The King of the Beverage Industry The bottled water sector of the beverage industry continues to march to the head of the line, although not quite as briskly as during 2016, when volume growth was 8.2%, compared to “just” 7.24% for the first half of 2017. As of October 2017, the year-to-date increase in dollar sales for bottled water had backtracked to 4%, but the total was approximately $13.2 billion. Market Research Reports forecasts the US bottled water market will total $22.5 billion by 2024. Industry experts state many other beverage sub-categories would like to achieve a similar performance; however, it’s likely growth won’t be quite as robust during the next few years, although per capita consumption could reach 55 gallons by 2025. 

First in the Minds, Hearts and Wallets of Consumers A November 2017 Harris Poll online survey for the International Bottled Water Association (IBWA) found 63% of Americans said bottled water was their preferred beverage, compared to coffee, 62%, and soft drinks, 58%. According to the poll, 94% of Americans considered bottled water a healthier beverage than soft drinks and 82% admitted they should be drinking more water. Plus, 53.1% of bottled water drinkers recycle their bottles compared to 20.4% of soda drinkers. Bottled water drinkers rated taste and quality almost universally, or 99%, as the most important factors when choosing a beverage. Important bottled-water features were ready to enjoy, 82%; very mobile packaging, 80%; and re-sealable packaging, 74%.

Still-Water Category Remains Industry Leader For the 52 weeks ending May 14, 2017, the total bottled water category had generated $15.2 billion in dollar sales at US multi- outlets and convenient stores. Convenience/PET still bottled water accounted for $11.5 billion of the total. In the jug/bulk still bottled water sub- category, total dollar sales during the same 52-week period was $1.46 billion, a 5.1% increase from the same 2016 period. Private label accounted for 43.9% of the market, more than three times #2 Poland Spring. As per previous years, private-label still water remained at the top of the category, with almost 250% more revenues than its next closest challenger, Dasani. The first 7 brands maintained their positions, but Fiji replaced Deer Park in the #8 position.

Sparkling Water Drives Overall Growth Driving much of the growth of the entire bottled water category is definitely sparkling water, having achieved almost a 40% increase by volume during the first half of 2017 and a 16% increase in dollar sales for the 52 weeks ending May 14, 2017. Michael Bellas, chairman and CEO of Beverage Marketing Corporation, predicts sparkling water dollar sales will continue to increase by double-digits for a number of quarters. Private label brands and Sparkling ICE maintained their #1 and #2 positions in the seltzer/sparkling/mineral water sub- category for the 52 weeks ending August 13, 2017, however, LaCroix moved into the #3 position, supplanting Perrier, which moved to #4.

New Products and Controversies A new trend is so-called “raw water,” which is water removed from a spring and bottled without any purification. Many health experts say this is dangerous. In addition, it’s expensive, as one product, Live Water, costs $12 to $16 for a 2.5-gallon jug. Another issue is the controversy surrounding Orb Media’s report of microplastic particles in bottled water; however, IBWA and others state the findings are not based on objective scientific research and bottled water remains safe to drink. In response to consumers’ demand for a healthier alternative to sodas, during February 2018, PepsiCo launched Drinkfinity, a new product line, consisting of a 20-ounce reusable water bottle with 12 different flavored pods.

Advertising Strategies To promote the healthy choice of bottled water, especially during the summer, offer a discount for a 24-bottle package with a qualifying grocery or convenience store purchase. Consider a quarterly weekend promotion to encourage customers to recycle bottled water containers by offering a discount and/or coupon for other merchandise based on the number of containers they bring to the store. Arrange with local youth and adult athletic leagues to provide them with supplies of bottled water for an occasional game in exchange for displaying signage during the game promoting your store and/or distributing coupons to all participants and audience members.

New Media Strategies Bottled water retailers can create and promote a consumer survey on their social media pages similar to the Harris Poll on page 1 of the Profilers to highlight the popularity of bottled water, by demographics and brands, in their communities. Post curated articles/blog posts, and even videos, if available, from health and/or hydration experts on the importance of remaining hydrated. Include information aimed specifically at seniors and those with certain medical conditions who should drink water daily. On Instagram and/or Snapchat, ask teens and young adults to post short videos explaining how they were able to wean themselves from drinking too many sugary beverages and exchanging them for bottled water.