A perfect storm has converged on the bottled water business. I've been watching this unfold for some time now, and a recent Business Week article dubbed, Bottled Waters Lose Their Effervescence, confirms recent trends.
Why have bottled water sales that rose so meteorically, fizzled out? That perfect storm: bad press about bottled spring water actually coming from taps; backlash from green-minded consumers who have increasingly heeded environmentalists' concerns over burgeoning landfills overflowing with plastic waste; the tightening consumer belts; finally, the advent of fashionable, and refillable, water bottles in the marketplace.
Seeing this coming, a number of savvy bottled water brands have taken steps to respond to the changes in consumer demand. For one thing, some high volume brands like Poland Springs, and Nestle's other regional bottled water brands have cut down on plastic packaging substantially. By using thinner-walled plastic bottles, there have been substantial savings in materials, energy and waste.
Evian is transporting its bottled water via train rather than truck across Europe to save on energy and dirty emissions. Coke has also shown its eco-conscience by opening a bottle-to-bottle recycling plant in Spartanburg, S.C. According to the article, Coke will use old bottles to produce enough plastic for 2 billion new 20 ounce bottles every year. Good ideas.
Coke Dasani and Pepsi Aquafina brands have likewise slowed down. So, these companies are turning their attention and their marketing dollars to building the flavored and value-added water, seeing more growth and profit potential from these categories. Coke's hefty purchase of Glaceau and its Vitaminwater brand is a focal point for the beverage giant. Pepsi's SoBe Lifewater brand is seen as a high growth opportunity for Pepsico.
Regardless of all of these efforts, a new force has emerged in the water business–one that has to be reckoned with. Companies like Sigg, CamelBak, Kleen Kanteen and KOR Ideas have come on the scene with refillable bottles at just the right time. Getting consumers who are in the right frame of mind for their product, they've been making inroads. Their argument: isn't the cheapest, most environmentally friendly water available from our own taps?
Do you purchase bottled water? If so, do you purchase specific brands that are more environmentally conscious?
Do you prefer to save money and resources by drinking tap water? If so, have you purchased a refillable bottle to take with you?
What do you think the future of the bottled water category is? Do you think buying basic H20 will become a thing of the past, but that consumers will buy more flavored or value-added water in the future?
I'd love to hear from you.
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