On the 25th of January, 2022 Thailand became the first country in Asia to decriminalize cannabis - albeit with limitations including THC levels in extracts not allowed to exceed o.2%.
Global News Wire projects the global spa market to exhibit a growth at a CAGR 6% from 2021-2026, while the Thai cannabis industry itself is projected to reach a value of 21 billion THB by 2024 (Prohibition Partners). The transformative growth of the Thai cannabis industry provides the right infrastructure for peripheral industries, such as hotels that are looking to capture value in the cannabis/ hemp boom.
Thailand now has an 'ace up the sleeve' when it comes to attracting tourists - especially when you compare some neighbouring countries like Indonesia and Singapore where cannabis possession can still lead to severe penalties including death.
When you think of 'cannabis tourism', you might think of cafes, smoking dens and specialty roadside cookie vendors - but it's more than just that; In this article, we will look at 4 different ways that Cannabis can be a gateway to new profits for hotels.
1. Hemp Based Products and Amenities
While hemp extracts may provide the most obvious use-case, hemp is very versatile. Its potential use is not limited to just hemp extracts.
"I encourage hotels to explore the applications of the entire plant." says Thanisorn Boonsoong, CEO of Eastern Spectrum Group (ESG) which oversees operations for Thailand’s largest, privately held production of high quality Cannabidiol (CBD) from hemp grown outdoors.
Hotels looking to capitalize on hemp's sustainability can integrate hemp fibers into bathrobes, pyjamas, uniforms, chairs, and any other textiles. Hemp can be used as decoration or in alternative building materials.
Thanisorn comments that "There is a cost advantage in the use of hemp in textiles and materials in the hotel industry, given the quality, breathability, and sustainability of those hemp-derived products. This use of hemp increases the value proposition of a hotel room or the brand itself because of two factors: the sustainability aspect and the experiential aspect; both of which reinforce the idea of quality."
"For the next few years, the rollout of hemp products in hotels will likely occupy a more upmarket space rather than mass market hotel chains. To make a value proposition, hotels will really need to put an emphasis on quality. Having said this, regarding profitability, hotels can reduce cost by working directly with manufacturers and their OEM partners to create products. Manufacturers like ESG can supply the raw material and work with an OEM partner to develop products, while the hotel can manage branding and placement. "
From a cost perspective, looking exclusively at extracts, there is not really an advantage at the moment as the market premium is quite high. Right now, the use of extracts is better suited to hotels with premium offerings or with a consumer base more aware and appreciative of the actual health and wellness benefits of hemp rather than the gimmick.
2. Medical Tourism & Spa Offerings
When looking at the health and wellness space within hotels, extracts can be used in candles, aromatherapy, and self-care products, while hemp roots can also be used to make natural scrubs.
Thailand is world-renowned for its use of herbal products and spa treatments. Leveraging this reputation with a novel ingredient like cannabis and developing a spa package or a health and wellness experience can be a new attraction for consumers.
While cannabis and hemp are novel, it is more than a gimmick because it truly offers wellness benefits. If a hotel can get this message across and market a holistic experience, it is possible to unlock expanded opportunities by providing consumers with new value-added services
3. Dining Experiences
Hemp is extremely high in protein, containing all the 21 known amino acids, it's high in fibre and high in antioxidants.
Hemp seeds can be consumed as is, pressed into oils for cooking, or introduced as an incredibly nutrient-dense food ingredient. Hemp seed, hemp oil, and other hemp extracts (such as terpenes) can also be used in live cooking. The series “Cooked with Cannabis,” available for streaming on Netflix, can be a source of inspiration.
4. Sustainable Tourism and CSR
The use of local hemp is a terrific way for hotels to support and tie in local agriculture. In Thailand, finding synergies between our tourism industry and our rich agricultural tradition is a profound way to share in the commercial benefit of hemp while supporting local farmers.
With multiple stakeholders sharing an interest in hemp, we can ensure the longevity of this crop and cement Thailand as a regional powerhouse in upstream-to-downstream production and hemp applications.
Hotels can use this fact in their marketing campaigns and target visitors who see value in sustainable tourism and really have a desire to help the surrounding communities.
Hotels that are close to cannabis farms and production facilities might also looking at collaborating with these local businesses and set up tours and educational experiences for domestic and international visitors.
Packaging 'Cannabis' as a Hotel
Given the devastation to the Thailand hotel industry over the past two years, the increased accessibility of cannabis can be a way to refresh Thailand's tourism industry—but not through 'smoking lounges' or coffee shops. Rather, cannabis tourism is likely to manifest in the premium/ super-premium segment and veer towards health, wellness, and medical tourism. Research has indicated a growing desire for therapeutic experiences to alleviate stress and anxiety. Hotels can capitalize on this via their spas or packages that provide relaxing experiences. Hotels in city centers or urban hubs can also participate, with the rise in 'staycations' as another trend that hotels can leverage to provide more wellness experiences—an escape of sorts from urban life.
Complementary to Thailand's herbal tradition and given growing health consciousness among consumers, hemp and cannabis is an offering that is steeped in the holistic wellness experience. There is a lot of freedom, creativity, and commercial viability for hemp in the hotel industry, in cannabis cuisine, spa treatments, and sustainability, and in support of local industries.
Hotels, positioning themselves as wellness destinations, can augment their brands using hemp and cannabis. This, along with effective consumer education and marketing can very well be growth inducing for the industry in Thailand and at large.