Is the market in terminal decline as consumers opt for tap water?
There is a close relationship between consumer confidence and bottled water penetration and sales. Both fell dramatically in 2007 but have shown signs of recovery in 2009. It is likely that economic caution led consumers to switch to tap water.
Volume sales of bottled water declined by 11% between 2006 and 2008. However, the decline has slowed to 1% in 2009. This means the market is now selling 2.3 bn litres of water at a value of £1.9bn, with both volume and value sales forecast to grow steadily from 2011 onwards.
There is a close relationship between consumer confidence and bottled water penetration and sales. Both fell dramatically in 2007 but have shown signs of recovery in 2009. It is likely that economic caution led consumers to switch to tap water.
Volume sales of bottled water declined by 11% between 2006 and 2008. However, the decline has slowed to 1% in 2009. This means the market is now selling 2.3 bn litres of water at a value of £1.9bn, with both volume and value sales forecast to grow steadily from 2011 onwards.
Even bottled water drinkers are sceptical about its value. Only 2.1m of the UK online population think of it as value for money compared to 8.1m who think it is a “bit of a con”.
However, consumers also see a number of benefits in bottled water. There are 5.3m online users who think that without buying bottled they would not drink enough water. And 4.5m that it is healthier for them because it stops them drinking sugary soft drinks and caffeine.
The bottled water market is currently more price- than brand-led with 11.9m online bottled water drinkers motivated to buy whichever brand is cheapest. Only 5.2m are motivated to buy a brand they trust, but 7m drinkers are influenced by “an easy-to-carry” bottle.
Glacéau Vitamin Water (Coca-Cola) is a flavoured water drink fortified with vitamins such as B and C. It entered into the UK market in 2008 having grown its sales by over 450% in the US market between 2005 and 2008.
With rising prices and economic downturn at play between 2008 and 2009, the coffee market has managed to weather the storm well. Between 2005 and 2009 the UK market for in-home coffee achieved 17% growth in value, and although some of this is attributed to the hike in raw coffee and production costs, trading up has still been a key feature of this market.
There is a close relationship between consumer confidence and bottled water penetration and sales. Both fell dramatically in 2007 but have shown signs of recovery in 2009. It is likely that economic caution led consumers to switch to tap water.
