On the Topic of Cannabis Topicals


The arrival of Cannabis 2.0 came with a lot of fanfare last October. The legalization of cannabis edibles, extracts and topicals would open up a cornucopia of choices for Canadian consumers, and new opportunities for legal cannabis producers and retailers to expand their businesses.

Since then, a lot of focus has been on the edibles market, offering new form factors for cannabis consumers, and leading to new lines of edibles to start hitting the market (or existing edible brands offered through new partnerships).

The cannabis category that sometimes gets overlooked is topicals—that is, the various cannabis-infused lotions, balms, salves and lubricants applied to the skin, hair and nails.


The Market Potential of Cannabis Topicals

A Deloitte report on Cannabis 2.0 pegs the potential market for topicals in Canada at $174 million per year. While this is only a modest portion of the estimated $2.7 billion size of the market for “alternative cannabis products,” it also has great potential to grow, appealing to a wider range of consumers.

The Deloitte survey of 2,000 Canadian adults undertaken last year reveals that while only 7% use topicals now, 53% intend to start trying them. Edibles, topicals and infused beverages represent “a growth opportunity for cannabis-related businesses and a potential point of entry for established companies with this expertise, since current cannabis consumers tend to lean towards more traditional methods of consumption,” notes Deloitte.

In particular, topicals tend to appeal to older Canadians (55 to 75) and women. An as-yet untapped market potential has led some industry observers to predict explosive sales growth, for topicals in the near future.


More Research Needs to be Done

Anecdotal evidence for the benefits of topicals—whether suffused with THC or CBD—abounds.

But beyond personal testimonies, scientific evidence is scarce for how cannabis topicals help with skin conditions, relieve musculoskeletal pain, enhance sensual pleasure, and provide other health and wellness benefits. A few small studies, including ones for animals, show some promise but a surge of new evidence proving the efficacy of cannabis topicals would help speed their adoption, increase sales and lead to lots of new product offerings.

In the meantime, as they seek to provide topical products to consumers, licensed producers and merchants are governed by the same regulatory framework . Packaging and labelling, for example, is strictly controlled, covering prohibitions on cross-branding, necessary health warnings, a standardized way of displaying THC and CBD content, and much more.

In negotiating the strict and ever-changing regulatory landscape for legal cannabis sales, Merrco has become the secure payment-solution provider of choice in Canada. We help our customers stay fully compliant while taking advantage of easily-customizable, industry-leading payment-processing options that give them a competitive edge.

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