With the CBD market expected to become a $22 billion industry by 2022, it was only a matter of time before the U.S.’s third largest shopping site, Shopify, allowed hemp and hemp-derived CBD products onto its platform.
Shopify announced that, starting today, CBD sellers can now join the platform’s more than 800,000 global merchants and build a store on the company’s platform, use its marketing tools and other apps that deal with inventory management and logistics, and customize shipping for customers in different states to remain compliant. Shopify’s move comes weeks after BigCommerce, a competitor, announced a suite of tools for CBD merchants.
“It wasn’t that we had to adjust Shopify,” Loren Padelford, general manager of Shopify Plus, told Adweek. “It was this industry adjusted itself where Shopify made the most sense.”
Although CBD merchants will now have access to building an online store, purchasing Shopify’s retail kit, using Shopify’s marketing tools and more, these retailers cannot use Shopify payments to support purchases. (Third-party partners are allowed.) Padelford said the commerce platform is encouraging all CBD merchants to seek legal advice to remain compliant with FDA regulations and to adhere to the company’s acceptable use policy of the platform. Shopify Fulfillment Network, announced at Shopify Unite earlier this year, will not be available to CBD retailers either.
“It’s important that we provide a platform that’s safe and transparent,” Padelford said.
Padelford said Shopify’s been thinking about this move for a while; the company is based in Canada, where cannabis became fully legal in 2018. However, Padelford said the company was monitoring the situation as the U.S. moved through the motions, first passing the Farm Bill in 2018 that legalized hemp and made CBD products legal to sell and consume.
Some brands that are on the Shopify platform currently include Cannuka, which is sold in Ulta stores, and Josie Maran, which is sold in Sephora.
“Shopify taking a stance of support for the CBD industry is going to push this entire category,” wrote Michael Bumgarner, founder of Cannuka, in a statement. “Shopify coming out [to support CBD merchants] will be a huge step in the right direction. With Shopify and other large companies leading the way, saying ‘We’re for this; this is happening,’ I see things changing even more quickly in the near future.”
Padelford said Shopify worked with brands like Cannuka (which has been on the platform since 2017) to figure out what these companies’ needs were in terms of creating a store or marketing.
“You had a lot of folks out there who wanted to create online stores, but there’s never a platform that could support what they wanted to do,” Padelford said. “What we are doing is showing up now as Shopify [and saying] the same thing you watched fashion retailers get access to, you can have as well, and create the same direct-to-consumer, highly personalized experiences with the unique attributes. The nuance isn’t that Shopify is getting into CBD; CBD is getting into retail.”