Three Things to Know About Ontario’s Retail Cannabis Market
Premier Doug Ford and the Ontario PC government have plans to reverse the Liberal’s agenda to sell cannabis through the newly created Ontario Cannabis Store. Under Doug Ford’s proposal, cannabis will also be sold in privately owned stores in Ontario to create more of a mixed retail mode; a concept also being explored in the Western provinces and Newfoundland and Labrador.
This change in Ontario will provide private retailers with a potential customer base of over 4 million adults with varied consumption habits, making Ontario the most lucrative market for cannabis brands.
1. Expect Strong Growth in Consumption Post-Legalisation
Our Canadian Cannabis Study shows that Ontario is home to 2.4 million current users of cannabis, and another approximate 1.8 million Ontario residents show some likelihood to try cannabis post legalisation.
To gain an idea of the market size in Ontario post legalisation, we’ve applied our current consumption and spending data to potential consumers. By projecting the average amount spent and quantity purchased by current users on to potential users, we estimate that cannabis sales in Ontario alone could be as high as $3.3 billion. Ontario’s closest, yet very distant, competing province, British Columbia, shows a potential market size of $1.3 billion, just over a third of Ontario’s estimate.
2. A Mixed Retail Model Will Work Well in Ontario
Our data shows that among current cannabis users in Ontario, a mixed retail model would be a fitting approach. There’s nearly an equal preference among current users to purchase cannabis from a government run dispensary or a private dispensary. Fourteen percent of current users would still prefer to acquire cannabis from “family” or a “friend”, which we equate to the black market; however, this preference is likely to change if users have easy access to a dispensary that provides a quality retail experience.
Among potential users, there is a much stronger preference to acquire cannabis from a government run dispensary. This is likely due to greater trust and credibility among potential users for products available through government run dispensaries. However, private dispensaries can convert these potential users by positioning themselves as providing high-quality products that meet and exceed regulatory standards.
3. Key Opposing Concerns Can be Alleviated with Regulation and Education
Forty-four percent of all Ontario adults oppose the idea of cannabis retailers being allowed to operate in any commercial area. Obviously, current and potential users of cannabis are much more likely to feel otherwise.
Cannabis retailers will have their work cut out for them when setting up shop in certain neighbourhoods across Ontario. Two key concerns among those who oppose the idea of cannabis retailers being allowed to operate in any commercial area are: a concern about increased violence and crime, and cannabis being viewed as a “gateway drug” that leads users to other more harmful drugs.
While there are these strong concerns among a segment of Ontario residents pre-legalisation, substantive government regulation and cannabis education will be key to moving this opposing faction into either supporting the cannabis industry, or eventually becoming indifferent to it.
Vividata provides essential consumer intelligence to a wide range of companies including media agencies, media companies and advertisers in Canada and around the world. Offering the largest syndicated study in Canada, Vividata is the go to source for demographics, attitudes, life events, media, purchasing and brand preferences.
Vividata recently completed its first cannabis study, leveraging our unparalleled awareness of consumers and putting their opinions at the forefront. This study offers crucial research with a consumer centric view of the cultural sea change surrounding cannabis legalisation.
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Research: Lack of trust in media perpetuates belief in fake news
As appearing on the INMA blog on July 30,2018.
In partnership with Kantar, Vividata recently released the “Trust in News Study.” This study delves into how Canadians feel about their news sources in the era of “fake news,” their preferred and trusted sources, and the importance of quality journalism.
The study, unsurprisingly, shows there is a scarcity in trust with the proliferation of fake news online. While fake news is not a new phenomenon, present occurrences spread rapidly via social media platforms. As of late, the worldwide impact such fake news has had on elections and referendums has demonstrated cause for concern. Just last month, Facebook Canada even announced it will launch a third-party, fact-checking programme to root out fake news; how effective this programme will be remains to be seen.
What is fake news?
The Trust in News Study shows nine out of 10 Canadian adults are aware of the term “fake news,” but the term seems to mean several things to Canadians:
- Six out of 10 believe fake news means a mainstream news organisation has deliberately fabricated news.
- 43% believe it is a story put out by someone pretending to be a news organisation.
- 42% also believe it implies a story is factually incorrect (possibly by mistake).
The Ethical Journalism Network defines fake news best, as disinformation, misinformation, and mal-information. However, looking beyond the proper definition of fake news, one out of four Canadians say they now trust mainstream news organisations less. But all is not lost, as audiences do see the importance of quality news and journalism.
Building on a heritage of trust
Eight out of 10 Canadians believe the health of our democracy depends on journalists reporting the facts accurately. Also, half of the adult population feels people choosing to use more credible news sources is an effective way to tackle fake news. This is where traditional media, such as newspaper brands, begin to matter.
Fake news has had more of a detrimental impact on trust in digital-only news outlets and social media than it has on traditional or mainstream news. This makes sense as traditional news organisations have a greater reputation for producing quality content and have built a history of trust with audiences.
This is a reputation that should continue to be leveraged as audiences filter through what they deem credible or not.
In fact, printed national daily newspapers show 70% of their audience rates them high on trust, versus just 32% who do so for digital-only news outlets and 19% for social media.
While newspaper brands may fall slightly behind radio and TV for overall trust, when it comes to providing audiences with in-depth commentary and analysis, printed national daily newspapers come out on top.
While leveraging a heritage of trust and a reputation for providing in-depth content is crucial for retaining and growing an audience, it’s also crucial for advertisers. It’s well known ad effectiveness increases in trusted environments. Newspaper brands provide such an environment for audiences and advertisers to develop their own relationship.
Newspaper brands are the informed friend providing sound advice. Such a position is important to maintain and develop with the amount of snake oil sales that are now prevalent.