The British can just turn on the tap if they want water. But that has done little to dampen the growth of the bottled water industry and manufacturers are now crying out for more shelf space to make the most of consumers’ thirst.
By 2011, according to a forecast by consultancy Zenith International, global sales of bottled water will have overtaken those of carbonates.
In take-home, flavoured water leads the way, says TNS, although still water accounts for the majority of overall sales, according to ACNielsen data. The UK mineral market rose 5.6% to £282m in the year to January 1, 2006 [TNS], with still water up 18.1% to more than £105m as more people bought more frequently.
Brands in particular are doing well, says ACNielsen, with the top five selling brands in the UK all in growth. Only carbonates are failing to appeal, dropping 18.3% in value to £38.7m, says TNS, thanks to a decline in price and a loss of buyers.
The predicted hot summer is also likely to add to water sales. Nestlé Waters, which this month unveiled new-look bottles for both its Buxton and Vittel brands, says sales of bottled water benefit from good weather more than those of other soft drinks.
Once the temperature passes 24C, sales rise 70% compared with a soft drinks uplift of 40%. Yet despite such growth in bottled water, suppliers say retailers aren’t giving them proportionate shelf space.
Highland Spring says there are more than 100
water companies operating in the UK, yet a typical supermarket stocks some ten brands.
Aoife Burnell, marketing director at Nestlé Waters, says retailers’ shelves need to expand to cope with the number of new players.
“There is, unfortunately, no room for new brands on the shelves,” she says.
Paul Martin, MD at Harrogate Spa, has a similar complaint. “Water sales are almost outstripping the space it has. Retailers should be giving more space to water brands and selling larger units to generate more water sales from the same space in the fixture,” he says.
Tests by Danone support this. It found that independents that increased the space for water by a fifth increased overall soft drink sales by 8%.
However, Martin accepts that retailers don’t have elastic walls and says it is up to brands to fight for space.
Growth in demand is, however, facing negative publicity because of green concerns. A recent report from the Earth Policy Institute in America flagged up
the huge impact that bottling and shipping water around the globe is having on the environment.
Ripples are being felt in the UK, where the top two water brands, Vittel and Evian, are French.
In 2004, Coca-Cola Enterprises withdrew its application to extend production of its Malvern brand in the UK after concerns about the potential impact on the environment.
To encourage the cutting of water miles, British Bottled Water Producers was formed in January. Jo Jacobius, BBWP director, says the association will inform consumers about buying British. “By buying water that hasn’t travelled halfway around the world, you are helping the planet,” she says.
To minimise the environmental impact of bottled water, ethical water brand One was established last October with profits used to build ‘roundabout’ pumps, which pump water from the energy created by children playing on them, in South Africa.
As One is taken up by retailers, Duncan Goose, company managing director, says that retailers are realising the importance of an ethical stance.
Debbie Roberts, assistant soft drinks buyer at Morrisons, believes consumers are developing a conscience.
“Our shoppers are really showing an interest in One due to its ethical stance. With warm summer months on the horizon, we can only expect to see it grow.”
<<p28 The Saturday Essay: One