- Jones Soda is launching a line of cannabis-infused sodas, syrups and gummies under a new brand, Mary Jones.
- It's a bold step for the publicly traded company, but its relatively small size means it may feel it can take risks that larger rivals Coca-Cola and PepsiCo are shy to try.
- The initial launch will happen in California, but the company has plans to bring Mary Jones to all states where cannabis use is legal.
Meet Mary Jones, the new brand from Jones Soda that will feature cannabis-infused sodas, gummies and syrups.
It's a bold step for the publicly traded company, which is best known for its craft soda, but its relatively small size means it may feel it can take risks that larger rivals Coca-Cola and PepsiCo are shy to try.
Cannabis is still federally illegal, and the drink giants are wary of crossing that line. The closest that Pepsi has come is its recent launch of a line of hemp-infused Rockstar energy drinks, although hemp seed has no dramatic effects when consumed.
Alcohol companies have embraced cannabinoids to a greater degree. Corona brewer Constellation Brands owns a stake in cannabis company Canopy Growth, while Molson Coors sells CBD-infused drinks made through a joint venture.
For 2021, Jones Soda reported revenue of $14.8 million, less than .04% of Coke's revenue for the full year. The company has a market value of $37.3 million and is trading at 55 cents a share.
"We're a small player in soda, but we're going to be the biggest national player when it comes to a recognizable [consumer-packaged goods] name in cannabis," Jones Soda marketing chief Bohb Blair said in an interview.
The launch also follows a broader trend within the beverage industry blurring the lines between different categories. Pepsi is moving its Mountain Dew soda into alcohol with Hard Mtn Dew, while Anheuser-Busch InBev's Bud Light Seltzer launched a hard soda variety in December.
On April 1, Mary Jones will launch in California, which has a legal cannabis market of roughly $4 billion. According to Blair, nearly a third of adult Californians shop in dispensaries, creating a huge market for its products.
While Californians are often stereotyped as health-conscious consumers who prefer green juice over soda, Blair said the existing cannabis drinks — made with low dosage and light flavor — has left the door open to consumers who want a cannabis beverage packed with flavor.
"Health claims aren't our equity, full flavor is," Blair said. "We had some conversations early on: Should we be putting CBD in this? And no, it's not who we are."
"If we crack it in California, we're going to do gangbusters as we go through the Midwest and East," he added.
The initial launch will include four different product lines: 12-ounce bottles of soda infused with 10 milligrams of cannabis; 16-ounce cans of soda infused with 100 milligrams of cannabis; syrup designed to mix with other drinks or on food with 1000 milligrams of cannabis per bottle; and gummies infused with five milligrams of cannabis, shaped like mini Jones Soda bottles.
The company has even bigger plans. It's looking to expand in all states where it's legal for adults to use cannabis and — eventually — nationwide.
"We have been putting all of these pieces in place since we announced our intention to establish a cannabis division last July, and we fully expect the brand to deliver solid strategic growth for the company," CEO Mark Murray said in a statement.
The decision to move into cannabis came about as Jones worked to expand its portfolio beyond soda. Blair said the company is confident that it will pay off, given Jones Soda's playful and recognizable branding, popular flavors that will work with cannabis and the potential appeal to new consumers.
"A lot of the cannabis category is leaf, but that's the legacy part of the category, the mature part," Blair said. "If you look at the new consumer to cannabis, the people who want to bring it to a party or have it in a meal, a lot of them are turning to beverages and edibles. And it turns out those are not as easy to make."
But selling cannabis, even where it's legal, comes with its own set of challenges. Jones Soda is betting that its expertise as an independent soda company will translate into the distribution of cannabis-infused products as well. The company is already familiar with operating on a state-by-state basis.
In California, the products will be sold in dispensaries, where the company contends that it's unlikely they'll be confused with non-cannabis versions of Jones' drinks.
The company also tried to design Mary Jones' packaging to straddle the line between benefiting from Jones Soda's brand recognition and making it different enough as a signal to consumers. The logo uses the same font for "Jones," but with the "N" backwards. Following local regulations, the products have the dosage in larger font than any other claims.
The name itself is a play on "Mary Jane," a common nickname for marijuana.
"Coke has Diet Coke, and people get that 100%," Blair said. "So we qualified Jones with Mary Jones."