 mg).

“That’s something that’s a bit unique to liquid products, that it’s very easy to titrate your dose,” David Grigsby, brand director for Dixie’s parent company BellRock Brands, told Retail Brew. It’s ideal for the “canna-curious consumer.”

That broad appeal is also why—even as cannabis moves toward a “CPG-minded” industry (BellRock’s roster of companies, for example, sell CBD and THC edibles, ingestibles, and topicals in 2,000+ dispensaries nationwide)—cannabevs are an obvious early winner, Grigsby explained. They “hit a very unique audience, separate from other things that you might find in a dispensary.”

• US cannabis-infused beverage sales surged 40% last year, to $95.2 million, according  to the Cannabis Beverage Association. 
• Beverages make up roughly 3% of all purchases at dispensaries in California, Colorado, Massachusetts, Michigan, Nevada, Oregon, and Washington, per Forbes; 6.5% of consumers in those states purchased a THC-infused drink last year, up 10% from 2019.

“Most people know what it feels like if they have one glass of wine,” Grigsby said. “Cannabis is still new to a lot of people. So we find that the beverage format really bridges that gap and makes for ease of use and confidence.”

Click here to read more about how cannabevs are taking a page from hard seltzer and what’s next for the bubbling market.—JG

DELIVERY

Click and ship

Patience is a virtue, but maybe not when you need a pack of Band-Aids stat. With that in mind, Shipt is undergoing its biggest expansion in three years, which includes same-day delivery to nearly 1,000 of its store partners. 

Why it matters: Shipt plans to reach 2 million additional customers who were previously outside of its coverage area. 

• The company said it’s worked with retail partners like CVS, Bed Bath & Beyond, and Party City to identify locations for growth. 
• As a result of the expansion, Shipt will be available in 200 more CVS locations and 50 more GNC stores—a relatively new partnership for the company.  
• Customers in Atlanta, Charlotte, Los Angeles, and Seattle will see the largest number of new locations available. 

Retailers using Shipt’s delivery-only service—Shipt Driven—will see increased business from multiple verticals, the company said, including grocery, wellness, and home goods. 

“Over the years, Shipt has launched one city at a time or rolled out a new retail partner nationwide, but this exciting coast-to-coast expansion is unlike anything we’ve done before,” Shipt COO Bridget Fruit said in a statement. 

The big picture: Same-day delivery is the next frontier, as customers want their stuff faster and faster. Today, UPS said it would acquire Roadie, a gig-delivery platform, to boost its same-day capabilities, while Amazon expanded its offering to six more cities last month.—KM

SPONSORED BY LISTRAK

Say ‘Ta-Ta’ to Your Old Marketing Stack

You’re thinking it, we’re thinking it, and now we’re gonna come right out and say it: That old marketing stack is embarrassing. Alright, that’s a little harsh, but it is due for an upgrade. 

Now, as with any big decision, one can’t afford to take a step in the wrong direction. 

Lean on Listrak for a little help—they’re a leading digital marketing platform trusted by 1,000+ retailers and brands, and they know all the dos and don’ts when it comes to making an upgrade.

Their latest guide is stacked high with insights from across their client base and literally thousands of evaluations. 

See how brands like Vineyard Vines, Kate Somerville, 7 for All Mankind, and Academy Sports go about picking the right tech partner.

Download Listrak’s guide today.

APPAREL

Leggings for days

The cult of Peloton just got stronger, and so did our Zoom wardrobe. Yesterday, the fitness company announced its new private-label clothing brand, Peloton Apparel. 

The warmup: Peloton’s approach to apparel for years was collabs with brands like Adidas and Athleta.

• “When we started, we would buy blanks and just slap logos on them,” Jill Foley, Peloton’s VP of apparel, told WWD. “Then we got more sophisticated and would work with other brands to design for us. But it was still their label.”

The success of those collections showed Peloton there was an opportunity to bring things in-house.

“Apparel was never going to be a huge part of the story until our members asked for it so we’re working to get it on as many people as possible,” Foley added.

• Peloton members and instructors wear-tested the collection for three years leading up to the release. 
• The company will market the collection online and outdoors using instructors and members.

The stretch: Eighteen months into the pandemic, people still aren’t sick of leggings. Lululemon said it expects to surpass its 2023 revenue target by the end of this year. Meanwhile, Peloton saw losses widen and slashed the price of its Bike last month.—JG

WHAT ELSE IS BREWING…

• President Biden announced new vaccination requirements for companies with more than 100 employees. 
• Doordash, Grubhub, and Uber Eats are suing New York City over legislation that places a cap on restaurant fees.
• California’s legislature passed a bill that aims to protect garment workers. 
• Facebook introduced a line of smart glasses with Ray-Ban.
• Amazon will cover college tuition costs for its hourly workers. 

SPONSORED BY PRIVY

Shopify store improvements, on the house. Privy’s Shopify Store Grader analyzes your Shopify storefront for free in just 15 seconds. Then, Privy identifies ways to help you improve website conversion and boost sales. The holidays aren’t too far off, so now’s a good time for a website refresh for any brand. Learn more about Privy’s Shopify Store Grader here. 

SWAPPING SKUS

Today’s top retail reads. 

Spent: 9/11 spurred a new kind of consumerism where shopping became a patriotic duty. (Vox)

Mission critical: Inside the Black Yard Farm Cooperative and its pursuit to fight food injustice within POC communities. (Vice)

Change of plans: Dreams of a glamorous fall wardrobe must now contend with the reality of the Delta variant. (Fashionista)

ICYMI

Catch up on the Retail Brew stories you may have missed.

• Bot me, bro: Autonomous delivery startups are hitting college campuses
• The pumpkin spice halo effect is in full swing for Starbucks and Dunkin’
• A look inside Jokr, the rapid grocery delivery company

FRIEND OR FAUX?

Three of the stories below are real...and one is most definitely not. Can you spot the fake? 

1. A Taco Bell x Uniqlo apparel collection drops in three weeks.  
2. The NFL and Ed Sheeran teamed up for a line of merch. 
3. The iPhone 14 design leaked a week ahead of the iPhone 13 reveal. 
4. Twix created a seasoning blend for chicken wings. 

Keep reading for the answer.

FRIEND OR FAUX? ANSWER

There isn’t a Taco Bell x Uniqlo clothing line...yet.