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BDSA’s cannabis market insights: Rapidly developing consumer base shows big potential for adult use in New Jersey

With just under four months of adult-use sales under its belt, the New Jersey cannabis market is off to a solid start. Per BDSA’s Retail Sales Tracking data in the Jersey market, monthly dollar sales have almost grown ~20 percent since May 2022, the first full month of adult-use sales, to total roughly $60 million in July 2022. While the market remains constrained by the current macroeconomic situation, as well as state regulations, it still holds the potential to be a top ten contributor to the growth of legal cannabis sales by 2026. Now that New Jersey has a full quarter of adult-use sales in the books, we think it would be a perfect time to share some top insights on one of the most exciting cannabis markets in the Northeast.

Coming out of the medical era, retailer access is limited and sales remain concentrated among a few brands

While reforms of the state’s medical program under Gov. Phil Murphy helped the market grow rapidly, New Jersey still launched adult-use in an industry that was more limited than other recently launched markets. With less than one dispensary per 100,000 residents, New Jersey has the lowest per capita dispensary count of any adult-use market, and legal sales remain highly consolidated, with BDSA Retail Sales Tracking showing the top three brands in New Jersey bringing in ~60 percent of dollar sales in the state from April-July 2022.

Flower holds strong in New Jersey, dabbables lag behind

Compared to other cannabis markets, flower holds a much higher share of dollar sales in New Jersey. While most cannabis markets typically see flower bringing in a ~40 percent share of dollar sales, BDSA Retail Sales Tracking data show that flower made up over 50 percent of monthly dollar sales in New Jersey in July 2022. Also notable is the unusually low sales of dabbable concentrates in the Garden State’s nascent adult-use market. Dabbables usually bring in 5-15 percent of dollar sales across BDSA-tracked markets, but brought in only a 2 percent share of dollar sales in New Jersey in July 2022.

New Jersey’s consumer base shows different priorities when choosing where to shop for cannabis

New Jersey has seen a massive expansion in cannabis consumer participation, with BDSA Consumer Insights showing that the share of past six-month consumers grew ~15 percent from Spring 2020 to over 50 percent in Spring 2022. The state’s consumer base shows several differences in store choice drivers compared to the aggregate of adult-use consumers. While vertical integration ranks toward the bottom as a store choice driver across the aggregate of adult-use markets, New Jersians evidently appreciate retailers that grow their own cannabis– 42 percent of consumers cite this as a top driver of store choice.

With limited storefront retail access, New Jersey consumers lean on delivery and legacy market

When looking at the aggregate of adult-use consumers, BDSA Consumer Insights data shows 52 percent of consumers across adult-use states claiming they bought cannabis from a recreational dispensary in the past six months. New Jersey consumers, who have more limited access to storefronts than consumers in other states, are much more likely to purchase from friends or family, or from a delivery service. Forty-five percent of New Jersey consumers in Spring 2022 claimed to have bought from a friend or family in the past six months, while 27 percent claimed to have bought from a delivery service in the past six months. While this is likely to shift significantly as the adult-use market gets its footing, New Jersey consumers are also much more likely to prioritize delivery when choosing where to shop, with 30 percent claiming that a retailer having delivery or mail order is a major influencer of where to shop, compared to just 10 percent across the aggregate of adult-use markets. 

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