Water Bottlers Move to Protect Sales
By Bernice Hurst, Managing
Partner, Fine Food Network
It’s beginning to look
as if consumer decisions to vote with their purses are to be contested
by companies whose sales of bottled water have fallen significantly in
recent months.
The reasons for falling
sales have been well covered – tap water is cheaper, doesn’t have
to travel so far and doesn’t come in plastic bottles that take up space
in landfill sites. But three of the biggest companies supplying U.K. retailers
have joined forces to fight back.
According to a report
on foodanddrinkeurope.com, Danone Waters,
Highland Spring and Nestlé Waters have got together to form a Natural Hydration
Council. The article explained that the council is "designed to spread
the word on the economic and social value of their product, amidst continuing
pressures surrounding its alleged environmental impact." It plans
to "provide ‘authoritative’ information and advice for researchers,
government, industry and consumers."
Paolo Sangiorgi, managing director of Nestlé Waters UK, is quoted
as having said, "Not many people realize that natural bottled water
comes from fully sustainable sources and in recyclable packaging. We need
the council to undertake new research and communicate the facts to ensure
fully informed consumer choices."
Nick Krzyzaniak, managing director of Danone Waters
UK & Ireland, added that the council will provide consumers
"with an informed choice on the health and sustainability aspects of
naturally sourced water."
Consumer analyst Zenith
International predicts that sales of bottled water are still growing, however,
partly due to innovation and added value. As long as consumers believe
that the quality of bottled water is better than what gushes from their
taps, they will apparently continue to pay for it. It is this on which
the new council will focus. How to tailor arguments for consumers who are
more sensitive than usual to every penny they spend may present an additional
challenge.
Discussion question:
How much difference will industry marketing efforts make to bottled water
sales? Do you think the strength of bottled water as a product category
will fade, hold steady or grow?
Why pay for something in these troubled times when you can get the same product virtually free? In the UK, where bottled water is almost always served when dining out, it may be easier for the water council to market its products. The same cannot be said about the US.
Even though bottled water may come from a sustainable source, there still is energy used to make the bottles, bottle it, deliver it to retail, take it home, collect the used bottles, recycle them and deliver the new bottles to the bottling facility.
The water industry will continue to market their wares. Some consumers will continue to buy bottled waters, both enhanced and plain. Coming off the current recession, their sell will be more difficult.
I worked for a bottled water company for a short stint and the lesson I learned is that the practice is not sustainable in the long run, and looking out to future water issues, bottled water for retail isn’t the best environmental policy. I think between consumer budget and consumer awareness, bottled water manufacturers are going to be hit hard and we’ll see a lot of consolidation of smaller bottlers into larger conglomerates–which in retrospect, is too bad because it’s the smaller IBWA members who are really trying hard to be good stewards of their water sources and the environment.
What better time to condemn and abandon plastic water bottles than when one’s wallet is emptying. It’s then we return to the faucet where once we drew our needed, less-expensive liquids.
Bottled water in the U.S. is a packaging convenience, first and foremost. To the extent that continues to have utility (e.g. when I’m on a gas stop on the road) it will continue to sell. But I think the days of “bottled is better” are over.
Bottled water in most developed countries is largely unnecessary, therefore to manufacture packaging for a resource that is typically considered “scarce” and then to utilize additional scarce resources in its supply chain is arguably very wasteful.
Furthermore, no amount of marketing will likely change consumers who may turn away from bottled water in those markets where there is an alternative, especially in today’s tough economic climate.
The growing popularity of SIGG aluminum and other similar water bottles signals a tougher sell for bottled water. The convenient packaging problem for water on the go largely solved, the list of reasons to buy has grown quite short.
While bottled water bottles are “recyclable,” the vast majority of them are not, in fact, recycled. While consumers may be shying away from the extra expenditure of bottled water now, over the long term, the environmental consequences are going to be a huge issue.
The largest impact that I know of is the Great Pacific Garbage Patch.
Maybe if enough consumers start to realize the consequences of all this plastic packaging, a consensus will build around cleaning the mess up and developing packaging that isn’t so clearly harmful.
Even if the manufacturers can convince consumers that bottled water is better for them and that the bottles are not bad for the environment, consumers are tightening their belts. They don’t have the expendable incomes they had before and the environment gives them a convenient excuse for ordering and drinking tap water.
Economic pressures, environmental concerns, alternative methods of making sure what one is drinking is clean and pure for a lot less money than bottled water all portend a major slowdown in the sale of bottled water. The bloom is off the rose….
The bottles aren’t even the #1 waste. For bottled water, it’s the distribution: fuel, labor, real estate and time. Isn’t it interesting how many big businesses are based on stuff folks could just as easily provide for themselves? How hard is it to fill an insulated container with tap water and ice? How hard is it to make coffee for yourself? Or cook a hamburger? Or fry an egg?