Table of Contents
Overview
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- What you need to know
- Products covered in this Report
Executive Summary
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- The market
- Health concerns and low prices drive sales growth 2011-16
- Soft drinks levy and economy to determine sales 2016-21
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- Figure 1: Forecast of UK sales of bottled water, by value, 2011-21
- Unflavoured waters gain most from consumer sugar concerns
- Greater volatility in on-premise sales
- Soft drinks levy could strengthen category
- Companies and brands
- Volvic remains market leader but volume sales fall
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- Figure 2: Leading brands’ shares in the UK retail bottled water market, by value, 2015/16*
- L/N/R sugar claims for flavoured water rise in 2016
- Category blurring continues into 2016
- Advertising spend rises in 2016
- Evian is the most trusted brand, while Glacéau is the most likely to be seen as different
- The consumer
- Overall usage unchanged, but flavoured sparkling usage frequency rises
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- Figure 3: Usage frequency for bottled water, by type, December 2016
- Future direction of the economy significant for bottled water sales
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- Figure 4: Bottled water drinking and buying behaviours, December 2016
- Only a minority see bottled water as bad for the environment, but backlash risks are high
- Emphasising environmental credentials is a promising means to appeal
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- Figure 5: Attitudes towards bottled water, December 2016
- What we think
Issues and Insights
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- Strong consumer interest in the environment provides opportunities for those best able to trade on positive credentials
- The facts
- The implications
- Make-your-own flavoured water kits would cater to consumer desire for customisation
- The facts
- The implications
- Parents’ strong tendency to buy bottled water provides scope for expansion in children’s products
- The facts
- The implications
The Market – What You Need to Know
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- Health concerns and low prices drive sales growth over 2011-16
- Soft drinks levy and economy to determine sales 2016-21
- Unflavoured waters gain most from consumer sugar concerns
- Greater volatility in on-premise sales
- Soft drinks levy could strengthen category
Market Size and Forecast
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- Bottled water volumes benefit from low prices and sugar controversy over 2011-16
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- Figure 6: UK value and volume sales of bottled water, 2011-21
- Forecast
- Soft drinks levy likely to drive up volume sales over 2016-21
- State of the economy could have conflicting effects
- Demographic changes provide a boost and a challenge
- Effects of exchange rates to be limited, but overall inflation to push up values over 2016-21
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- Figure 7: Forecast of UK sales of bottled water, by value, 2011-21
- Figure 8: Forecast of UK sales of bottled water, by volume, 2011-21
- Forecast methodology
Market Segmentation
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- Unflavoured waters benefit particularly from heightened sugar concerns
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- Figure 9: Retail value and volume sales of bottled water, by segment, 2014-16
- Fortified water benefits from increased availability and health trends
- Greater volatility in on-premise sales
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- Figure 10: Value and volume sales of bottled water, by retail and on-premise channels, 2011-16
Market Drivers
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- State of the economy is key to future sales
- Pound’s depreciation could lead to inflation for imported waters
- Health concerns over sugar continue
- Soft drinks tax could give a boost to unflavoured water
- Some flavoured variants could lose out
- Government advises parents to limit their children’s intake of sugary drinks
- Changing population dynamics provide a challenge and an opportunity
Companies and Brands – What You Need to Know
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- Volvic remains market leader but volume sales fall
- L/N/R sugar claims for flavoured water rise in 2016
- Category blurring continues into 2016
- Advertising spend rises in 2016
- Evian is the most trusted brand, while Glacéau is the most likely to be seen as different
Market Share
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- Mixed results for Danone’s brands
- Increased advertising and range extensions helps Glacéau to grow
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- Figure 11: Leading brands’ sales and share in the UK bottled water retail market, by value and volume, 2013/14-2015/16
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- Figure 12: Leading manufacturers’ sales and share in the UK bottled water retail market, by value and volume, 2013/14-2015/16
Launch Activity and Innovation
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- Environmentally friendly packaging remains the top claim, but little real innovation
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- Figure 13: New product launches in the UK bottled water market, by top 20 claims (sorted by 2016), 2012-16
- L/N/R sugar claims rise for flavoured water
- CCE targets parents’ health concerns with Capri-Sun Fruity Water
- Artificial sweeteners the primary sugar substitute, but some use of alternatives
- Category blurring continues into 2016
- Between flavoured waters and juice drinks…
- …and coloured sparkling flavoured waters, offering competition to CSDs
- Cucumber waters appear from smaller brands looking to appeal to desire for less sweet tastes
Advertising and Marketing Activity
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- Advertising spend rises in 2016
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- Figure 14: Total above-the line, online display and direct mail advertising expenditure on bottled water, by top advertisers (sorted by 2016), 2012-16
- CCE overtakes Danone as largest advertiser
- Pushing a message of simplicity and purity with seasonal summaries
- Beacon campaign pushes out-of-home recommendations
- Promoting associations with Christmas to encourage winter drinking
- Danone takes multiple approaches to promoting Volvic in 2016
- Sports-led focus for Volvic’s plain variants
- Flavoured variants portrayed as a way for people to express their individuality
- Volvic Juiced shown as a mood-booster
- Volvic draws on volcanic origins to promote inner strength
- Evian continues its ‘Live Young’ campaign
- AG Barr supports Rubicon Spring launch
- Nielsen Ad Intel coverage
Brand Research
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- What you need to know
- Brand map
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- Figure 15: Attitudes towards and usage of selected brands, January 2017
- Key brand metrics
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- Figure 16: Key metrics for selected brands, January 2017
- Brand attitudes: Evian is the most trusted brand
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- Figure 17: Attitudes, by brand, January 2017
- Brand personality: Volvic is seen as the most fun
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- Figure 18: Brand personality – Macro image, January 2017
- Brand personality: Glacéau is seen as stylish and sophisticated
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- Figure 19: Brand personality – Micro image, January 2017
- Brand analysis
- Glacéau Smartwater stands out from other brands
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- Figure 20: User profile of Glacéau Smartwater, January 2017
- Volvic scores highest for taste but fails to stand out
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- Figure 21: User profile of Volvic, January 2017
- Evian is the brand most seen as worth paying more for
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- Figure 22: User profile of Evian, January 2017
- Highland Spring enjoys favour among people in Scotland
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- Figure 23: User profile of Highland Spring, January 2017
- Buxton could do more to showcase its support for the environment
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- Figure 24: User profile of Buxton, January 2017
The Consumer – What You Need to Know
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- Overall usage unchanged, but flavoured sparkling usage frequency rises
- Future direction of the economy influential for bottled water sales
- Only a minority see bottled water as bad for the environment, but backlash risks are high
- Emphasising environmental credentials is a promising means to appeal
Usage of Bottled Water
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- 71% drink bottled water, with sugar focus boosting sparkling variants
- Only a minority drink bottled water daily
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- Figure 25: Usage frequency for bottled water, by type, December 2016
- Ageing population could limit volume sales growth
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- Figure 26: Usage of bottled water (any type), by age, December 2016
- Filtered water a potential rival
- Environmental concerns help to drive water filter usage
Bottled Water Buying Occasions
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- Out-of-home occasions dominate, but over half buy to drink at home
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- Figure 27: Bottled water buying occasions, December 2016
- Designer packaging could encourage special occasion usage
- Opportunities for expansion in lunchbox formats
Bottled Water Drinking and Buying Behaviours
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- Sugar concerns prompt switching
- L/N/R sugar flavoured waters will need to strongly emphasise this attribute
- Consumer suspicions of artificial sweeteners present a barrier to reformulation
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- Figure 28: Bottled water drinking and buying behaviours, December 2016
- The future direction of the economy is pivotal for bottled water sales
- Flavoured water especially vulnerable to spending cutbacks
- Make-your-own flavoured water kits would cater to consumers’ desire for customisation
Attitudes towards Bottled Water
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- Bottled water is seen as bad for the environment by a significant minority
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- Figure 29: Attitudes towards bottled water, December 2016
- Strong consumer interest in environmentally friendly options
- Recycled plastic bottles have strong appeal
- Demonstrating environmental commitments should provide a boost
- Need to make environmental policies more prominent
- Funding conservation projects would allow companies to demonstrate their commitment to the environment
- Need to make charity links more tangible
Qualities Associated with Flavoured Water vs Juice Drinks
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- Flavoured water is associated with positive attributes such as hydration and refreshment
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- Figure 30: Qualities associated with flavoured water vs juice drinks, December 2016
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
Appendix – Market Size and Forecast
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- Figure 31: Forecast of UK sales of bottled water, by value, best- and worst-case, 2016-21
- Figure 32: Forecast of UK sales of bottled water, by volume, best- and worst-case, 2016-21
- Forecast methodology
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