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Amid the growing popularity of the monthlong alcohol fast known as Dry January, cannabis sales are ticking up as participants embrace a new way to unwind. Overall, alcohol sales nationwide fell 52% in the first few weeks of 2024 at the country’s largest liquor chains – LiquorBarn Co., Total Wine & More and BevMo!, making it the “driest” January since the start of the pandemic, Bloomberg recently reported.
However, the alcohol industry’s loss is becoming the cannabis market’s gain, with some of its biggest players – Verano, Curaleaf, Green Thumb, Tilray and Canopy Growth – expected to grow revenue in the first quarter by 6% on average, Bloomberg calculated.
In New Jersey, where Curaleaf has retail shops in Bordentown, Edgewater Park and Bellmawr, January was “a really strong month,” said Adam John, the MSO’s regional vice president for the Northeast.
Products like cannabis-infused edibles performed especially well, with John saying Curaleaf saw “a significant spike year over year” and expects the trend to continue. “We know that those categories are such a growing opportunity for us with people new to the space that are coming in and are canna-curious,” he said. “We feel really good about those categories in particular and really excited about how our vertical brands are driving that, as well.
“Dry January is something that’s gained a lot of momentum. We’ve seen it from our guests and our 300-plus sales associates in our three locations in New Jersey. As I travel stores, I heard a lot of the team members taking part in it and it feels like a nice transition into a conversation for people who might be newer to cannabis.”
Nova Farms, an MSO that opened its first New Jersey location May 2023 in Woodbury, also tracked an uptick in new customers last month, which General Manager Emily Cerena attributed to “cannabis newbies feeling more comfortable indulging in their curiosities.”
Some of the smaller, independent-run dispensaries across New Jersey also enjoyed a sales boost that came as the calendar flipped from Dec. 31 to Jan. 1.
Sarah Trent, founder and chief executive officer of Valley Wellness, said she was surprised to see “a real uptick in sales” during the first week of January at her Raritan dispensary.
“I thought after the new year that it would slow down a little bit for a couple of days, but it was good numbers throughout the first week,” she said.
At Egg Harbor-based Brute’s Roots, owner and President Kelly Gatto said January brought a “significant increase” in new customers, making it the best month in terms of sales and foot traffic since operations began in September 2023.
“Many people participate in Dry January to try and improve their overall health,” said Gatto. “Alcohol and cannabis obviously effect the body in different ways and many view cannabis as a more natural and healthy option.”
It’s also becoming easier to take part, Cerena pointed out. “There are dozens more dispensaries open this January in comparison to January 2023, so cannabis is much more readily available to find, especially for recreational customers,” she said. “There are also more varieties of edibles and drink enhancers available to buy in New Jersey that offer green alternatives to customers looking to replace their after-work glass of wine or brew.”
Into the weed(s)
Of those who are kicking off the new year with a voluntary alcohol fast and replacing it with cannabis, 34% are between the ages of 21 and 24, while 24% are in the 25 to 34-year-old demographic, according to an analysis by consumer analytics platform CivicScience.
In general, the trend of younger generations turning away from alcohol and using cannabis as an alternative has been on the rise since the pandemic. Generation Z is drinking 20% less than millennials did at their age, attributing their temperance to greater awareness of the harms of alcohol and desire to maintain good health, according to data from Statista Consumer Insights.
More likely to perceive cannabis as being less harmful than booze, the younger set is making marijuana their preferred social lubricant. And, as more states legalize it for medicinal and recreational purposes, nearly 70% of 18–24-year-olds say they prefer cannabis to alcohol, cannabis research firm New Frontier Data reported.
John said, “I think the healthy living mentality is the largest driver. We see people who will be coming from a workout class or the gym or getting ready to go to the gym — that’s just something that I don’t think was happening in dispensaries years ago. And I think that it’s kind of a trend of where things are going. Health conscious? Yes. Younger? Yes, but not necessarily. It’s really just more around the focus on health and moving away from alcohol that has been the biggest driver in the consumer we’ve seen with some consistency.”
Cultivating change
The industry is also pushing back against the narrative that those who turn to cannabis during Dry January are simply trading vices. “As a registered nurse, I truly believe that cannabis has an amazing amount of health benefits,” Gatto said. “I’ve known many people who would take prescription sleeping aids and pain medicine who have stopped due to the medicinal benefits of cannabis.”
“Also, not to mention, purchasing cannabis at a licensed state facility, such as Brute’s Roots, gives the customer a piece of mind that the product is safe, as everything is tested by a third party, state-approved laboratory. So, the first thing I would tell someone is that cannabis provides many people with sustainable alternatives to prescription drugs which are unquestionably associated with severe health consequences, including addiction,” said Gatto.
“Dry January is about acknowledging the harm that chronic alcohol consumption can have on one’s life and body. The switch to cannabis shows that it is more an off-ramp than a gateway. I’m not suggesting that cannabis use is free from consequences, just that those consequences are certainly no greater than those of alcohol, and arguably less so,” she added.
John acknowledged the stigmas that are still associated with cannabis but said he believes there has been a significant shift in recent years thanks in part to cannabis companies’ emphasis on safety and quality. The design of Curaleaf stores, as well as commitment to customer service, also plays a part in changing public sentiment away from what they expect a modern-day dispensary to look like, he said.
“We truly do operate as a retailer that knows there’s competition coming for us. We have to make sure we give the best. And I think everyone’s doing this,” said John, who continued, “Each state that goes recreational is one of the dominoes that is unlocking the stigma from some of the others. So, I can tell you when I first joined the cannabis industry two-and-a-half years ago, I was so excited to be a part of it because of the ability to help people and the ability to see the growth in the industry.
“Even two-and-a-half years later, seeing the shift in the mentality from people who may have looked at it differently compared to how they look at it now is crazy,” he said. “And, it’s been really cool to see.”
High rate of return
New Jersey’s dispensaries are confident the January sales lift is not just a blip and that they’ll be able to keep the momentum going with new products, unique experiences and stellar customer service. “Nova Farms is passionate about educating our customer base about cannabis as this is our biggest crutch in getting customers to return consistently,” Cerena said.
“If we educate and recommend the best products to meet their needs, they will be more inclined to return and either repurchase a product or try something new. The Woodbury shop focuses on creating an inviting, fun and inclusive environment in our store to further elevate the customer experience,” she said, adding that Nova Farms is one of the few dispensaries in New Jersey to offer a drive-thru.
Along with a commitment to offer safe and affordable cannabis, Brute’s Roots – which was the first independently owned grower in the state to launch product – has several operation expansions in the works, Gatto said.
“We have a big year coming up with home delivery, our indoor grow coming online – in addition to our greenhouses – and our manufacturing operations are all beginning shortly,” she said. “Brute’s Roots edibles, vapes and concentrates will also be available this year.”
John believes Curaleaf’s products and guest experience are going to continue getting new and repeat consumers to its shops. As 2024 progresses, Curaleaf will continue focusing on guest experiences in several ways, such as tweaking its new app and focusing on product innovation, he said.
“We want to continue to stay in front of all of the competition when it comes to technology … And, every single day, we are talking about what products are coming next and how we can be leading the curve there,” he said. “I think we have people in place in the business who are really going to be able to drive that. So, we take pride in that and then we continue to lead with that every single day.
“We have people coming in that have never been before and there’s such an opportunity for exponential growth. If they leave and have a great experience and they go tell a friend or tell two friends who tell two friends, ‘You’ve got to go see the team at Curaleaf,’ we know that we can continue to grow our business and we’re counting on that,” he said. “The inverse is also true. If someone comes in and has never been and doesn’t have the right experience, then it’s hard to get them to come back.
“Our goal is to continue growth and we work at it every day. We know we have a market that is still explosive and that we have growth opportunity. We also know there’s other operators coming into the space,” he said.
After entering New Jersey’s medicinal market in 2015 with its Bellmawr dispensary, Curaleaf was one of the first retailers in the state. As of February 2024, the New Jersey Cannabis Regulatory Commission’s dispensary directory lists 102 medicinal and recreational storefronts across the state.
Of those dispensaries, 40 offer both medicinal and adult-use cannabis, 12 are exclusive to patients and 50 serve only recreational customers.
John said, “With increased competition comes the need for us to continue to up our game, as well, and we need give them a really good reason to want to come back.”
Valley Wellness opened in December 2022 as the first independently owned dispensary in the state, the second to launch in Somerset County and one of the few ventures not run by a multistate operator. Now, Trent said her business is “feeling the squeeze a little bit with more dispensaries opening.”
However, she went on to say, “Overall, I am extremely grateful for our highway fronting location, loyal customers and the staff that helps run Valley Wellness on a day-to-day basis.”
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