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Amazon may offer CBD under its own brand labels. The report notes that Amazon, including Whole Foods, has a large and growing private label business. If CBD products gain popularity and acceptance, Amazon may offer its own alternatives. While this initially may threaten established CBD companies, “The widespread availability and acceptance by a retailer such as Amazon could also help to drive mainstream adoption of CBD products and thus provide a benefit for the industry as a whole.”

What’s spurring this growth is the rising number of jurisdictions that have repealed, or are not enforcing, legal prohibitions on marijuana. That, in turn, is facilitating the growth of nutritional supplements containing CBD. “This is a really powerful compound,” as Mikhail Kogan, medical director of the George Washington University Center for Integrative Medicine, told The Washington Post. “I’ve seen it work for a lot of my patients,” he added, noting that he prescribes it for epilepsy, Post Traumatic Stress Syndrome (PTSD), anxiety, autoimmune disorders, autism, and insomnia.
Amazon.com Inc. (AMZN) and eBay inc. (EBAY), two of the world’s premier e-commerce retailers, look particularly well-positioned to profit from the expanding market for CBD, a non-intoxicating substance in marijuana plants that’s seeing rapid sales growth.

What is CBD? The two principal chemical compounds in the marijuana, or cannabis, plant are tetrahydrocannabidiol (THC) and cannabidiol (CBD). THC is an intoxicant that decades of research indicate also may be effective against pain, nausea, appetite loss, and other ailments.
Growing Opportunity For CBD Supplements
In their survey of Amazon customers, Cowen found that, in each month during the fourth quarter of 2018, 19% of Prime purchasers bought at least one personal care product and 15% bought at least a vitamin or supplement product. In more than more than 30 other product categories, an average of only 12% of Prime purchasers bought anything. There was a similar trend among non-Prime purchasers, the respective figures being 13%, 10% and 8%.
Amazon’s growing physical footprint. Amazon’s health-oriented Whole Foods Markets, the grocery chain with about 470 locations, is another potential sales channel for CBD products, and the company’s expanding physical footprint also includes its Go Stores and bookstores. Whole Foods offers 2-hour delivery of many items in 63 cities which account for 50% of the U.S. population and 66% of U.S. GDP, and curbside pickup in more than 20 markets. When CBD products may appear in these physical channels is unclear, but Cowen calls them “attractive avenues for reaching new customers.”
The report projects that e-commerce will be a key distribution channel for CBD products. These fall within larger categories called personal care & beauty products and vitamins & food supplements, all of which Cowen expects to enjoy accelerating online sales.

In a detailed, 106-page study, Cowen says that products containing CBD “are now available through increasingly diverse retail channels, including Amazon, Sephora and Neiman Marcus.” They estimate retail sales of CBD products in 2018 were between $600 million and $2 billion, and will grow to $16 billion by 2025, based on what they say are conservative assumptions: a 40% increase in consumer use, plus spending of less than $2 per day per consumer.

The 2 e-commerce giants are well positioned to thrive on rapidly expanding sales of supplements based on CDB, a cannabis-based compound.