Long has it been assumed the alcohol and tobacco industries are opponents of widespread marijuana legalization. The reason is simple—the availability of legal cannabis can cut into their market shares. A new study supports the theory as interest in alcohol diminishes following marijuana legalization. But for reasons that remain unclear, tobacco sales have increased at the same time as alcohol sales drop.
Utilizing data collected from “a leading U.S.-based web portal,” researchers at University of Georgia’s Terry College of Business sought to better understand how marijuana legalization affects various markets. Online searches between January 2014 and April 2017 revealed how the behaviors of state residents changed in terms of what they clicked and searched following marijuana legalization, as Marijuana Moment first reported.
“It appears the alcohol industry has valid reason to be concerned about legal marijuana and may need creative strategies to avoid market decline if it passes,” said co-author and assistant professor at the University of Georgia Pengyuan Wang in a press release.
Published in the INFORMS journal Marketing Science, the study revealed that online searches for alcohol dropped 11% post legalization, though tobacco products were searched almost 8% more. Perhaps most interesting is the behavior changes amongst generational divides. Adults increased their marijuana searches by 17% following recreational marijuana legalization, but youths aged 19 or younger slightly decreased online marijuana searches.
“Contrary to widely held public concern after recreational cannabis is legalized, teenagers appear to lose interest, rather than gain interest,” Wang said. “Policymakers only concerned with an uptick in teen users, may want to rethink their stance.”
This online data falls in line with a previous analysis conducted by Cowen and Co. around the changes of Canadian consumer behavior after the country legalized recreational marijuana. The number of Canadians who admitted to using marijuana in the past month jumped by 25% in some provinces. Meanwhile, Canadian beer sales dropped by 6.8% in the month of March alone.