Question

Topic: Strategy

Water Dispensers- Building A Value Proposition

Posted by vasudev_kamath on 1/8/2014 at 1:32 AM ET 125 Points
Water-dispensers as a product category is projected to grow at a healthy double digit rate for the next 5 years.

The key reasons for this growth is increasing urbanization and health consciousness in Indian metro cities. People have understood the importance of safe drinking water and are opting for different systems in their homes and offices to ensure it.

Our Company has been the pioneer of introducing water dispensers as a category in India. It enjoyed a healthy market leadership in this category till the foray of many local regional players in the market who ate into a significant pie of the market.

Water dispensers is an undifferentiated product category with extremely price sensitive customers. Moreover, this category faces stiff competition from water purifiers where there are several branded players.

With increasingly urban consumers looking for instant cold & hot drinking water, Our Company senses an opportunity and a marketing challenge to build a compelling proposition around the water dispensers to regain its dominant leadership position.

What are the possible innovative marketing strategies to regain dominant leadership position in the Water dispensers business in India,Asia and Emerging markets.
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RESPONSES

  • Posted by saul.dobney on 1/8/2014 at 3:29 AM Accepted
    In Europe, water purifiers would be about tap water - removing 'bad' minerals or chemicals for instance reducing limescale to make the tap water safer for use in domestic appliances. But it's still tap water which has some negative associations about source, taste, vitality etc.

    Water dispensers here are more about the quality of the water. Some just sell on purified water - but with a better taste than tap water, but it can also include where the water came from (eg mountain springs, or specially sourced like Evian), the mineral properties of the water and so how good it is. In some places showing they provide high quality water (eg gyms, spas, corporations) is as much a statement as a practical service. Personally I'd also say there a whole service proposition here since the water is delivered and the water delivery could be extended to other things.

    I'd guess you can't stop the move to purifiers for the commodity end of the market, but there are probably profitable opportunities at the quality end with suitable segmentation and targeting.
  • Posted by vasudev_kamath on 1/8/2014 at 4:41 AM Author
    Thanks saul.dobney quite an intersting insight. Appreciate your inputs
  • Posted by Mike Steffes on 1/8/2014 at 8:08 AM Member
    You asked for innovative marketing strategies...but if you have access to the engineering end of things there are value-add options such as an integral, selectable flavor dispenser. Or a shot of multivitamin additive, or even caffeine. The additive stock could be inserted into the machine like a printer cartridge.
    Something like that would get you up, out of the commodity category and into value pricing. Then there are some real marketing innovations available.
  • Posted by Gary Bloomer on 1/8/2014 at 8:07 PM Member
    Aren't you the same person who posted three student questions earlier this week, all of which were closed by Carrie, one of the forum administrators?
  • Posted by vasudev_kamath on 1/9/2014 at 3:27 AM Author
    Thanks Mike Steffes for your innovative inputs. However we would like to stick to plain water and avoid adding flavours to it in the pilot phase. What would be interesting to know in a market like India how can we reduce the logistics cost and save environment by eliminating plastic containers alltogether for storing water and then dispensing it through the dispensers for hot and cold options Would be interesting to explore as saul.dobney mentioned to directly dispense from the Tap to the dispenser and focus on quality of water with the option of hot and cold water. Is there a whitepaper, case study or a framework available on such kind of dispensers being available in the market which could help us to take us to the next level. Thank you all for your support.
  • Posted by woodspunk on 1/9/2014 at 10:26 AM Accepted
    I would try to focus on the "instant hot" side of the dispenser as money savings. For example, heating one cup vs. running the hot water from the tap for 30 seconds (or whatever). You would play to the price sensitive customer and somewhat negate the competition of the purifiers.
  • Posted by vasudev_kamath on 1/13/2014 at 2:31 AM Author
    Hi woodspunk,

    Thats a good point you have brought up. However is there a price comparision on savings that has been done to compare the savings to running tap water to heating just one cup of hot water. As in either case the dispenser power supply is always on.
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