The road to legal status has been a protracted one for CBD. From flying under the Home Office’s radar for years to fighting the disentangle itself from marijuana and cannabis, cannabidiol is finally emerging from the grey area it has occupied until recently.
CBD products now abound in the UK, which has emerged as the world’s second largest consumer of the compound. Accessibility has also vastly improved–walk into any trendy wellness shop on high street and you’re bound to find a bottle of CBD oil or candy.
But the runway isn’t quite clear yet, especially if you’re a smaller online business. Many ecommerce platforms–including Amazon–still have fuzzy restrictions around CBD. “Vendors didn't have clear policies. There were unfair rules enforced on our businesses, including unwarranted contract terminations with no notice from service providers,” says Julie Winter, Vice President of CBD for Life.
Restrictions are bound to ease as regulations settle and more products obtain Novel Foods certification. Right now, however, choices are limited to building your own site, using a store hosting platform, or taking your chances on Amazon.
CBD’s Astonishing Online Growth
Some argue that CBD products are perfectly matched for the era of eCommerce, with huge potential audiences, strong, consistent margins and inventory that is easy to store and ship.
Looking at public interest in both over time, we can see that CBD and eCommerce indeed have a tight correlation, with open-mindedness about online shopping aligning well with demand for CBD products.
Independently, CBD’s global growth can be seen by taking a look at Google’s historical search data for the past two decades:
2004 - 2016: During this period CBD was largely unknown, and awareness of its benefits was very slow to spread and be accepted. It took over 10 years between 2004 and 2014 for public interest in CBD to double. This was mainly due to the legal restrictions and stigma associated with cannabis and its derivatives.
2016-2017: In just the two years of 2016 and 2017, global search volume for CBD doubled again! Not only did the popularity of CBD grow rapidly, but the acceleration of this growth began to reach extremely high levels. This was driven by several factors, such as the increasing legalisation and decriminalisation of cannabis in various countries, the growing scientific evidence and public awareness of the therapeutic potential of CBD, and the emergence of new products and applications of CBD in various sectors.
2019: Doubling again in a single year, public searches for CBD reach their all-time-high. This reflects the peak of curiosity and interest in CBD among consumers who were learning about CBD for the first time, as well as an elevated availability and accessibility of CBD products in different markets.
The global cannabidiol market size was valued at USD 2.19 billion in 2019 and exhibited a CAGR of 46.4% during that year.
2020-2023: Public search volumes for CBD slow in growth, as many consumers now understand CBD, and have selected long-term suppliers and retailers that meet their needs.
Global CBD market size continues to expand annually, despite the challenges posed by the COVID-19 pandemic. The global cannabidiol market size was valued at USD 5.18 billion in 2021 and is expected to reach USD 39.99 billion by 2027, exhibiting a CAGR of 16.8% from 2022 to 2030.
In this modern era, the key drivers for growth now often include medical applications of CBD in treating anxiety, stress, sleep disorders, chronic pain, migraine, skin care, seizures, joint pain & inflammation, neurological conditions and others. The changing regulatory landscape now sees CBD as a fully legal product in the majority of countries across the world - even many with strict drugs laws.
Historically Restricted
Historically, many eCommerce platforms have restricted the sale of CBD products due to regulatory concerns and the complex legal landscape surrounding the industry. However, given the growing popularity and demand for CBD, this landscape is expected to change in the near future.
Currently, some eCommerce platforms still restrict the sale of CBD products, including major marketplaces like Amazon, eBay, and Etsy. Amazon, for instance, has recently started a pilot program for CBD sales in the UK market, signaling a potential shift in its stance. As more products acquire their Novel Foods certification, it is likely that additional platforms that have previously imposed restrictions on CBD sales will follow suit and embrace the CBD industry.
Until these changes occur and the regulations become more clear, sellers can navigate the complex and often unclear regulations by hosting or building their own websites, offering them more control and flexibility in conducting their CBD businesses. This approach allows CBD sellers to operate within the evolving legal framework while still reaching their target audience and capitalizing on the growing demand for CBD products.
Where aren't CBD Ads banned?
The restrictions on CBD sales extend beyond eCommerce platforms, as popular advertising channels like Google Ads and Facebook Ads have also imposed limitations on the promotion of CBD products. This has presented additional challenges for CBD businesses looking to reach a broader audience and grow their market share.
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Google Ads: Google's advertising platform has historically prohibited the promotion of CBD products in their ads. This is because Google classifies CBD under its "unapproved pharmaceuticals and supplements" category, which prevents businesses from using its advertising services to promote these products. Google has recent started experimenting with limited topical-CBD ads in California, but there are no current plans to expand this program.
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Facebook Ads: Similarly, Facebook Ads has maintained a strict policy against the advertising of CBD products on its platform. As per their advertising guidelines, Facebook does not allow ads that promote the sale or use of illegal, prescription, or recreational drugs, which currently includes CBD products.
These advertising restrictions have led CBD businesses to explore alternative marketing strategies and channels to promote their products. Some common alternatives include influencer marketing, content marketing, search engine optimization (SEO), and email marketing, which can help businesses reach their target audience and grow their customer base without relying on traditional advertising platforms.
On Reddit, CBD advertising is allowed only for topical and non-ingestible hemp-derived CBD products in the US, subject to various conditions. Twitter permits approved cannabis and CBD advertisers to target specific regions like the United States, Canada, and Thailand, with each country having its own set of requirements.
Meanwhile, TikTok has completely banned CBD ads on its platform. Snapchat, on the other hand, allows CBD advertising but enforces stringent rules, such as:
- Ads cannot show cannabis, hemp, or CBD products or display related terms.
- The advertisement cannot depict people enjoying the effects of CBD or show them in a positive, uplifting light.
- Descriptive language suggesting any benefits of CBD is not allowed, even words like "chill out," "relax," or "relief."
- Testimonials and endorsements are prohibited, as well as any mention of awards or media recognition.
- Promotional offers for CBD products are not allowed.
These advertising restrictions have led CBD businesses to explore alternative marketing strategies and channels to promote their products and reach their target audience.
What channels do work well for CBD?
To circumvent the advertising restrictions imposed by popular platforms, CBD businesses have turned to alternative marketing strategies such as SEO, email marketing, affiliate marketing, and influencer partnerships. These methods enable companies to reach their target audience without violating the rules of mainstream advertising channels.
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SEO (Search Engine Optimization): SEO involves optimizing a website's content and structure to rank higher in search engine results, driving organic traffic to the site. However, the challenge for CBD businesses lies in the fact that Google does not provide keyword data specific to CBD. This makes it difficult for marketers to identify the most effective keywords to target. To overcome this, businesses can conduct extensive keyword research using third-party tools and focus on long-tail keywords and industry-specific terms.
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Email Marketing: By building and nurturing an email list, CBD businesses can directly communicate with their customers and prospects, share information about new products, promotions, and industry news. Email marketing allows businesses to maintain an ongoing relationship with their audience while avoiding the limitations of traditional ad platforms.
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Affiliate Marketing: Partnering with affiliates allows CBD businesses to tap into their networks and reach new customers. Affiliates promote the company's products in exchange for a commission on each sale they generate. This approach enables businesses to extend their reach without directly advertising on restricted platforms.
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Influencer Partnerships: Collaborating with influencers, especially those with a niche following in the wellness or alternative medicine industry, can help CBD businesses promote their products through authentic and relatable content. Influencers can share their experiences with the products and indirectly endorse the brand, giving it credibility and exposure to a broader audience.
By leveraging these alternative marketing strategies, CBD businesses can effectively bypass the restrictions imposed by mainstream ad platforms, and continue to grow their customer base and brand presence.
What Are Major Online Retailers Doing?
Amazon
Amazon’s stance towards CBD is still restrictive. The term “CBD” is prohibited and using it anywhere in your listing can get it suppressed. Some sellers try to work around the restriction by using “hemp extract” instead, which the platform allows. But even that tactic isn’t a guarantee that Amazon’s algorithm won’t sniff out your product and take it down.
Yet CBD’s grand, legal debut on the platform is a question of when, not if. The £690 million-market is just too big to ignore, even for Amazon. Just last February the eCommerce giant announced it was running a pilot test for CBD sellers in the UK.
Experts say the experiment can only signal good news for the industry: “Thanks to the legal clarity relating to CBD in the UK, we are likely to see more major retailers getting involved,” says Leila Simpson, Head of External Affairs at the UK Association for the Cannabinoid Industry.
Ebay UK
Like Amazon, Ebay is a hazy and unwelcoming place for brands. Search for “CBD” and you’ll get numerous books on CBD and odd merchandise like prints and flags–yet not one oral or topical CBD product. Consumers will have to do a little digging to actually unearth CBD products, which may mean they’re not getting indexed properly by the platform.
There’s no explicit guideline that prohibits CBD. Yet many sellers who have actually managed to sell through eBay find their products getting banned, allegedly because they’ve been reported.
When asked why one seller’s CBD oil was taken down, the platform responded that while it acknowledges that CBD is legal in the UK, it has yet to receive “any such information from the government bodies informing the same”. Which government body they’re pertaining to isn’t clear.
Greener Alternatives
Where the two biggest ecommerce platforms are dragging their heels on letting CBD onto the market, other platforms are capitalising on their reluctance.
Holland & Barrett, one of the UK’s oldest and largest health and wellness chains, completely allow the sale of CBD in their stores. It’s online shop has an entire category dedicated to CBD. Brands can register as suppliers by submitting their products for review.
Mellow is another marketplace that has budded in the abscence of larger online retailers. Launched back in 2019, the platform now hosts more than 70 brands. However, it should be noted that Mellow currently only partners with brands, not resellers or retailers.
Self Hosted and Built Stores
Specialist marketplaces like Holland & Barrett and Mellow are great for established brands, yet may still remain out of reach for smaller businesses and resellers. The solution? Create your own store whilst waiting for mainstream retailers to figure out their stance on CBD.
WordPress
Self-hosted platforms offer the highest degree of freedom for CBD brands. Using CMS systems like WordPress, sellers are free from the limitations of ecommerce platforms that have yet to decide how they want to approach CBD beyond blanket bans.
However, using these tools requires a working knowledge of coding. Sellers without will have to hire website designers to put the site together. It’s also important to note that while WordPress allows the use of its CMS system to develop your online CBD store, it will not host it for you.
Shopify
Shopify, which once only allowed US-based CBD brands to use their hosting platform, now appears to be relaxing rules to allow international sellers. Provided, of course, that products are “in compliance with all applicable laws and regulations” and do not contain more than 0.2 percent of THC. In the UK, applicable laws and regulations may translate to a Novel Foods certification, which the government has mandated for all CBD products.
Certain types of items are also barred from receiving payments through Shopify. Some have been able to create workarounds, yet not for products related to smoking or the actual buds of the plant. Sellers can also hire professionals who specialise in setting up payment gateways for CBD merchants in the UK.
BigCommerce
BigCommerce emerged as an early adopter in the CBD industry, welcoming CBD sellers and providing them with a powerful SaaS platform to establish their online presence. The platform comes equipped with a comprehensive set of tools that enable brands to build fully functional websites, including compatibility with various payment gateways and processors.
Platforms like Shopify and BigCommerce empower sellers to create their own online stores without requiring any coding expertise. Both platforms feature user-friendly drag-and-drop site-building functionality, making them an ideal choice for sellers who may not have technical know-how.
It's worth noting that BigCommerce is newer than many of the other platforms listed here, so if you need a specific feature or function from a custom extension, you may be better using an alternative platform with a better developed developer ecosystem. While BigCommerce have grown rapidly in recent years, they still have some way to go before they're up to-par with competition in this respect.
Magento (Adobe Commerce)
Since its inception in 2008, Magento has established itself as a robust eCommerce platform, effectively utilised by a diverse range of businesses, including those in the CBD industry. The platform's popularity can be attributed to its rich ecosystem of developers and extension-builders, which enables a high level of customization and scalability to meet the unique needs of sellers across various industries.
Magento's extensive customization capabilities make it an attractive choice for CBD businesses, as they can tailor their online stores to comply with industry-specific regulations, cater to unique customer preferences, and accommodate the rapid growth and evolving market dynamics. This flexibility is one of Magento's key strengths, setting it apart from other eCommerce platforms.
However, Magento's highly technical nature, when compared to more user-friendly solutions like Shopify, can be a barrier for some businesses, particularly those with limited technical expertise or resources. This has led to Magento being more commonly adopted by larger, enterprise-level CBD sellers who have the capacity to manage the platform's complexities, while newer upstart sellers may gravitate towards more accessible alternatives.
Despite this, Magento remains a top choice for established CBD businesses looking to create a seamless, feature-rich online shopping experience for their customers. Its comprehensive suite of tools and features enables enterprises to efficiently manage inventory, implement targeted marketing strategies, and leverage advanced analytics to drive growth and success in the competitive CBD market.
With the right support and resources in place, Magento continues to be a powerful solution for CBD retailers seeking to scale their operations and thrive in the rapidly evolving industry.
Does the type of CBD matter?
CBD, or cannabidiol, is available in various forms, each with unique characteristics and potential applications. The most common types of CBD are isolate, distillate, and oils. However, there are also other forms available such as edibles, topicals, and capsules, among others.
CBD Isolate: This is the purest form of CBD, containing 99% or more CBD and no other cannabinoids or plant compounds. It is created through an extraction process that isolates CBD from other cannabinoids, resulting in a crystalline powder. CBD isolate is often used in products where the absence of other cannabinoids, such as THC, is desirable.
CBD Distillate: Distillate is a concentrated form of CBD that contains a broad spectrum of cannabinoids and terpenes found in the hemp plant. This form of CBD undergoes a refining process that retains a range of beneficial compounds while removing unwanted impurities. The result is a product with a high CBD content and a diverse cannabinoid profile, which can be more effective due to the entourage effect.
CBD Oils: These are created by infusing a carrier oil, such as MCT oil, hemp seed oil, or olive oil, with CBD extract. CBD oils can contain varying concentrations of CBD and may be made from either full-spectrum, broad-spectrum, or CBD isolate extracts. They are popular for their versatility, as they can be consumed directly, added to food or beverages, or applied topically.
Other Forms: CBD is also available in edibles like gummies, chocolate, and beverages; topicals like creams, balms, and salves; and capsules, which offer a convenient, pre-measured dose. These products can contain any of the aforementioned CBD types, depending on the manufacturer's preferences and target market.
In many cases, laws governing CBD do not differentiate between its various forms, focusing primarily on factors like THC content and the source of the CBD (i.e., hemp-derived vs. marijuana-derived). However, regulations can vary depending on the jurisdiction, so it is crucial for CBD businesses to stay informed about the legal landscape in their target markets. This will ensure compliance and avoid potential legal complications when selling CBD online or through other channels.
In the UK specifically, the regulation of CBD products has evolved in recent years, with a focus on ensuring their safety, quality, and compliance with legal requirements. One of the key aspects of this regulatory framework is the classification of CBD as a "novel food" under the European Union (EU) Novel Food Catalogue. Although the UK is no longer part of the EU, it has adopted these regulations into its national legislation.
It is important for CBD businesses operating in the UK to be aware of these requirements and ensure that their products are fully compliant. Failure to meet the Novel Food regulations can result in legal consequences, including fines and the removal of non-compliant products from the market.
In closing
In summary, selling CBD online offers both challenges and opportunities. To succeed, CBD business owners should focus on meeting consumer demands for transparency and authenticity while navigating the unique restrictions of ad platforms. By utilizing alternative marketing strategies like SEO, email marketing, affiliate marketing, and influencer partnerships, businesses can effectively grow their online presence.
Staying informed about evolving eCommerce platform policies is essential. For now, consider platforms that cater to CBD sellers' needs. As the industry gains mainstream acceptance, more platforms will likely accommodate CBD businesses, opening further avenues for growth.
Ultimately, adaptability and proactivity are crucial for success in selling CBD online. Keep optimizing your online strategies to ensure a seamless and satisfying experience for your customers, and your business will thrive in this competitive market.
You can learn more about many of the topics discussed here in our other blogs:
To find out more about CBD, or to purchase from the UK's leading CBD distributer, visit the JM Wholesale website.
International users outside of the UK can purchase our CBD products from out international site, JM Distro.
