Table of Contents
Introduction
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- Definition
- Abbreviations
Executive Summary
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- The market
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- Figure 1: Market size and forecast for value sales of bottled water, 2005-15
- Market factors
- Companies, brands and innovation
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- Figure 2: Market share for value sales of bottled water brands in the take-home market, 2010
- The consumer
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- Figure 3: Attitudes among UK consumers towards bottled water versus tap water, March 2011
- What we think
Issues in the Market
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- Will the bottled water market ever reach the heights achieved five years ago?
- To what extent are consumers switching to tap water and how can this be prevented?
- What drives people to buy one bottled water brand over another?
- What occasions should bottled water companies target?
Future Opportunities
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- Transumers
- Purity
Internal Market Environment
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- Key points
- Bottled water lowers its price point to ensure a better value proposition...
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- Figure 4: Changing prices of soft drinks compared to bottled water, 2007-10
- …and despite negative predictions, proves a robust market
- People continue to lead healthier lifestyles
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- Figure 5: The most pressing personal concerns among the UK population, February 2011
- Convenience remains as crucial as ever
- The UK climate becomes hotter
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- Figure 6: Proportion of bottled water consumed in UK as a share of other selected European countries, 2009
- Figure 7: Annual sunshine hours 2003-10, compared to the 1971-2000 average
- A growing demand for ‘British’ brands
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- Figure 8: Trends in consumers’ preference for buying goods produced in their own country, 2006-10
- Environmental/ethical concerns recede
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- Figure 9: Trends in agreement with selected lifestyle statements, 2006-10
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- Figure 10: Consumer attitudes towards packaging and recycling, July 2009
Broader Market Environment
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- Key points
- Bottled water is at the mercy of the macroeconomic context…
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- Figure 11: A comparison of sales of bottled water and consumer expenditure, 2006-10
- …and inflation is putting the squeeze on UK consumers in 2011
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- Figure 12: RPI and average weekly earnings, January 2005-February 2011
- However, things should slowly improve from 2012
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- Figure 13: Consumer expenditure and its forecast growth, at constant 2010 prices, 2007-15
- Rise in ABC1s fuels trends for premiumisation and convenience
- The importance of connecting with the sceptical older generation
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- Figure 14: Growth of the bottled water market compared to the ageing of the over-55 population, 1950-2010
Competitive Context
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- Key points
- Soft drinks market sees steady growth as alcohol consumption wanes
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- Figure 15: Volume of soft drinks consumption, 2000-10
- Increased competition within the soft drinks market
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- Figure 16: Trends in usage of soft drinks, 2006-10
- Economic downturn changes market dynamics…
- …and leads to a correction in price points
Strengths and Weaknesses in the Market
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- Strengths
- Weaknesses
Who’s Innovating?
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- Key points
- Bottled water aims to dispel its environmentally unfriendly image
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- Figure 17: New product development in the bottled water market, by claims, 2008-10
- A continued drive towards flavoured water
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- Figure 18: New product development in the bottled water market, by sub-category, 2008-10
- Where flavoured water might end up
- Enhancing unflavoured water
- An on-the-go format that allows consumers to add flavour
Market Size, Forecast and Segmentation
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- Key points
- Bottled water sales remain steady after dramatic decline...
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- Figure 19: Value sales of bottled water, at current and constant 2005 prices, 2005-15
- …but price sensitivities will cut into profits
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- Figure 20: Market size and forecast for value sales of bottled water, 2005-15
- Volume sales will start to reverse from 2011
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- Figure 21: Volume sales of bottled water, 2005-15
- Enhanced water has grown its share – but only very incrementally
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- Figure 22: Value sales of bottled water in the take-home channel, by water type, 2006-10
- Forecast methodology
Market Share
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- Key points
- Danone remains dominant despite declining sales
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- Figure 23: Brand market share of the take-home bottled water market, by value, 2008-10
- The rise of mainstream British brands
- Value brands flourish
Companies and Products
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- Key points
- Britvic Soft Drinks
- Coca-Cola
- Danone
- Highland Spring
- Nestlé Waters
Brand Research
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- Brand map
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- Figure 24: Attitudes towards and usage of water brands, March 2011
- Brand attitudes
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- Figure 25: Attitudes, by water brand, March 2011
- Brand personality
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- Figure 26: Water brand personality – macro image, March 2011
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- Figure 27: Water brand personality – micro image, March 2011
- Correspondence analysis
- Brand experience
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- Figure 28: Water brand usage, March 2011
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- Figure 29: Satisfaction with various water brands, March 2011
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- Figure 30: Consideration of water brands, March 2011
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- Figure 31: Consumer perceptions of current water brand performance, March 2011
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- Figure 32: Water brand recommendation – Net Promoter Score, March 2011
- Brand index
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- Figure 33: Water brand index, March 2011
- Figure 34: Water brand index vs. recommendation, March 2011
- Target group analysis
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- Figure 35: Target groups, March 2011
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- Figure 36: Water brand usage, by target groups, March 2011
- Group One – The Conformists
- Group Two – Simply the Best
- Group Three – Shelf Stalkers
- Group Four – Habitual Shoppers
- Group Five – The Individualists
Brand Communication and Promotion
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- Key points
- Discounting activity comes at the expense of above-the-line expenditure
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- Figure 37: Main monitored media advertising spend on bottled water (in £millions), 2006-10
- Danone still the biggest brand builder
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- Figure 38: Share of above-the-line advertising spend, by advertisers, 2008-10
- Figure 39: Above-the-line advertising spend, by brands, 2008-10
Channels to Market
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- Key points
- Take-home takes an increasing share of the profits
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- Figure 40: Volume and value sales of the UK bottled water market, by channel, 2006-10
- Supermarkets benefit from consumer caution
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- Figure 41: Value sales and share of bottled water, multiples versus impulse sector, 2008-10
- The on-trade is the next big opportunity
Consumer Usage of Bottled Water
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- Key points
- Bottled water’s pool of users continues to shrink
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- Figure 42: Trends in usage and frequency of drinking bottled mineral water, 2006-10
- Usage is dominated by ABC1 younger women…
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- Figure 43: Bottled mineral water drinkers, by gender, age and socio-economic group, 2010
- …but frequency of consumption is greatest among C2DEs…
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- Figure 44: Bottled water consumption occasions per month, by gender, age and socio-economic group,, 2010
- …due to being more likely to drink bottled water at home
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- Figure 45: Those who consumed bottled water at home in the past 6 months, by socio-economic group, March 2011
- Bottled water is primarily drunk on the go…
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- Figure 46: Occasions where people purchase bottled water to drink, March 2011
- …but in-home/work drinking is much more frequent
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- Figure 47: Frequency with which people drink bottled water, by selected occasion, July 2010
- Younger people especially likely to drink bottled water when out and about
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- Figure 48: Net difference between occasions when under-45s drink bottled water compared to over-45s, March 2011
- The convenience of portability drives preference for small formats
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- Figure 49: Volume of bottled mineral water drunk most often, 2010*
- Does portability apply equally to the home?
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- Figure 50: Key statements on which bottled water drinkers at home differ from overall bottled water drinkers, March 2011
- Sparkling remains a niche sector
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- Figure 51: Trends in types of bottled mineral water drunk most often, 2006-10
Consumer Attitudes – Bottled Water Versus Tap Water
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- Key points
- Convenience is bottled water’s major USP versus tap water…
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- Figure 52: Attitudes among UK consumers towards bottled water versus tap water, March 2011
- …but half the UK population also think it is purer
- Younger people are particularly sold on bottled water’s health benefits
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- Figure 53: Net difference in attitudes towards bottled water compared to tap water, under-45s versus over-45s, March 2011
- C2DEs less concerned about bottled water’s environmental impact
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- Figure 54: Attitudes towards bottled water versus tap water, ABC1 versus C2DE adults, March 2011
General Consumer Attitudes towards Bottled Water
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- Key points
- Established rather than niche boutique brands are the most trusted
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- Figure 55: General attitudes towards bottled water, March 2011
- An especially opportune time to be big and British
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- Figure 56: Net difference in general attitudes towards bottled water, under-45s compared to over-45s, March 2011
- Bottled water remains a compelling proposition in spite of the downturn…
- …due to its convenience...
- …combined with its hydration benefits...
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- Figure 57: Perceived health benefits of bottled water, March 2011
- …and the benefits of its perceived purity
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- Figure 58: Net difference between perceived health benefits of bottled water, by gender, March 2011
- Eco credentials plus style tap into younger drinkers’ self-consciousness
- Reasons why own-label is buoyant
- Fill-ups are hindering frequency of sales
- There is untapped potential for vitamin-infused water among young men
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- Figure 59: Index of agreement with statements about flavoured/vitamin water, by gender, age and socio-economic group, March 2011
Appendix – Broader Market Environment
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- Figure 60: GDP, PDI, consumer expenditure and savings, at current prices, 2005-15
- Figure 61: GDP, PDI, consumer expenditure and savings, at constant 2010 prices, 2005-15
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- Figure 62: GfK NOP Consumer monthly consumer confidence index, January 2007-February 2011
- Figure 63: Forecast adult population trends, by socio-economic group, 2005-15
- Figure 64: Trends in the age structure of the UK population, 2005-15
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Appendix – Brand Research
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- Figure 65: Brand usage, March 2011
- Figure 66: Brand commitment, March 2011
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- Figure 67: Brand momentum, March 2011
- Figure 68: Brand diversity, March 2011
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- Figure 69: Brand satisfaction, March 2011
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- Figure 71: Brand attitude, March 2011
- Figure 72: Brand image - Macro image, March 2011
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- Figure 73: Brand image - Micro image, March 2011
- Figure 74: Profile of target groups, by demographics, March 2011
- Figure 75: Psychographic segmentation by Target groups, March 2011
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- Figure 76: Brand usage by Target groups, March 2011
- Figure 77: Brand index, March 2011
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Appendix – Brand Communication and Promotion
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- Figure 78: Above-the-line advertising spend, by advertisers, 2008-10
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Appendix – Consumer Usage
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- Figure 79: Frequency of drinking bottled mineral water, by demographics, 2010
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- Figure 80: Places where bottled water is consumed, by demographics, March 2011
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Appendix – Consumer Attitudes – Bottled Water Versus Tap Water
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- Figure 81: Agreement with the statement 'Drinking bottled water is more convenient than tap water ie when out and about’, by demographics, March 2011
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- Figure 82: Agreement with the statement 'Drinking bottled water instead of tap water is an unnecessary indulgence’, by demographics, March 2011
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- Figure 83: Agreement with the statement 'Drinking bottled water instead of tap water is bad for the environment’, by demographics, March 2011
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- Figure 84: Agreement with the statement 'Bottled water has fewer impurities than tap water’, by demographics, March 2011
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- Figure 85: Agreement with the statement 'I prefer the taste of bottled water to tap water’, by demographics, March 2011
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- Figure 86: Agreement with the statement 'Bottled water is better for you than tap water’, by demographics, March 2011
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- Figure 87: Agreement with the statement 'Drinking bottled water instead of tap water makes me feel like I’m treating myself’, by demographics, March 2011
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- Figure 88: Agreement with the statement 'I would rather be seen drinking bottled water than tap water’, by demographics, March 2011
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Appendix – General Consumer Attitudes towards Bottled Water
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- Figure 89: Most popular perceived health benefits of bottled water, by demographics, March 2011
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- Figure 90: Next most popular perceived health benefits of bottled water, by demographics, March 2011
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- Figure 91: Agreement with the statement 'To save money I fill up my bottle with tap water when possible', by demographics, March 2011
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- Figure 92: Agreement with the statement 'I prefer to buy British bottled water brands (eg Highland Spring, Buxton etc) where possible', by demographics, March 2011
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- Figure 93: Agreement with the statement 'The convenience of drinking bottled water on the go makes it worth the money', by demographics, March 2011
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- Figure 94: Agreement with the statement 'I trust the water quality of established brands (eg Evian, Buxton) more than less well-known brands', by demographics, March 2011
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- Figure 95: Agreement with the statement 'Flavoured water is less bad for your health/teeth than the majority of soft drinks', by demographics, March 2011
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- Figure 96: Agreement with the statement 'I believe that drinking water with vitamins in it gives you some health benefits', by demographics, March 2011
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- Figure 97: Agreement with the statement 'If I did not drink bottled water, I would not drink enough water', by demographics, March 2011
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- Figure 98: Agreement with the statement 'Buying more ethical/environmentally friendly bottled water brands makes me feel better about myself', by demographics, March 2011
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- Figure 99: Agreement with the statement 'I am put off flavoured water by its calorie content', by demographics, March 2011
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- Figure 100: Agreement with the statement 'With bottled water brands, you get what you pay for', by demographics, March 2011
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- Figure 101: Agreement with the statement 'I am attracted to bottled water brands with stylish packaging', by demographics, March 2011
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- Figure 102: Agreement with the statement 'I like stylish bottled water brands that not everyone drinks eg Acqua Panna, Isklar', by demographics, March 2011
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