BottledWater CaseStudy

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@ The bottled water market is estimated at around Rs. 1,250 crores
@ The market is growing at around 25-30% a year and is expected to

continue to its momentum in future as well
@ The per capita consumption of packaged water in India is pitifully low

at less than 5 litres a year compared to the global average consumption
of 24 litres
@ The annual bottled water consumption in India had tripled to 5

billion liters in 2004 from 1.5 billion liters in 1999
@ Global consumption of bottled water around 200 billion liters in ¶06

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@ ver 1,200 bottling plants across India
£ An estimated 600 in Tamil Nadu alone!
@ There exists more than 150 brands of which nearly 90% are local
£ Making bottled water is a cottage industry in this country
@ Bulk of the growth of the Indian market attributed to two reasons:

£ Poor public water infrastructure
£ Increasing disposable income
@ Per capita consumption in India is less than 5 litres/year

@ The global average is around 24 litres
@ Indians are ranked tenth in bottled water consumption

Th
@ Despite the large number of small producers, this industry

is dominated by big players
£ Parle
£ Coca-Cola
£ PepsiCo
£ Parle Agro
£ Mohan Meakins
£ SKN Breweries
@ Parle, the first mover in the Indian market

@ When it introduced Bisleri in India 25 years ago

@

£ rvian, San Pellegrino and Perrier
£ Priced between Rs.80 and Rs.110 a litre
@

£ imalayan and Catch
£ Priced at Rs.20 a litre
@ T

£ Bisleri, Kinley, Aqua fina etc.,
£ Priced around Rs. 12 a litre
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£

@ Plans to hike advertising and promotional spend by 46%
in 2010 to meet rising competition
@ Rs 35 crore on ad and promotion of the regular Bisleri in

the current fiscal and Rs 12 crore on imalayan
@ Bisleri plans to put up 32 new plants over the next two

years and plans to invest Rs 10 crore in each of them
@ Grocers are among Aquafina·s key distribution points
@ Company launched 2 litre & 500 ml packs to suit various

consumer requirements
@ Recently revamped the Aqua fina 500 ml carry pack and

introduced a new enhanced translucent blue label giving
the brand a new look
@ It·s looking at building strong consumer engagement

across geographies through campaigns and trade promos
@ Kinley went for an all-new packaging recently
@ as plans to introduce its global brand ¶Bonaqua· in

India very soon
@ It is within the realm of possibility that Coca-Cola·s next

step will be to introduce flavoured water in India

@ Pouches, glasses and cups
@ 200 ml (popular in flights)
@ 330 ml bottles
@ 500 ml bottles ml (a huge hit among the youth)

@ 1 litre bottles ( otels and travel sector)
@ Large 2 litre bottles
@ Bulk water - grew at a rate of 30 - 40% in 2002 alone

£ 25 litre DPr can
£ 20 litre bubble top PrT

[
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@ SrC A, B & B+ income groups reflecting changing lifestyles and

consumption trends
@ Increasingly cool to be seen with bottled water
@ Fast-paced life is making them look for convenient, trustworthy and
hygienic beverage solutions
@ Increased health and wellness trends across the country, led by metros, is
making it mandatory to drink packaged water
@ Drinking mineral water used to be a fad but now a necessity
@ ome delivery of jars highlights need for pure water at home too
@ Consumers believe it is better to be safe than sorry!
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@ Consumption of bottled water in India is linked to the

level of prosperity in the different regions
£ The western region accounts for 40% of the market
£ The eastern region accounts for just 10%
£ Bottling plants are concentrated in the southern region
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@ PrT is growing in South

@ Accounts for 48 per cent of the total market
@ South India is the largest consumer of PrT material for

packaging mineral water
@ South India commands a market share of 48%
@ West India accounts for 28%
@ North and rast India, combined contributes to 24%

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@ The main consumers no longer restricted to the upper

class but include:
£ Middle class
£ And lower-middle class families as well
@ Driven to the category by lack of clean, hygienic water
@ The rural market

£ Dominated by tourists and travelers
£ Packaged water now an essential appendage to any form of travel
T!
@ 370 authorized supply units have sprung up across TN
@ The regional players:

£ perate plants replete with wells, bore wells
£ With modern reverse osmosis techniques, UV radiation units
@ About 220 water units operate near Chennai alone
@ Companies rake in Rs 80 lakh to Re. 1 crore daily!
@ Ratio of each player's market share to the entire packaged

water market is the same in both lean and peak seasons
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@ The water market is worth over Rs 1,250 crore

@ Water-starved Chennai alone accounts for a quarter of that pie!
@ 70 lakh litres of water are sold in the city everyday

@ 3 lakh litres by multinational water brands
@ 2 lakh litres are supplied by Parle¶s Bisleri
@ igh-income group & corporates tend to choose Kinley
@ Middle-income households prefer local suppliers
£ Bisleri, Apollo and Team are among the chosen ones
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@ 5 million quarter-liter packets @ Re. 1 each
@ 75,000 1-liter bottles @ Rs. 10 to Rs.12 each
@ 100,000 12-liter cans @ Rs. 18 to Rs. 30 each
@ 25,000 20-25 litre bubble-top containers from Rs. 38
@ 10,000 water tankers carrying 12,000 litres each @ Rs. 700

to Rs. 900 / tanker
Thch
@ Majority of city households depend on packaged water for
cooking and drinking purposes
@ The bubble top has become the mainstay in most homes

despite round-the-clock supply by Metro water
@ Daily sale of 20-litre bubble tops exceeds 75,000 units a day
@ MRP Rs. 15 - Rs. 35 per can
@ The residents are collectively spending more than Rs. 15 lakh

every day on potable water
@ Residents got used to packaged drinking water during the

successive drought years (a few years back) and there has been
no going back!
© "
@ Railways is a huge potential market
@ Water bottles, especially the 2 litre variety, are fast

movers among the train-travelling crowd
@ According to officials at Cherio, the railways order

10,000 cases (of 12 bottles each) a day
@ It accounts for 5% of Cherio·s water sales

Th ch #

@ Competitors compete globally, internationally, nationally,

regionally, and locally
@ All brands are pretty much identical

£ Though there are sub-segments in the bottled water industry viz.,
purified, mineral, sparkling, or enhanced waters
@ Large number of players and increasing competition have

been pushing the prices and margins down

@ Though most consumers are health-conscious and all that,

bottled water is a low-involvement category for them
@ They might ask for a ¶Bisleri· or ¶Water bottle· to the

retailer and take whatever is handed to them
£ As long as it looks and feels like a mineral water bottle!
£ Incidentally, to the consumer ¶Bisleri· means ¶Mineral Water·!
@ Brand loyalty is almost non-existent!

£ (r is it?)
h $
@ Though there has been sporadic advertising, most brands

seem to be disinterested to advertise
£ Given the low consumer involvement in the category
@ Very few consumers can even recall advertising of the

brands that have done so
£ Again, due to low category involvement
@ Some brands do resort to ground-level initiatives and

activities like sponsorships
£ Aqua fina and Kinley are cases in point
%h&h '
@ elp launch a bottled water brand for a small company

£ Small compared to the likes of PepsiCo, Coco-Cola, Parle etc.,
@ A company that can spend some money on promotion

but can·t match the budgets of the biggies in the category
@ The bottled water you are planning to launch would be

no different from the other brands in the market
£ As my good-looking science teacher in school used to say ¶water
is a colourless, tasteless and odourless liquid!·
©'
@ The facts given in the case are just indicative«
@ You are expected to do some level of research on your own«
@ Talk to consumers«
@ Talk to yourself««
@ Do some desk research«.
@ Review competitive advertising«

"'
@ «help launch a brand in this category
@ «suggest a persuasive and pocket-friendly promotion

strategy
@ «keeping mind the constraints

£ f the category that is low-involvement
£ A client who doesn·t have huge budgets
£ And a consumer with fickle loyalty levels!
$
(#

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@ The bottled water market is estimated at around Rs. 1,250 crores

@ The market is growing at around 25-30% a year and is expected to

@ The per capita consumption of packaged water in India is pitifully low

@ The annual bottled water consumption in India had tripled to 5

@ Global consumption of bottled water around 200 billion liters in ¶06

@ Bulk of the growth of the Indian market attributed to two reasons:

@ Per capita consumption in India is less than 5 litres/year

@ Indians are ranked tenth in bottled water consumption

@ Despite the large number of small producers, this industry

@ Parle, the first mover in the Indian market

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@ Rs 35 crore on ad and promotion of the regular Bisleri in

@ Bisleri plans to put up 32 new plants over the next two

@ Company launched 2 litre & 500 ml packs to suit various

@ Recently revamped the Aqua fina 500 ml carry pack and

@ It·s looking at building strong consumer engagement

@ as plans to introduce its global brand ¶Bonaqua· in

@ It is within the realm of possibility that Coca-Cola·s next

@ Pouches, glasses and cups

@ 200 ml (popular in flights)

@ 500 ml bottles ml (a huge hit among the youth)

@ Large 2 litre bottles

@ Bulk water - grew at a rate of 30 - 40% in 2002 alone

@ SrC A, B & B+ income groups reflecting changing lifestyles and

@ Consumption of bottled water in India is linked to the

@ PrT is growing in South

@ South India is the largest consumer of PrT material for

@ South India commands a market share of 48%

@ West India accounts for 28%

@ North and rast India, combined contributes to 24%

@ The main consumers no longer restricted to the upper

@ Driven to the category by lack of clean, hygienic water

@ The rural market

@ The regional players:

@ About 220 water units operate near Chennai alone

@ Companies rake in Rs 80 lakh to Re. 1 crore daily!

@ Ratio of each player's market share to the entire packaged

@ The water market is worth over Rs 1,250 crore

@ 70 lakh litres of water are sold in the city everyday

@ 5 million quarter-liter packets @ Re. 1 each

@ 75,000 1-liter bottles @ Rs. 10 to Rs.12 each

@ 100,000 12-liter cans @ Rs. 18 to Rs. 30 each

@ 25,000 20-25 litre bubble-top containers from Rs. 38

@ 10,000 water tankers carrying 12,000 litres each @ Rs. 700

@ The bubble top has become the mainstay in most homes

@ The residents are collectively spending more than Rs. 15 lakh

@ Residents got used to packaged drinking water during the

@ Railways is a huge potential market

@ Water bottles, especially the 2 litre variety, are fast

@ According to officials at Cherio, the railways order

@ It accounts for 5% of Cherio·s water sales

@ Competitors compete globally, internationally, nationally,

@ All brands are pretty much identical

@ Large number of players and increasing competition have

@ Though most consumers are health-conscious and all that,

@ They might ask for a ¶Bisleri· or ¶Water bottle· to the

@ Brand loyalty is almost non-existent!

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