A wave of infused beverage brands flooded the market over the last few years. Now, the sector has entered a period of settling and reassessment, as operators pause to evaluate the real opportunity and determine the smartest path forward amid ongoing legal uncertainty.

While adult-use cannabis markets continue to struggle with launching beverage brands for structural reasons, states without adult-use dispensaries are normalizing THC consumption under the radar through hemp beverages in everyday social settings. Bars, restaurants, music venues, and event spaces are increasingly embracing hemp drinks as a familiar, socially acceptable option. Minnesota helped pave the way for normalizing THC consumption outside of dispensaries, and cities like Austin, Nashville, and Atlanta are following suit by allowing hemp beverages in traditional social environments.

To understand how seasoned operators are thinking about the new year, I spoke with Evan Eniman, one of the founding members of Snoop Dogg’s Casa Verde venture capital firm and a partner in the beverage company Iconic Tonics. Iconic Tonics represents Snoop’s Do It Fluid and Doggie Spritz beverages, as well as the Klaus brand from well-known mixologist Warren Bobrow. Eniman shared how the team is thinking about brand building, product development, and long-term strategy heading into the new year.

Your Story Matters

The most common advice from branding experts is simple: tell a story.

Snoop Dogg’s drink line is built around his decades-long legacy in cannabis culture. The Klaus brand’s reputation in the cocktail world brings a different, but equally intentional, narrative to the portfolio. As Eniman explains, “It’s Warren’s craft and his creativity around all things beverage that really stands out. His products are designed to reflect a true cocktail experience, using unique ingredients and pairing them in a way that tells a story. Every drink tells a story, whether it’s about the ingredients, how it’s prepared, or who you’re sharing it with.”

Bobrow formulates products aimed at regional preferences, tailoring flavor profiles to the tastes, interests, and cultural references of each market. In New York, the Klaus line has performed especially well despite limited marketing support. According to Eniman, that success reflects how closely the formulation’s sophistication aligns with New Yorkers’ palates.

“I think about everything from the perspective of the user and the occasion,” Eniman says. “The brand has to live in that experience with the consumer.”

Finding the Right Cultural Partner to Connect With Consumers

With traditional cannabis marketing heavily restricted, brands are forced to think creatively about how they reach consumers.

“We look for culture fit partnerships as a way to connect with consumers who are already seeking these ingredients, formats, and experiences,” Eniman says.

Those partners might be restaurants, live music venues, or other spaces where education and discovery about cannabis drinks can happen naturally and fit into social occasions.

For example, Iconic Tonics recently partnered with The Butcher’s Daughter and its music listening bar concept, Only The Wild Ones, with locations in New York, Austin, and Los Angeles. They launched Warren Bobrow’s terpene-only drink, Nein, to play into the non-alc movement taking over bars.

“Their entertainment arm, Only The Wild Ones, made it a natural fit. Now the drink lives on the menu, and consumers can experience a ready-to-drink cocktail infused with botanical terpenes in a setting that matches the culture,” explains Eniman.

By embedding the product within an established lifestyle brand, Iconic Tonics can introduce consumers to terpenes through a more natural process rather than heavy, education-focused marketing.

A Slow and Measured Approach to Market

Many beverage brands are racing to market, prioritizing early scale and short-term revenue growth to satisfy investors. Iconic Tonics is taking a different path.

The company is intentionally moving low and slow, placing brand development and long-term relevance ahead of rapid expansion.

Eniman has been observing and participating in the functional ingredients market since its earliest days and believes the category is still in its infancy. “We are barely scratching the surface of what functional beverages are,” he says. “There’s another 40 years of category building ahead of us, including infused beverages.”

“These are moments in time where real brand legacies are built,” Eniman continues. “They are opportunities to change consumer behavior, routines, and expectations. Functional beverages represent far more than what we are currently seeing.”

The Tip of the Iceberg for Functional Ingredients

Eniman sees terpenes as only one entry point into a much broader functional beverage ecosystem. While hemp, particularly THC, dominates the market due to strong consumer demand, it is also creating a pull for more differentiated functional products.

“Many hemp brands today are simply THC brands,” Eniman says. “That’s who they are. That’s what they do. But when the landscape shifts, they realize they may not actually have a brand or even a business.”

Iconic Tonics has been experimenting beyond cannabinoids with ingredients like kanna, a succulent plant native to South Africa that has been used for centuries for mood elevation and stress relief.

Kanna is part of the company’s partnership with The Butcher’s Daughter, where it is being introduced in New York, Los Angeles, and Austin. While still largely unknown to U.S. consumers, Eniman points to the significance of kanna’s deep cultural and historical roots in crafting stories that help build brands.

“These ingredients are similar to cannabis in that they’ve been used for thousands of years in different cultures,” he explains. “They’re finally taking hold here, much like other superfoods that entered the U.S. market over time.”

For Eniman, it’s less about chasing market size and more about connecting consumers to purpose-driven consumption. Just as people drink coffee for energy or turn to adaptogens for mental balance, functional beverages will increasingly be chosen based on desired effect and occasion.

“The size of those markets is unknown,” Eniman says. “But the function of what you’re drinking, the access to it, and the availability are shifting rapidly. That’s what’s exciting right now.”

Why Hemp’s Strategic Advantages Are Hard to Ignore

For beverage brands, hemp currently offers strategic advantages that the regulated market cannot match. The ability to build awareness beyond state borders, access traditional retail channels, and experiment with formulation at scale makes hemp a more attractive platform for brand development.

Regulated cannabis beverages remain constrained by limited sales channels, fragmented manufacturing and distribution requirements, and operational costs that make true craft formulations difficult to sustain. Cold-chain challenges, additional taxation, and limited retail shelf space further constrain growth.

Hemp, by contrast, allows brands to plan and execute nationally or selectively across key markets while reaching consumers in familiar settings like liquor stores, convenience stores, restaurants, and event venues.

“Beverage brands aren’t putting serious money into the regulated cannabis space right now because they can build in hemp,” Eniman says. “It’s the same cannabis consumer, but with a much wider audience.”

In Eniman’s view, the infused beverage category still has work to do on formulation, education, and normalization. Looking ahead five years, Eniman imagines walking into the same types of restaurants, bars, and lounges he frequents today, but with a back bar that features not only fine spirits, but also non-alcoholic and functionally infused THC options. “I don’t necessarily want an only THC experience confined to consumption lounges,” he says. “It’s not what consumers want, and that’s the big shift.” Creating familiar, culturally integrated, and purpose-driven experiences for consumers, wherever they choose to drink, is the future.

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