As the lack of federal approval for CBD has pushed many infused brands to branch out beyond the hemp-derived ingredient to expand their businesses, Shimmerwood Beverages is doubling down.
Launched in 2021, Boston-based Shimmerwood produces a line of seltzers made with fruit shrub, bitters and 5 mg of full-spectrum CBD per 11.5 oz. can. The drinks come in Just Hemp, Ginger Orange, Razz Lime and Chai Cherry flavors – the latter an LTO the brand brought back this year made with a chai shrub containing functional chaga mushrooms. Shimmerwood is available online for $40 per 8-pack and around 100 retail stores in New England for $5 per can.
The bulk of Shimmerwood’s sales come from direct-to-consumer purchases and according to co-founder and VP of marketing Josh Ahadian, the small startup – run almost entirely by its three founders – had been facing more demand than it could keep up with at the beginning of this year.
Leaning into positioning as a non-alcoholic alternative, Shimmerwood has grown its consumer base with younger shoppers who are looking for functional mocktails and marketed around the occasion. In December, for example, the brand sold a mixology holiday gift kit featuring its drinks.
“The ingredients in there are ingredients that a bartender would use to make a typical cocktail,” Ahadian said. “It can become this item that is appealing from its form factor because it’s in the 12 oz. sleek-style cam that you might see from a typical hard seltzer or modern seltzer. So it can fit in with the crowd.”
But limited by its production capabilities, Shimmerwood slowed its retail expansion as sales rose last year. Now, a move to a new co-packer in Maine this past spring has helped the company to increase production and support a planned rollout into the New York market.
“[Production is] more or less running on a quarterly basis at this point,” Ahadian said. “We’re hoping to keep that trajectory going … and hopefully continue to increase as we get into some larger locations and more locations overall.”
That rising demand has been boosted by media recognition, Ahadian added: in May, Shimmerwood was named one of the best CBD drinks of 2023 by Forbes.
Like their competitors in the CBD beverage category, Shimmerwood has been limited in what accounts it can get into, given the lack of federal regulation surrounding the use of CBD in food and beverages. Ahadian said the brand has managed to thrive, however, in independent grocery stores, specialty, bars and restaurants, and cannabis dispensaries.
Due to varying state regulations, Shimmerwood is only available in dispensaries in Maine, but Ahadian has said the channel’s high foot traffic has been good for the brand and the company has invested in dispensary marketing to educate consumers and dispensary staff on the benefits of a non-THC, CBD-only hemp drink.
“I think the typical customer who goes to a dispensary is looking mostly for THC products, that’s what they expect when they go to a dispensary,” he said. “So it’s been an education piece with the bud tenders and with the staff at dispensaries.”
Ahadian said the company hopes it can encourage some of its dispensary partners to eventually offer bundle deals as well: “If somebody’s coming in to buy a pre-roll or something like that, they could always have that be a bundle – a pre-roll in one hand, a can of Shimmerwood in the other is a great combination.”
While Shimmerwood’s retail business is still small, he noted that it is fast growing, going from just around a dozen stores in 2021 to over 100 today. While the company has seriously considered introducing a non-CBD line, or even a THC line that could help it to more quickly scale up in the dispensary channel, Ahadian said that Shimmerwood is looking at their competitors’ moves away from the category as all the more reason to go all in.
“We’ve certainly discussed [non-CBD lines] but I think where we are positioned right now is that, if our competition is going to pivot out of it, then it’s more opportunity for us to own that market,” he said. “I think we would be doing a disservice to pivot out and spread our already small team even thinner into another product category.”