Life & Health in motion

March 17, 2020

Los Angeles CA.

Life and Business after Corona Covid-19 Virus

CBD-CPG Companies E-Comm business surges during Crisis

By John Cammarano

Like so many business professionals, employers, and employees across every industry and socioeconomic class in the country, I am dismayed.  Fear of the unknown and the welfare of our loved ones as well as what the future will look like for the most powerful country in the world is of the utmost concern for Americans. As a business leader and admitted workaholic, I find myself sitting and pondering how to apply my skills to understand the crisis, create solutions that lead to revenue streams for the company I work for, and forecast what business and life will look like post the Covid-19 scare. Yes, I admit it, my head is always creating products, marketing strategies, or solutions to the economics of the company. My faith in American ingenuity and humanity overall ensures me that we will come out the other side of this situation and possibly even stronger as a more unified economy and culture. This is my justification for working through the crisis while observing and identifying opportunities.  

Things are going to change.  In a post Covid-19 America so many things are going to change about how we conduct business, family finances, and preparation for calamities and disasters. Personal interaction and touch will take a major hit. Supply chains and manufacturing country of origin will start to experience complete overhauls. If we continue to rely on China for the majority of our medications after this, maybe we aren't as great as we claim.  

We could dive deeper into commentary on strong leadership and even the toxic and polarized political environment that still permeates our social and media culture during a worldwide pandemic, but I am a product and brand strategist guy and that would be above my pay grade. 

What does all of this have to do with CBD products and E-Comm?  “Health,” “well-being,” “stress,” “pain,” “immune system,” “inflammation,” and “restful sleep,” are all buzz words that float around in correlation to CBD products. Although the science is still in its early stages, the anecdotal evidence is staggering, and the American consumer knows this.  

I have witnessed the preservation of discretionary dollars and subsequent routing of those dollars to only necessary items like food, gas, and emergency travel. We have all seen the depleted shelves at food stores, the mass psychological panic, and the re-positioning of priorities and perspectives during this ordeal.

Sales prior to the Covid-19 situation were strong and quite consistent on our site. Revenue multiples on conversion were always reliable on a daily basis. The outlier question was discussed earlier: How will this event affect sales of CBD products and what does Sera Labs need to do in order to pivot to this "New World" post Covid-19? Answer: With no expansion of expenditures or modification to digital and radio creative, we have experienced more than 4 times lift in consumer sales. So, don't fix it if it isn't broken. My earlier fears that consumers would pass over the CBD category, altogether, were seriously flawed.  

The results can be explained by increased purchases from existing loyal customers who see CBD as a necessity and fear product shortages and delivery delays. They feel compelled to load up on supplies. More importantly, our customer base expanded and these new clients have been the dominating customer group over the last ten days. Each day, orders continue to grow with no digital expansion. Word of mouth combined with lower resistance to purchase is a powerful thing. It is important to note that this rate of sales growth covers both topical, beauty, and ingestible CBD products that Sera Labs sells.

What does this tell us about CBD products overall? My confidence level is not only preserved in the growth category on the CPG side, but completely bolstered with respect to consumer awareness growth. If consumers are putting CBD products on the same level as basic necessities, post-Covid-19 business for this CBD marketer looks strong. We have been collaborating with multiple brands that have witnessed this sales phenomenon as well. During trying times, certain markets push trends towards specific categories. The perfect example is consumer fear that our everyday pharmaceuticals run the risk of being hard to get coupled with the fact that the bulk of their ingredients are made in China. Notably, most CBD is harvested and manufactured in the U.S. Of course, consumers know this as they seek alternative products for all those buzz words mentioned earlier. CBD may be their perfect safe harbor.  

Finally, as our sales scale during this horrible period, new users of CBD products will realize the benefits and join the ranks of loyal cannabidiol consumers. Talk about making lemonade from lemons!

About the writer:

John Cammarano is currently lead brand strategist for Sera Labs Inc.  and has developed over a dozen consumer branded products throughout his career spanning over 25 years resulting in over 2 Billion dollars at retail.