Portal - Company - EdiPure

Company Name: EdiPure

Categories: Edibles

www.edipure.com

Geographic Locations: California, Illinois, Colorado, Nevada, Washington

List of Brands: EdiPure

Subcategories: Sugar Candy, Baked Goods, Savory Snacks

Executive Summary

  • EdiPure ranks 6th in California edibles, 2nd in sugar candy, 6th in savory snacks and 23rd in baked goods
  • EdiPure offers colorful gummies in a wide variety of shapes and flavors, as well as hard candies, cookies, nut clusters and dried fruit
  • EdiPure is well distributed throughout the state, but particularly strong in mid-sized markets like Sacramento and San Diego
  • EdiPure’s consumers are more educated, affluent and medicate more often than the average medical patient
  • Taste, consistency, and word of mouth advertising drive EdiPure purchases

Methodology

Our company profiles leverage our multi-source methodology to give you the most complete view of each company from all sides. The insights provided on consumer demographics and feedback stems from Brightfield Group’s survey of more than 1,200 California medical patients in 2016. Detailed information on precise questions providing each graph and data point can be found in the report's endnotes. Market share and distribution data is based on our brand tracker, which analyzes digital menu audits from more than 1,200 dispensaries and delivery services throughout the state on a monthly basis. This is then evaluated with select POS data, survey data and interviews with dispensary owners which are used to weigh our algorithms.

Figure 1: EdiPure Performance in Major California Markets (August 2016): Edibles

Market

Percent of Dispensaries Carrying the Brand

Brand Share of Category

Brand Ranking in Category

Change in Ranking Since January 2016

California

26%

3%

6

-1

Sacramento

36%

3%

7

+1

Bay Area

16%

1%

14

-2

Los Angeles

28%

3%

4

-1

Orange County

19%

1%

12

+4

San Diego

53%

8%

1

No change

Geographic Distribution

Only five other edibles brands in California are more widespread than EdiPure. This places the company firmly within the top 8 edibles brands present in greater than 23% of California dispensaries.[1] There is a sharp drop off after this group with the next most widespread brand present in just 18% of dispensaries.

EdiPure is particularly well-represented in mid-size markets like Sacramento and San Diego where a significant number of patients reside, but the total number of dispensaries pales in comparison to the larger markets of Los Angeles and the Bay Area. EdiPure is 1 of just 4 brands present in more 50% of dispensaries in San Diego County.

In Los Angeles, 3 other edibles brands are more widespread than EdiPure and distribution is far lower than in San Diego or Sacramento. Likewise, 13 other edibles brands are more widespread in Los Angeles and the Bay Area (when combined). Market share is not solely related to distribution, but it is strongly correlated.

EdiPure’s competitors tend to be established in the market. Kushy Punch, which competes directly against EdiPure’s gummy candy, is one of the few brands more prevalent than EdiPure in Los Angeles, San Diego, and statewide.

Consumer Profiles

EdiPure relies on a customer base that is more educated and affluent than the average California medical marijuana consumer.[2] They are also disproportionately female, Asian or Asian-American, and/or married.[3] This is in sharp contrast to the customer base that supports Cheeba Chews, the leading sugar candy brand in California. Cheeba Chews’ customers tend to reflect the average California patient more closely (white, less educated, and less affluent) than EdiPure’s customers.[4]

The two brands are also distinguished by regularity of use with 82% of EdiPure customers consuming marijuana 5 or more days a week and just 57% of Cheeba Chews’ customers medicating as frequently. Across the California market, 62% of patients who consume edibles do so at least 5 days per week.

Figure 2: Average Income of California Medical Marijuana Customers by Brand

Purchasing Drivers

EdiPure customers choose the brand because they are seeking edibles that taste good, they trust the brand to provide consistent results, and their friends have recommended it.[5] These are common reasons for choosing edibles brands, but are different from the reasons people choose Cheeba Chews. Cheeba Chews’ customers are primarily attracted by the discretion with which they can consume their products.

EdiPure customers, in contrast, don’t tend to be concerned about discretion. [6] They are equally unlikely to care about cost or health concerns.[7] This sets EdiPure apart from most other leading California edibles brands, which often focus on attracting customers who want products that are free of unhealthy ingredients or packaged in ways that show evidence of rigorous lab testing. EdiPure ignores this demographic in favor of appealing to customers who want to medicate by consuming tastier (although less healthy) products on a near-daily basis.

Figure 2: Drivers of EdiPure Sales

Consumer Satisfaction

EdiPure’s customers are predominantly satisfied with over 70% of them saying they would purchase the brand’s products again. This is about 10% higher than the average edibles brand. In the edibles market, 30% of customers said they are “very likely” to purchase the average brand again, but just 18% of EdiPure customers said this. These numbers illustrate a situation in which EdiPure does not generate as much word of mouth from satisfied customers as other leading edibles brands, yet achieves equal or greater levels of repeat business. This is likely because the company’s customers (who tend to consume marijuana in “junk food” form) do not have the same standards for their marijuana products as customers in other subcategories catering to more premium products like gourmet chocolate, vegan baked goods, or superfoods-based savory snacks.

Figure 3: Overall Satisfaction Levels across Leading Medical Marijuana Brands

Consumer Preferences

EdiPure customers like the taste, price, and results of using the company’s products.[8] However, they are less impressed by the quality of ingredients used, the dosage, and package sizes. Specifically, about 33% of EdiPure customers said they wish the packages or dosages were larger and approximately 50% of them said they have no opinion on the quality of ingredients used. Quality of ingredients and dosage size are often important drivers of popularity for leading edibles brands,[9] but these concerns may not be as important to EdiPure as other brands because EdiPure’s customer profile is so unique.

Figure 4: Statewide Brand Share by Subcategory (August 2016)

Sugar Candy

Brand

Percent of Dispensaries Carrying the Brand

Brand Share of Category

Brand Ranking in Category

Change in Ranking Since January 2016

Cheeba Chews

56%

30%

1

No change

EdiPure

26%

11%

2

No change

Kushy Punch

34%

10%

3

No change

Sensi Chew

14%

4%

4

No change

Infused Creations

10%

3%

5

No change

Savory Snacks

Brand

Percent of Dispensaries Carrying the Brand

Brand Share of Category

Brand Ranking in Category

Change in Ranking Since January 2016

Stuck Up Extracts

17%

27%

1

No change

Auntie Dolores

5%

6%

2

No change

Uncle Ronnie’s

2%

2%

3

+6

MediPops

2%

2%

4

-1

EdiPure

2%

1%

5

-1

MaGooch Edibles

1%

1%

6

No change

Baked Goods

Brand

Percent of Dispensaries Carrying the Brand

Brand Share of Category

Brand Ranking in Category

Change in Ranking Since January 2016

Sweet Grass Kitchen

1%

0.2%

21

+16

Butter Brothers

1%

0.2%

22

-8

EdiPure

1%

0.2%

23

-6

Heavenly Sweet

1%

0.2%

24

+6

MediRoon

1%

0.2%

25

+18

Brand Portfolio and Competitors

EdiPure’s revenue is heavily reliant on the sugar candy subcategory, but also participates in the baked goods and savory snacks subcategories. The sugar candy and baked goods subcategories are important spaces in the edibles market, but EdiPure holds a small market share in the baked goods subcategory. The market for savory snacks, a third subcategory where the brand does reasonably well, is only approximately 10% the size of the sugar candy or baked goods markets. Some companies, including Stuck Up Extracts and Auntie Dolores, have proven it is possible to convert leadership in savory snacks into a prominent brand. However, it appears EdiPure’s focus will remain on sugar candy.

In the sugar candy category, EdiPure competes directly against Kushy Punch and Infused Creations (companies that offer primarily gummies and other candy products). Other leading sugar candy brands, including Sensi Chews and subcategory leader Cheeba Chews, focus on chocolate taffy products that tend to appeal to different types of consumers.

Infused Creations is primarily a Los Angeles brand that has shown stagnant market share in the LA region since January 2016 (while growing modestly in other markets). Kushy Punch is a more aggressive competitor that has seen its market share nearly double in Los Angeles, the Bay Area, and other parts of the state over the same time period. EdiPure matched Kushy Punch’s expansion in the Bay Area during the first half of 2016, but has been stagnant in Los Angeles. The companies’ differing performance in Los Angeles has caused the gap between the two brands’ market share to narrow significantly.[10] Kushy Punch now (modestly) exceeds EdiPure’s distribution, but Infused Creations continues to lag far behind.

Company positioning / Competitive advantages

The sugar candy market may be shifting in favor of gummy candy brands like EdiPure, Kushy Punch, and Infused Creations. These brands have collectively seen their share of the sugar candy market rise in 2016, while the market share of the leading taffy companies like Cheeba Chews and Sensi Chews have both declined. It is possible health conscious consumers are abandoning taffy brands as other trustworthy edibles products become more accessible in the marketplace. Customers of taffy brands are more likely than the average edibles customer to say they wish their edible cannabis products were healthier, while customers of the gummy brands continue to say they don’t care about buying healthy products. Migration of health conscious customers out of the sugar candy subcategory poses a threat for taffy brands, but could offer an opportunity for gummy brands such as EdiPure to capture some of the less-health conscious taffy customers.

Opportunities / Threats

EdiPure’s sugar candy distribution network offers another opportunity. The brand’s baked goods are in just over 2% of California dispensaries (which represents only 10% of the dispensaries that carry its sugar candies). There may be an opportunity to leverage this discrepancy by using the brand’s sugar candy distribution partners to expand the reach of its baked goods. This is a relatively unique opportunity but may be limited by the baked goods market’s preference for high-potency products made with healthy ingredients.

EdiPure’s baked goods products’ potency levels are less than those offered by leading baked goods brands like Korova and Venice Cookie Company. However, if every dispensary currently selling EdiPure’s sugar candies were to carry their baked goods, the company could become a top 5 player in the subcategory.

California voters will decide on the Adult Use of Marijuana Act in November, which would establish a recreational market in the state. Passage of the act would offer EdiPure an opportunity to use their expertise gained through operations in Colorado’s recreational market. The ability of sugar candy products to accommodate potential limits on recreational dosage (like Colorado’s strict 10mg limit for edibles) and its existing distribution networks would give EdiPure an advantage in a California recreational market. However, the brand’s reliance on sugar candy could be a hindrance if California regulators address the growing nationwide concern about the appeal of cannabis gummies to children. It is possible stringent packaging requirements could be imposed on gummy companies. This could limit their ability to take advantage of a recreational market, though the opportunity for EdiPure and other gummy companies to capitalize on a recreational market would be enticing (even under strict sugar candy-specific regulations).

[1] These are Cheeba Chews, Kiva, Korova, Bhang, Kushy Punch, Venice Cookie Company, EdiPure, and Liquid Gold.

[2] When asked to report the highest level of education they had attained, 40% of EdiPure customers said they had finished a bachelor’s degree and 20% said they had finished a graduate or professional degree. For the average brand, just 23% of customers reported having a bachelor’s degree and 6% a graduate or professional degree.

[3] 64% of EdiPure customers reported their gender as female, compared to just 48% of all CA medical patients surveyed.

46% of EdiPure customers reported their ethnicity as Asian or Asian-American, compared to just 8% of all CA medial patients surveyed.

55% of EdiPure customers reported being married, compared to just 31% of all CA medical patients surveyed.

[4] 51% of Cheeba Chews customers reported their ethnicity as white, compared to 48% of all CA medical patients surveyed and 36% of Edipure patients.

43% of Cheeba Chews customers reported household incomes of less than $49,999, compared to 49% of all CA medical patients surveyed and just 9% of EdiPure patients.

71% of Cheeba Chews customers reported the highest level of education they have completed is less than a bachelor’s degree, compared to 67% of all CA medical patients surveyed and 40% of EdiPure patients.

[5] When asked why they chose a product, 46% of EdiPure customers said, “I liked the taste.” For the average brand, the share was 35%. For the same question, another 36% of EdiPure customers said, “My friends purchase the same product.” For the average brand, 18% of customers said this. For the same question, another 27% of EdiPure customers said, “I trust the brand to give me a consistent experience.” For the average brand, 20% of customers said this.

[6] When asked why they chose a product, 15% of all edibles customers surveyed said “It was the most discreet form of consumption.” 43% of Cheeba Chews customers said this, but only a negligible share of EdiPure customers did.

[7] When asked they chose a product, 19% of customers said either, “It is organic, while others are not,” “It is lab certified, while others are not,” or “It is gluten-free, while others are not.” For EdiPure, a negligible share of customers gave these responses. For the same question, 11% of CA medical patients said, “It was the least expensive product of its type.” A negligible share of EdiPure customers gave this answer.

[8] When asked to rate their level of satisfaction with the taste of a product, nearly all EdiPure customers said they were satisfied. For the average brand, only 86% of customers expressed satisfaction.

When asked to rate their level of satisfaction with the price of a product, nearly all EdiPure customers said they were satisfied. For the average brand, only 78% of customers expressed satisfaction.

When asked to rate their level of satisfaction with a product’s ability to produce desired effects, nearly all EdiPure customers said they were satisfied. For the average brand, only 85% of customers expressed satisfaction.

[9] When asked to rate their level of satisfaction with the quality of ingredients used in a product, about half of EdiPure customers said they were satisfied. For the average brand, 80% of customers expressed satisfaction.

When asked to rate their level of satisfaction with a product’s package size, about half of EdiPure customers said they were satisfied. For the average brand, 78% of customers expressed satisfaction.

When asked to rate their level of satisfaction with a product’s dosage size, about half of EdiPure customers said they were satisfied. For the average brand, 82% of customers expressed satisfaction.

[10] EdiPure led Kushy Punch in statewide market share 12.7% to 4.7% in January and 11.1% to 9.6% in June. Over the same time period, Infused Creations saw its market share increase from 2.1% to 2.6%.

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