Bottled Water - UK - June 2005

INTRODUCTION AND ABBREVIATIONS
Definitions
Consumer research
ACORN
Advertising data
 ABBREVIATIONS
PREMIER INSIGHT
Re-hydrating the aging population
Keeping it cool
A lifestyle choice
Promoting health associations
Catching up with European consumption habits
EXECUTIVE SUMMARY
Concern over health and well-being boosts sales
Convenience counts
Portability driving growth in the UK
Volume sales outpace value
New segments create opportunities
Danone dominates, while Highland Spring sparkles
Adding value
Top players benefit from adspend investment
Penetration peaks among 15-24-year-olds
In pursuit of a healthier lifestyle
Volume surging ahead of value
MARKET DRIVERS
Segmentation tailored for specific demographics
Figure 1: UK population, by age group, 2000-09
Rising disposable income boosts bottled water
Figure 2: Trends and projections in PDI and consumer expenditure, at current and constant 2000 prices, 2000-09
Weather exerts positive and negative effect
Figure 3: Average summer temperature and sunshine hours, 1992-2003
Availability
Children and merchandising
Why bottled in preference to tap?
As an alternative to alcohol
The slimming and dieting issue
Figure 4: Adults who are trying to slim, 2000-04
Figure 5: Frequency of dieting, 2004
Children worry too
Figure 6: Agreement with statements about eating, 11-14s, 2001-04
Could drinking water become cool?
Drinking to be healthy
Government White Paper on Health – November 2004
MARKET SIZE AND TRENDS
Total soft drinks – ‘healthier’ drinks take growing share
Figure 7: UK retail sales of soft drinks, by value and volume, 2000-04
Volumes surge ahead of values
Figure 8: UK retail sales of bottled water, by volume and average price, 2000-05
Figure 9: UK retail value sales of bottled water, 2000-05
MARKET SEGMENTATION
Premiumisation favours natural mineral water
Figure 10: UK retail volume sales of bottled water, by type of source, 2001-05
Flavour also adds value
Are consumers more becoming more discerning?
Kids carve a niche, with room for growth
Functional and enriched
Still takes the fizz out of sparkling
Figure 11: UK retail volume sales of bottled water, by carbonation, 2001-05
Figure 12: UK retail value sales of bottled water, by carbonation, 2001-05
PET has driven growth
Figure 13: Bottled water volumes, by packaging type, 2000-05
THE SUPPLY STRUCTURE
The big grow even bigger
Figure 14: Brand shares in the bottled water off-trade, by volume*, 2003-05
Own-label share declines despite volume sales increase
San Pellegrino achieves enviable premium status
 COMPANIES AND BRANDS
Britvic Soft Drinks
Coca-Cola Schweppes
Crystal Drinks
Danone Waters
Greencore
Highland Spring
Matthew Clark Brands
Nestlé Waters
Princes
Ty Nant
Own-label
NEW PRODUCT DEVELOPMENT
Introduction
Functional
Enriched
Flavoured
Products for children
Purification and hydration
Ethical proposition
Packaging
Future trends
 NEW PRODUCT BRIEFS
April 2005
March 2005
February 2005
January 2005
October 2004
September 2004
August 2004
July 2004
June 2004
May 2004
ADVERTISING AND PROMOTION
Adspend stays strong
Figure 15: Main monitored media advertising expenditure on bottled water, 2000-04
Figure 16: Main monitored media advertising expenditure on bottled water, by manufacturer and brand, 2002-04
Danone
Volvic – full of ‘volcanicity’
Detox with Evian
Nestlé
Buxton – anyone for Tennis?
Vittel – promoting revitalisation
Highland Spring
The Natural Mineral Water Information Service
 BELOW-THE-LINE PROMOTION
Figure 17: Below-the-line promotions in the last 6 months, October 2004-May 2005
Figure 18: Below-the-line promotions in the last 6 months, own-label vs brand, October 2004-May 2005
Figure 19: Below-the-line promotions in the last 6 months, by manufacturer, October 2004-May 2005
Figure 20: Below-the-line promotional activity, November 2004-May 2005
DISTRIBUTION
Strong off-trade performance
Figure 21: UK retail sales of bottled water, by outlet type, 2001-05
Grocery multiples driving growth
Figure 22: UK retail volume sales of bottled water, by outlet, 2001-05
Stock replenishment is a major challenge
Opportunities in leisure and catering outlets
THE CONSUMER
Rising penetration and frequency of use
Figure 23: Usage of bottled mineral water, 2000-04
Still water the preferred type
Figure 24: Types of bottled mineral water used, 2004
Flavoured water, herbal and premium soft drinks
Figure 25: Usage of flavoured, herbal and premium soft drinks, 2000-04
Assessing consumer target groups
Figure 26: Health related consumer typologies, Winter 2004
Slobs (32% of the sample)
Dieters (28% of the sample)
Sensible Eaters (20% of the sample)
Health Addicts (20%)
Key responses among consumer typologies
Figure 27: Cluster groups by agreement with the lifestyle statements, 2004
Figure 28: Cluster groups by usage of bottled mineral water, 2004
Figure 29: Cluster groups by usage of flavoured water, herbal and premium soft drinks, 2004
Target group potential
Dieters
Health Addicts
Sensible Eaters
Slobs
Purchasing habits
Figure 30: Types of bottled water purchased in the last three months, April 2005
Still water is the most widely purchased type
Is tap water just as good?
Flavoured water appeals more to women
Sparkling water appeals most to the middle-aged middle classes
Are we patriotic purchasers of water?
Continental brands appeal to lifestyle conscious
Limited appeal of own-label
Convenience attracts younger consumers
A healthy addition to the lunchbox
Functional waters have yet to catch on
THE CONSUMER – DETAILED DEMOGRAPHICS
Figure 31: Bottled water consumer typologies, bygender, age, socio-economic group, presence of children, marital status, working status, region and lifestage, 2004
Figure 33: Top five types of bottled water purchased in the last 3 months, by gender, age, socio-economic group, Mintel's Special Groups, region, marital status, working status, presence of children and household size, April 2005
Figure 34: Top five types of bottled water purchased in the last 3 months, by ACORN categories, media usage, commercial TV viewing, Internet and supermarket usage, February 2005
Figure 35: Further popular types of bottled water purchased in the last 3 months, by gender, age, socio-economic group, Mintel's Special Groups, region, marital status, working status, presence of children and household size, April 2005
Figure 36: Further popular types of bottled water purchased in the last 3 months, by ACORN categories, media usage, commercial TV viewing, Internet and supermarket usage, February 2005
THE CONSUMER – ATTITUDES AND MOTIVATIONS
Figure 37: Attitudes to bottled water, April 2005
Busy drinkers
Refusers
Bulk buyers
Discerning drinkers
Home purifiers
Let them drink water
Refillers
Fans of flavoured
Bottled is ‘better for you’
Some brands taste better
Buy when the price is right
Cross analysis results
Figure 38: Cross-analysis of types of bottled water purchased and attitudes, April 2005
 ASSESSING ENTHUSIASM
Figure 39: Number of types of bottled water bought in the last three months, April 2005
Figure 40: Number of types of bottled water bought in the last three months, April 2005
THE CONSUMER – ATTITUDES AND MOTIVATIONS: DETAILED DEMOGRAPHICS
Figure 41: Attitudes towards bottled water, by gender, age, socio-economic group, Mintel's Special Groups, region, working status, presence of children and household size, April 2005
Figure 42: types of bottled water purchased in the last 3 months, by ACORN categories, media usage, commercial TV viewing and supermarket usage, February 2005
Figure 43: Other attitudes towards bottled water, bygender, age, socio-economic group, Mintel's Special Groups, region, presence of children and household size, April 2005
Figure 44: Other attitudes towards bottled water, by ACORN categories, media usage, Internet usage, commercial TV viewing and supermarket usage, February 2005
Figure 45: Further attitudes towards bottled water, by gender, age, socio-economic group, Mintel's Special Groups, region, presence of children and household size, April 2005
Figure 46: Further attitudes towards bottled water, by ACORN categories, media usage, commercial TV viewing and supermarket usage, February 2005
THE FUTURE
Potential to grow per capita consumption
Health will continue to be driving factor
A clear identity needed
Natural or functional?
An alternative to soft drinks
Increased consumption
FORECAST
Figure 47: Forecast of the UK bottled water market, by value, 2005-10
Health concerns to sustain future growth
Average price to drop further
Figure 48: Forecast of the UK bottled water market, by volume, 2005-10
Figure 49: Indexed growth rates of the bottled water market in the UK, 2005-10
Innovation will help the market in future
Factors used in the forecast