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Bottled Water - US - January 2016

Bottled Water - US - January 2016

Total retail sales of bottled water posted estimated gains of 6.4% in 2015, reaching more than $15 billion, with strong year-over-year sales growth since 2011. Total category sales are expected to continue upward as consumers search for BFY (better-for-you) beverage alternatives and bottled water is perceived as a convenient drink option for healthier lifestyles.

This report examines the following areas:

Preference for tap water

Most bottled water varieties consumed moderately

Consumers drink a variety of beverages


OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY
The issues
Preference for tap water
Figure 1: Consumption – Any/frequent drinkers, October 2015
Most bottled water varieties consumed moderately
Figure 2: Consumption – Frequent/moderate drinkers only, October 2015
Consumers drink a variety of beverages
Figure 3: Beverage and coffee tracker – Any consumption, September 2015 and October 2015
The opportunities
New approaches to environmental concerns
Figure 4: Environmental attitudes and behaviors, October 2015
Consumers want added function
Figure 5: Ideal bottled water – Function/attributes, October 2015
Premium waters gain traction
Figure 6: Attitudes and behaviors toward premium water, October 2015
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Category grows 6.4% in estimated 2015
Bottled water segments see sales growth
Water filtration innovation, other beverages create competition
Health among drivers aiding bottled water growth
MARKET SIZE AND FORECAST
Category growth forecast to continue through 2020
Figure 7: Total US sales and fan chart forecast of bottled water, at current prices, 2010-20
Figure 8: Total US sales and forecast of bottled water, at current prices, 2010-20
Figure 9: Total US sales and forecast of bottled water, at inflation-adjusted prices, 2010-20
MARKET BREAKDOWN
Bottled water segments continue to see sales growth
Figure 10: Total US retail sales and forecast of bottled water, by segment, at current prices, 2010-20
Sparkling water experiences strongest growth through 2020
Figure 11: Growth and projected growth rates of bottled water (% change), by segment, at current prices, 2010-20
Other channels dominate category sales, supermarkets close behind
Figure 12: Total US retail sales of bottled water, by channel, at current prices, 2013 and 2015
Natural channel sales grow
Figure 13: Natural supermarket sales of bottled water, at current prices, rolling 52 weeks Oct. 6, 2013-Oct. 4, 2015
Figure 14: Natural supermarket sales of bottled water, by segment, at current prices, October 2015
Lime sparkling waters leads flavored waters at natural channels
Figure 15: Natural supermarket sales of flavored sparkling water, by flavor, at current prices, October 2015
Figure 16: Natural supermarket sales of flavored still water, by flavor, at current prices, October 2015
MARKET PERSPECTIVE
Water filtration products have high overall penetration
Bottled water sees competition from coffee, CSDs
Figure 17: Beverage and Coffee tracker – Any consumption, September 2015 and October 2015
MARKET FACTORS
Health concerns remain top-of-mind with consumers
Figure 18: Important to achieve good health – Any top three rank, May 2015
Key age group of bottled water drinkers on the rise
Figure 19: Growth rates of population (% change), by age, 2010-20
Declining household income challenges bottled water market
Figure 20: Median household income, in inflation-adjusted dollars, 2004-14
Households with children decline
Figure 21: Households, by presence of own children, 2003-13
Hispanic population experiencing growth
Figure 22: Growth rates of population (% change), by race and Hispanic origin, 2010-20
KEY PLAYERS – WHAT YOU NEED TO KNOW
Leading companies experience growth
Innovation helps fuel growth across bottled water types
Price, waste, threat of bans challenge bottled water industry
Flavors, sources, and functionality create unique innovations
MANUFACTURER SALES OF BOTTLED WATER
Leading companies see MULO sales growth
Manufacturer sales of bottled water
Figure 23: MULO sales of bottled water, by leading companies, rolling 52 weeks 2014 and 2015
WHAT’S WORKING?
Premium/craft/artisan waters increase presence at MULO channels
Enhanced and functional water innovation continues
Sparkling water sees continued growth and innovation
For the greater good
WHAT ARE THE CHALLENGES?
Price and packaging waste challenge greater growth
Industry continues to justify benefits in wake of bans
California drought fuels protest
WHAT’S NEXT?
Bottled water flavors become more sophisticated
Premium, artesian, and craft waters gain traction
Brands innovate with new water sources
Bottled waters see more functionality
Waters fuse with other beverages
THE CONSUMER – WHAT YOU NEED TO KNOW
Men, consumers aged 25-34, Hispanics among core drinkers
Ideal bottled water is natural and unflavored
Supermarkets, mass merchandisers top purchase locations
Price important consideration in bottled water purchase
Environmental concerns impact bottled water purchases
Majority prefer premium waters
Majority finds category too large, prefer water filtration methods
CONSUMPTION OF BOTTLED WATER
Still, unflavored bottled water, and tap water most consumed types
Figure 24: Consumption – Any/frequent/moderate drinkers, October 2015
CORE CONSUMERS
Men heaviest water drinkers
Figure 25: Consumption – Any, by gender, October 2015
Consumers aged 25-34 heaviest consumers of each bottled water type
Figure 26: Consumption – Any, by age, October 2015
Higher income influences bottled water consumption
Figure 27: Consumption – Any, by household income, October 2015
Parents heavy bottled water drinkers
Figure 28: Consumption – Any, by presence and age of children in the household, October 2015
The Hispanic bottled water consumer
Figure 29: Consumption – Any, by Hispanic origin, October 2015
IDEAL BOTTLED WATER
Ideal bottled water natural, unflavored spring water with vitamins
Spring water preferred water source
Figure 30: Ideal bottled water – Source, October 2015
Figure 31: Ideal bottled water – Source, by age and age of children in household, October 2015
Unflavored bottled water preferred
Figure 32: Ideal bottled water – Flavor, October 2015
Figure 33: Ideal bottled water – Flavor, by age, October 2015
Four in five consumers want additional function
Figure 34: Ideal bottled water – Function/attributes, October 2015
Figure 35: Ideal bottled water – Function/attributes, by age, October 2015
Natural, no artificial ingredients top claims
Figure 36: Ideal bottled water – Product claims, October 2015
Figure 37: Ideal bottled water – Product claims, by age, October 2015
Figure 38: Ideal bottled water – Product claims, by select demographics, October 2015
PURCHASE LOCATION
Supermarkets, mass merchandisers top purchase locations
Figure 39: Purchase location, October 2015
Figure 40: Share of bottled water new product/new variety/new range extension, by retail location, rolling year ending Jan. 5, 2016
Hispanics shop at supermarkets
Figure 41: Purchase location, by Hispanic origin, October 2015
Income level impacts bottled water retail purchases
Figure 42: Purchase location, by household income, October 2015
Function, flavor have greatest impact at natural, c-store channels
Figure 43: Product attributes, by purchase location, October 2015
PURCHASING ATTRIBUTES
Price important consideration
One third of drinkers look for no artificial ingredients
Consumers purchase in bulk
Figure 44: Purchasing attributes, October 2015
Attributes worth price for core consumers
Figure 45: Purchasing attributes, by select demographics, October 2015
Figure 46: Purchasing attributes, by age, October 2015
ATTITUDES AND BEHAVIORS – ENVIRONMENTAL IMPACT
Environmental concerns impact bottled water purchases
Preferences for reusable packaging over biodegradable
Figure 47: Environmental attitudes and behaviors, October 2015
Environmental concerns decrease with age
Figure 48: Environmental attitudes and behaviors, by age, October 2015
ATTITUDES AND BEHAVIORS – PREMIUM WATERS
Majority prefer premium waters
Figure 49: Attitudes and behaviors toward premium water, October 2015
Figure 50: Attitudes and behaviors toward premium water, by select demographics, October 2015
Figure 51: Attitudes and behaviors toward premium water, by age, October 2015
ATTITUDES AND BEHAVIORS – BOTTLED WATER PREFERENCES
Majority find category too large, prefer water filtration methods
Figure 52: Attitudes and behaviors toward product choice and water filtration, October 2015
Figure 53: Attitudes and behaviors toward product choice, by select demographics, October 2015
Figure 54: Attitudes and behaviors toward product choice and water filtration, by age, October 2015
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Fan chart forecast
Consumer survey data
Abbreviations and terms
Abbreviations
APPENDIX – MARKET
Figure 55: Total US retail sales and forecast of convenience/PET still water, at current prices, 2010-20
Figure 56: Total US retail sales and forecast of convenience/PET still water, at inflation-adjusted prices, 2010-20
Figure 57: Total US retail sales and forecast of jug/bulk still water, at current prices, 2010-20
Figure 58: Total US retail sales and forecast of jug/bulk still water, at inflation-adjusted prices, 2010-20
Figure 59: Total US retail sales and forecast of sparkling/mineral water/seltzer, at current prices, 2010-20
Figure 60: Total US retail sales and forecast of sparkling/mineral water/seltzer, at inflation-adjusted prices, 2010-20
Figure 61: US supermarket sales of bottled water, at current prices, 2010-15
Figure 62: US convenience stores sales of bottled water, at current prices, 2010-15
Figure 63: US drug store sales of bottled water, at current prices, 2010-15
Figure 64: US sales of bottled water through other retail channels, at current prices, 2010-15
APPENDIX – KEY PLAYERS
Figure 65: MULO sales of jug/bulk bottled water, by leading companies and brands, rolling 52 weeks 2014 and 2015
Figure 66: MULO sales of convenience/PET still water, by leading companies and brands, rolling 52 weeks 2014 and 2015
Figure 67: MULO sales of sparkling water, by leading companies and brands, rolling 52 weeks 2014 and 2015

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