Bottled Mineral Water — A Marketing Coup?
There is a long history behind the plethora of brands of bottled mineral water available in supermarkets today. Some claim the history of bottled water dates back 12,000 years to when early mankind transported water from natural springs in animal skins to their living areas. A look at more recent history shows a trend toward health and hygiene in late 18th century Europe, where people would visit the natural mineral springs to bathe and drink the water straight from the source. In 1863, mineral water from a natural source located in South France was bottled at the demand of Napolean III. This mineral water is still produced today under its original name of Perrier. Over the next one hundred years, many of the European spas followed suit and began bottling their own mineral water from the source, including several popular brands still known today such as Evian, Vittel and Spa.
The real boom in the bottled mineral water market came in the late 1970s when Perrier decided to promote bottled mineral and spring water through a large international advertisement campaign. Also during this timeframe, struggling international soft drink companies followed suit and moved into the bottled water segment, leading to an explosion in available brands of mineral water.
Applying the term coup to the bottled water market
A coup refers to a brilliantly executed strategy, a triumph. The term unexpected is also often associated with the word. So in breaking down the definition of a coup, one can easily apply the term to the bottled mineral water industry.
1. Brilliant Strategy Execution
When looking at the strategies of the numerous bottled mineral water companies, there can be similarities found, whether it is a multinational company with ownership of several brands (Nestle) or a single brand such as Gerolsteiner in Germany. The first common strategic emphasis is on quality. As water is vital to life, the emphasis on quality in the mineral water companies’ business strategy speaks directly to the consumer. Perrier, for example, encourages consumers to “Get Fresh — With Perrier.” Nestle publishes its quality reports for all brands on its homepage, and promotes its highly trained employees, sanitation methods and analytical technology as key factors for a high quality product. Similarly, Gerolsteiner of Germany boasts of the pure quality of its mineral water, referring to it as one of nature’s wonders.
In addition to quality, mineral water companies are continually using innovation as part of their strategies. Keeping up with changing consumer preferences is a top priority in the bottled mineral water segment. These innovations, once again, come from both large and small players in the market. Packaging innovations are typically among the most popular, as the companies try to figure out the best bottle shape for on the go consumption and transportation.
The third and perhaps most important aspect of the strategy of bottled mineral water companies is their ability to manufacture demand. This is accomplished through strong advertisement campaigns which convince consumers to spend their money on a product they, in some cases, have cheaper access to at home.
The idea of unexpectedness can also be applied to the bottled mineral water market. As stated above, one of the most significant international marketing campaigns came in the 1970s when the French brand, Perrier, decided to push across the French borders into the rest of Europe and the United States. This movement was not expected to work and the Financial Times even wrote that the mineral and spring water being advertised by Perrier would only be purchased by cranks and foreigners. Most people laughed off the idea of buying something that could be obtained at a very cheap price in the comfort of one’s own home. Despite the initial negative reaction, Perrier and other bottled water companies were able to convince consumers to drink their product through manufacturing demand.
The power of marketing was clearly not considered by the Perrier critics in the 70’s. In 1988, just 12 years after entering the U.S. market, Perrier sold 300 million bottles of water, both mineral and spring, which amounted to 80% of the imported bottled water market.
Aside from Perrier’s triumph in America, it is safe to say bottled mineral water has triumphed in my local market, Germany. An analysis was conducted to ascertain the price difference that exists between tap water and bottled mineral water in Germany. The results show that consumers are paying an average of 50 cents per liter of bottled mineral water when they could get a liter of tap water for less than half a cent. Despite this fact, consumption of bottled water in Germany jumped from 101 liters per person per year in 1999, to 134 liters in 2010.
Aside from the competition posed by over 450 brands of bottled mineral water in Germany, competition is intensified by another market player: tap water. The quality of tap water in Germany is quite high and is compliant with the EU directive for drinking water. I can personally attest to the quality of tap water as I made the switch from bottle to tap upon arrival in 2009. Despite the high quality of tap water, Germany still ranks as the eighth-largest bottled water market in the world. You may ask, “How can this be?” My answer is, aside from the fact that German’s really like bubbles in their water, the success of bottled mineral water in Germany can be attributed to excellent marketing tactics.
Manufactured Demand — A Marketing Coup
The first tactic used by bottled mineral water companies is the fear tactic. In essence, consumers are being told the safest drinking water is found in a bottle, indirectly implying that what they are drinking at home from the tap is unsafe. Proof of this tactic can be found, for example, directly on the Gerolsteiner website, a popular German mineral water brand. They state:
“ In contrast to conventional drinking water, most of which is obtained from ground and surface water and is chemically treated and sanitised, Gerolsteiner comes from up to 250 meters deep below the earth’s surface.”
Upon reading or hearing this, a consumer is led to believe that the water coming out of their faucets at home cannot be trusted. It seems as though the only pure water comes from a depth of 200 meters. Mineral water companies use this tactic all over the world. They promote the idea that bottled mineral water is pristine. This can be identified by the packaging that is used. The idea of mineral water coming from the mountain tops and pristine locations seen on the labels and in advertisements appeals to customers, especially when set in comparison to the sanitation and processing facilities located on the outskirts of town that provide the homes with tap water.
Another tactic that tilts favor to bottled mineral water is the advertising of health benefits. Gerolsteiner, for example, advocates the importance of understanding the mineral make-up of the water we drink. They have an entire section dedicated to health on their website. Gerolsteiner convinces people that the water they produce can restore the body, providing it with trace elements the body cannot produce itself. Telling consumers their body is lacking trace elements is a combination of health benefits and fear tactics. The fact that one can provide his body with healthy “trace elements” simply by drinking a liter of Gerolsteiner is very appealing to consumers.
Promoting the taste of bottled mineral water is another tactic used by many companies. A growing trend in Germany is to have not only a wine list, but also a mineral water list available to customers at top hotels and restaurants. These lists include brands of mineral water such as Bling H2O from the United States, selling for just under €50 per bottle, and a Canadian brand claiming that the water inside is over 10,000 years old, selling for nearly €9 per bottle. At these restaurants and hotels, the correct flavored bottle of mineral water that suits the choice of a meal is recommended by experts, just like a bottle of wine. The claim is that the taste of the various bottled mineral waters is what sets it apart from tap water. Even Gerolsteiner promotes the taste of its water both in commercials and on its website. Its taste is promoted as being refreshing and appropriate for all occasions. Citing its natural balance of minerals, Gerolsteiner states that the water tastes neither salty nor bitter but simply refreshingly natural.
Fear tactics, its pristine nature compared to tap water, the claim of superiority in taste, and the health benefits obtained from a liter of bottled mineral water are all factors that are being communicated not only to German consumers, but also consumers around the world.
Does bottled mineral water represent one of the biggest marketing coups of all time? I would say it depends. For Germany, and perhaps some regions in the United States, my answer would be yes. However, from a pure taste stand point, I would not drink the tap water from my hometown in California (it tastes like water from a swimming pool). It is a whole different story for me in Germany, where the tap water is safe and refreshing. Luckily, my German wife does not need bubbles in her water either, so we are able to save money and my back, as I do not have to carry any huge cases up to our second floor apartment.
In the case of underdeveloped countries/regions, where people are not necessarily exposed to the barrage of messages from companies, bottled water serves as a great source of drinking water in regions where this is otherwise considered a scarce resource.
Do you drink bottled mineral water despite having a cheaper, readily available alternative at your fingertips at home? If so, why?