What is the economic potential of CBD in Europe?

What will Europe's CBD in 5 years? Although the market has been developing over the past few years on the basis of laissez-faire and laissez-aller attitudes, and has been evolving on the bangs of regulations, it now weighs in at a few hundred million euros and is whetting the appetites of even the strongest players, to the great displeasure of the authorities who, having failed to react in the first place, are now forced to enact rules to contain a market that is full of hope and difficult to quantify.

Estimates are circulating, however, based on the current state of the CBD trade and the possibilities of opening. In 2019, the Brightfield Group, a data analysis company dedicated to industry, estimated the CBD market in Europe to €285 million and forecast growth of 400% by 2023, or €1.4 billion.

«CBD is just starting to take hold in Europe, with product availability and consumer awareness still fairly limited. This is a great opportunity for developed brands to enter and expand across Europe with much less competition than in the US. With Novel Foods regulations, it's a complicated legal environment to operate in, but impending regulatory changes should facilitate significant growth in the medium term,» explained Bethany Gomez, Group Managing Director.

In the same report, Brightfield recalled that the UK and Austria are currently the biggest markets (€80 million each), that regulations on product quality will boost consumer confidence, and that the main distribution channels are non-specialized stores, especially in countries where CBD is regulated like tobacco.

In 2019, New Frontier Data, another business intelligence, a examined European exposure to CBD.

«There are over 500 million potential CBD consumers in Europe,» said Giadha Aguirre de Carcer, founder of New Frontier Data. «The potential for CBD applications has developed enormously across Europe over the past year, creating significant opportunities to build transcontinental brands. However, the successful development and launch of new CBD-based products will require a much deeper and more granular understanding of CBD consumption across not only age and gender groups, but across different countries in what is a very socio-economically and culturally diverse region.»

The report's conclusions include the following:

• No company has a brand awareness higher than 10% among European consumers, indicating the immaturity and fragmentation of the market.
• 56% of respondents report having heard of CBD, compared to 16% who report having used CBD or CBD-based products
• The most frequently indicated reason for using CBD is pain management (40%), followed closely by relaxation (34%) and stress relief (31%).
• 42% of CBD consumers report substituting CBD for an over-the-counter drug
• Nearly a third (30%) of European consumers say they spend more than €100 a month on CBD products
• 35% of CBD users say they get at least some of their CBD from friends

Market projections will depend heavily on future CBD regulations. Depending on the type of product, different risks - or opportunities, depending on your point of view - need to be anticipated: regulations Novel Food for CBD in food, the CosIng for cosmetics, or simply the raw or extracted use of hemp flowers.