October 31, 2018
A couple of months ago, a rumor started doing rounds that the soda giant Coca-Cola might enter the cannabis industry by introducing CBD-infused beverage. It was reported that the soda company was in talks with a Canadian marijuana venture Aurora Cannabis. Amid the unconfirmed nature of the news, the stocks of Aurora Cannabis jumped 23 percent in a single day.
At the time the rumor went public neither of the parties confirmed or denied it. After months of speculations in the industry, the CEO of Coca-Cola has finally spoken and put the rumor to rest. He has made it clear they no such collaboration is on cards and the company doesn’t have any plan to enter the cannabis market at this stage. The stock trading of both companies suggests that the denial from the Coke hasn’t affected their standing on the index.
The news or better to say it rumor now had some credence to it to be taken seriously. It has been estimated that the CBD-based products will cross the market capitalization of $2 billion in the next two years. Most importantly, edibles, beverages, and cosmetic products will make a substantial part of this market. So, it is only natural to think that a leading beverage company is going to enter a market with multi-billion potential.
Apart from that, there are also many other reasons why it is pretty logical to assume that Coke is going to test the waters with cannabis. For instance, the US soda market is facing a downward pressure in the last couple of years. Many reports and surveys have indicated that fewer people are now drinking soda beverages. This means soda companies have to look for new avenues to sustain their market position.
In addition, by introducing sports drinks, juices, the soda companies are also reworking their brand image. Coca-Cola has also introduced a range of such products. Meanwhile, CBD-infused drinks are also getting traction among consumers for its health benefits.
CBD is an active cannabinoid present in cannabis, which is being researched for many of its therapeutic benefits. The CBD-only products are also becoming popular because this cannabinoid doesn’t have any psychoactive and psychedelic effect on the user. In short, you won’t get high if you consume CBD-infused food or drink.
What future holds?
Many experts think that the entry of Coca-Cola into the cannabis market is just a matter of time. Like other big mainstream corporate entities, Coca-Cola also doesn’t want to rush into a nascent industry. Secondly, companies like Coca-Cola don’t have any apprehension about lost opportunities. The soda company knows that it will make a mark whenever it enters the cannabis industry.
Lastly, competition is also one factor that will derive future decisions. Let’s suppose, Pepsi Co announces to go on a test trial with a cannabis-infused beverage product in Canada. It is very unlikely that the development of such proportion won’t spark a sense of urgency among the decision-makers at Coca-Cola.
Marijuana stays in the news, and Alice is always ready to keep us updated. A world traveler and lover of freedom, Alice knows what is going on, no matter where she roams. She specializes in marijuana legalization stories across the globe, with up to date... [read more]