What Makes a Cannabis Industry Leader? -- CFN Media

Seattle, Washington--(Newsfile Corp. - May 7, 2019) - CFN Media Group ("CFN Media"), the leading agency and financial media network dedicated to the North American cannabis industry, announces the publication of an article discussing Ionic Brands (CSE: IONC) and its multi-state consumer branding and product strategy.

Ionic Brands
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There are hundreds of different cannabis investment opportunities across North America, ranging from cultivators to dispensaries to ancillary service providers. With the growing competition, it's important for investors to understand the factors that influence whether early-stage cannabis companies will succeed. Production capacity may have been the most important factor in the past, but branding and product formats are becoming more important.

In this article, we will take a look at these two factors driving the value of multistate operators and how Ionic Brands is addressing both of them.

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Building Premium National Brands

The $146.4 billion global cannabis industry is in the midst of a massive shakeup, as traditional flower surrenders market share to concentrates and edibles. The fastest growing concentrates category is marijuana vape products, which are experiencing the same growth trajectory as e-cigarettes in the tobacco industry. Consumers are demanding more discreet and sophisticated ways to consume cannabis products.

New brands are launched every day-especially in the vape category-but the industry remains fragmented. Multi-state operators are trying to close the gap by introducing consistent, national brands that span several states. In addition to helping consumers select products, the companies behind these brands are capturing early market share on a national level, protecting long-term profit margins, and creating sustainable competitive advantages.

Many MSOs have focused on building strong brands in the Western United States where recreational cannabis has already been widely legalized across several states. For example, Washington State, Oregon, and California have all legalized recreational cannabis, while Nevada, Colorado, and Arizona are natural markets for expansion in the future.

Focusing on Concentrates, Not Flower

The cannabis industry may have begun with cannabis flower, but there's no doubt that concentrates will become the industry mainstay. Concentrates have already become the fastest growing segment of the legal cannabis industry and continue to capture shelf space and market share from cannabis flower products across many states. In fact, concentrates have captured 26.6 percent of the market, gaining dollar sales faster than any other product. ArcView and BDS Analytics estimate that concentrates will reach $8 billion in sales by 2022.

Within the concentrates category, vape oil continues to lead the market in growth versus live resin, oils, wax, shatter, and other concentrate products. The market for vape products surpassed $5.5 billion last year, according to Wells Fargo analysts, representing a robust 15% compound annual growth rate across tobacco and cannabis. In 2017, ArcView and BDS Analytics found that vape cartridges accounted for over half of concentrate sales, and those figures could rise to 80 percent of sales by 2022-or a $6.5 billion market opportunity.

Altria Group's $12.8 billion investment in JUUL, resulting in a lofty $38 billion valuation, underscores the growth opportunity. In the cannabis industry, many companies are attempting to position themselves as leading providers of vape oils. Premium vape pens and differentiated vape oils that capture early market share could enjoy lasting advantages.

Innovative cannabis companies are also looking beyond vape pens and oils to other forms of high-growth concentrates. For example, edibles are quickly becoming a mainstay of the industry. Cannabis-infused chocolates, beverages, and other product categories could replace candies and beers as recreational options for consumers.

Ionic Brands recently entered into the highly desirable edibles market. It is estimated that edibles spending in US and Canada topped $1 Billion in 2017 with a forecast to grow to more than $4.1 Billion by 2022. The Zoots acquisition provides the company with unique exposure to the edibles space and plays into the Company's cannabis concentrates expertise as one of the largest volume extractors in Washington State.

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Ionic Brands Provides Exposure

Ionic Brands (CSE: IONC) (FSE: IB3) has built the leading cannabis vape brand in Washington State with products available in nearly 141 stores. The company has expanded its business into California and Oregon and has plans to move into Nevada in mid-May through a direct model. Ionic plans to expand into more recreational-use approved states like Arizona, Colorado, New York, and Massachusetts in the coming months as well.

The company recently announced an exclusive distribution agreement with Continuum, a California division of Origin House, to distribute its branded products. With reach into more than 500 dispensaries across California, the agreement could bring Ionic's leading vape pens and other products into the single largest state cannabis market.

Unlike many of its competitors, Ionic has also invested in building its own supply chain to control quality and costs. The company cultivates cannabis outdoors and is targeting costs of less than ten cents per gram, extracts it with ultra clean CO2 extraction, loads it into patent-protected vape hardware, and distributes it across a growing number of states.

The company generated almost $10 million in revenue last year - more than double its 2017 revenue - and continues to see strong growth. With seven years of hands on experience in building the company, the management team is well positioned to become a leading MSO over the coming quarters as it expands across state lines.

Investors may want to take a closer look at the company as it looks to address the two most important trends in cannabis: product format and branding. The company's focus on vape products is designed to capitalize on the rapid growth in vape consumption methods, while its ability to put brands in stores across state borders could open the door to more rapid growth than single-state operators without the capital, licenses, or expertise to execute.

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Please follow the link to read the full article: https://www.cannabisfn.com/what-makes-a-cannabis-industry-leader/

About CFN Media

For Visitors and Viewers

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The above article is sponsored content. Emerging Growth LLC, which owns CannabisFN.com and CFN Media, has been hired to create awareness. Please follow the link below to view our full disclosure outlining our compensation: http://www.cannabisfn.com/legal-disclaimer/

Frank Lane
206-369-7050
flane@cannabisfn.com

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