Charlotte’s Web Holdings, Inc. (TSX:CWEB)(OTCQX:CWBHF) announced this week it would be offering consumers a new type of product line: CBD gummies. The Colorado-based CBD company said its customers have been requesting the popular gummy products and as of Monday three different options–focused on sleep, calm and recovery–are available for online ordering.
The gummies will cost US$54.99 per bottle of 60, and offer users with unique options with a range of effects:
- The Calm option contains lemon balm and an amino acid to alleviate stress.
- The Recovery option has added ginger and turmeric to aid in sports recovery.
- The Sleep option contains melatonin, and is meant to take before bedtime.
“When developing this product line, our product sciences team wanted to ensure that our gummies would be differentiated and thoughtfully formulated to be as effective as possible. As a result, we’ve created superior formulations that pair our high-quality hemp extract with supporting botanicals to provide enhanced results.”
– Deanie Elsner, Charlotte’s Web CEO
The hemp-based gummies are just the latest CBD offering from Charlotte’s Web, which recently announced it would be launching a line of pet products as it hopes to build on its strong revenues it has posted so far.
CBD strategy proves effective and profitable–so far
Charlotte’s Web’s focus on the CBD wellness segment has gone over well with cannabis consumers and with a strong distribution network of retail stores across the country, it is gaining an early advantage in the hemp market. The U.S. firm has taken a different approach from other cannabis companies that have focused heavily on growing their market share through acquisition in multiple states that have legalized recreational pot.
Charlotte’s Web has been able to generate stable profits with its organic approach so far. It has developed a strong business model in the hemp-based market which so far has been more nimble and can operate across the U.S. This contrasts its counterparts in the cannabis (THC) market that relies heavily on acquisition because there are only 10 U.S. states it can operate legally in for recreational pot and THC products cannot be moved across state lines.
But the advantage of being in the hemp-CBD market may be tempered for Charlotte’s Web, with the upcoming FDA ruling on regulations on CBD in food and supplementary products.
However so far, one of the benefits of focusing on products that are (technically) legal across the country is it’s easier to market and advertise them. Charlotte’s Web recently began trading on the Toronto Stock Exchange, which cannabis companies cannot do because of TSX rules that do not allow companies to be listed who are not compliance with U.S. federal law.
And another advantage for Charlotte’s Web is it can sell its products through larger e-commerce platforms, as outlined by the CEO:
Charlotte’s Web is taking advantage of a growing segment of the market where it can so far freely expand its business. Depending on the ruling of the FDA on CBD products, the company is so far taking advantage of being able to move its hemp-derived products across state lines and enjoy economies of scale. But the company is sure to be watching the FDA closely as it mulls CBD regulation.
But for now there’s potential for Charlotte’s Web and these new products will help the company’s sales continue to grow.