The CBD industry is one of the fastest growing industries in the US and is valued at $5.18 billion in 2021. It’s expected to grow at a compound annual growth rate (CAGR) of 16.8% from 2022 to 2030, so it’s no wonder celebrities and athletes want a piece of the CBD pie.
According to Steven Hoffman, CEO of Compass Natural, some of CBD’s biggest fans are professional athletes and entertainers at the highest level. “Many have become users of CBD products and outspoken advocates, touting the reported benefits of hemp extract in the context of recovery, the stress of travel, and other unique physical and mental needs of peak performance.”
With CBD partnerships like Alex Morgan, Carli Lloyd and Rob Gronkowski with CBDMEDIC, Martha Stewart with Canopy Growth, Megan Rapinoe with Mendi, Nicole Kidman with SeraLabs, celebrities are jumping at the opportunity.
“The increase in parasocial relationships, caused by social media giving everyone more access, is a Catch 22 for celebrities. It’s this love and trust for celebrities, combined with the ease of launching and marketing dietary supplements, that has created a surplus of celebrity-endorsed CBD brands.” explained Joshua Schall, CPG industry strategist at J. Schall Consulting. “However, that doesn’t guarantee success in the CBD market, as the ability to easily articulate and aestheticize one’s defining personality traits is a skill that’s becoming more important by the day. That being said, I truly believe that the right celebrity, used in the right way to promote the right product, can be a really powerful brand attribute in today’s CPG market.”
An example of a celebrity-endorsed CBD brand is Kadenwood, a company that aims to make CBD a trusted and safe mainstream wellness category. Kadenwood developed a line of products featuring current and former professional athletes called LEVEL SELECT. The line was designed in collaboration with professional athletes and developed by doctors.
Erick Dickens, Kadenwood co-founder and CEO, said the top concerns of consumers are quality, effective products and price. “We have one of the most comprehensive Quality Assurance departments in the industry, with many certifications attesting to our high standards. Also, we are at the forefront of innovation and because of this we can produce and deliver CBD more efficiently and economically. We save costs and make a product that is more effective than other brands. We bring these savings directly to the customer by lowering our on-shelf prices. In other words, we offer consumers the most potent CBD products at the lowest price, and that matters most to them, even more than integrating with an athlete.”
“The leading CBD brand by market share, Charlotte’s Web, is very proactive in supporting research on CBD and human health. Only in the last few years, since hemp was legalized in the 2018 Farm Bill, have we seen research emerge on the benefits of cannabidiol (CBD) and the many other cannabinoid compounds found in the cannabis plant.” said Hoffman. “I believe the industry would benefit from additional research focused on athletic recovery, stage fright etc. but we are still in the early stages of market acceptance of a plant that has been banned for over 80 years.
“Consumers are absolutely interested in the science behind the products they ingest,” noted Kevin Yan, MSc, Director, Certifications and Analytics, Nutrasource. “Consumers want products that are manufactured and handled to the highest possible quality to ensure the products they consume contain only what is listed on the label and that contaminants such as pesticides and heavy metals are eliminated.”
Is a big name = sales?
One of the most cited studies looking at the economic worth of celebrities is a 2012 study in which Elberse et al. found that about 20% of all ads feature a celebrity and that endorsements boost trust. But what about the bottom line? The Harvard researchers concluded that brands can achieve a 20% to 40% increase in sales by using a celebrity endorsement.
“Celebrity announcements, and athletes in particular, are big business,” Elberse wrote. “In this study of athlete referrals, we find that a company’s decision to sign an endorser pays positively, and that referrals are associated with increased sales in absolute terms and relative to competing brands.”