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The U.S. Market for Bottled, Enhanced and Flavored Water - 3rd Edition


Attention: There is an updated edition available for this report.

Chapter 1: Executive Summary

  • Scope and Methodology
  • Scope of Study
  • Study Methodology
  • Bottled Water Definition
  • Pure Bottled Water: Primary Types
  • Purified Bottled Water
  • Three Product Categories
  • Two Niche Product Segments
  • Flavored Water
  • Enhanced Water
  • Government Regulation
  • The Federal Level
  • The State Level
  • Industry Regulation
  • FDA Establishes Standards of Identity
  • The Market
  • $6.7 Billion in 2003
  • Table 1-1: U.S. Retail Sales of Bottled Water, by Category and Total, 1998-2003
  • Food Stores Lead in Retail Bottled Water Sales
  • Figure 1-1: Share of Bottled Water Sales by Channel
  • Discounters and C-Stores
  • Bottled Water at $2.9 Billion in FDM Outlets
  • Table 1-2: IRI-Tracked Retail Sales of Bottled Water, By Category and Total, 1998-2003
  • Tremendous Success Driven by PET
  • Volume/Gallon Sales
  • Bulk Trumps PET in Gallonage
  • Multipacks Major Sellers
  • Enhanced Waters Booming
  • Per Capita Consumption
  • Water to Surpass Coffee, Beer, Milk
  • Bottled Water vs. Tap Water
  • Convenience
  • Active Lifestyles, Exercise/Fitness, Health/Wellness
  • Aging Baby Boomers
  • Market Still Not Mature
  • Price Wars
  • Supply Limitations?
  • Projection: Over $12 Billion by 2008
  • Figure 1-2: Market Projection of All Bottled Water, 2004-2008
  • The Marketers
  • At the Top: Four Now Three
  • Secondary, Tertiary Marketers
  • Enhanced Water Leaders
  • Nestle Dominates Bottled Water Sales
  • Table 1-3: Marketer Share of Retail Bottled Water Sales, 1998-2002
  • Emerging Three-Way Competition in 2003
  • PET Shares: Nestle, PepsiCo, and Coke/Danone
  • PET Brand Shares
  • Bulk/Jug Share
  • Mineral/Sparkling Share
  • Advertising Expenditures
  • New Product Trends
  • Flavored Waters
  • Enhanced Waters
  • Calcium and Oxygen Waters
  • Ultrapristine Waters
  • PET Packaging Pervasive
  • Distribution/Retail
  • Distribution Key to Success
  • From Intermediary to Direct Distribution
  • Greater Visibility at Retail
  • Supermarkets
  • Discount Stores
  • Convenience Stores
  • Natural Food Stores
  • The Consumer
  • Number of Users
  • Skew to Women
  • Skew to Non-Whites
  • West Best Region
  • Strong Composite Consumer Profile

Chapter 2: The Products

  • Scope of Study
  • The Retail Bottled Water Market
  • Extra-Retail Channels Largely Excluded
  • Artificially Carbonated Products Not Included
  • Purification, Modification Products Excluded
  • Definitions/Classifications
  • Defining Bottled Water by What It Is Not
  • Not Another Beverage Type
  • A Positive Definition
  • Two General Classes: Pure and Purified
  • Five Pure Types
  • Spring Water
  • Well Water and Artesian Well Water
  • Mineral Water
  • Sparkling Water
  • Purified Water Types Based on Processing Technique
  • Reverse Osmosis
  • Ozonation
  • Micron Filtration
  • UV Treatment
  • Distillation
  • Beyond Pure/Purified: Other Classification Schemes
  • Three Product Categories: Convenience/PET, Bulk/Jug, and Mineral/Sparkling
  • Two Niche Product Segments
  • Flavored Water
  • Enhanced Water
  • Enhanced Water Ingredients
  • Nutraceutical Types
  • Flavors and Sweeteners in Enhanced Water
  • Enhanced Waters Blur External, Internal Boundaries
  • Packaging
  • Overview
  • Packaging Materials
  • Bottle Shapes, Texture, Colors
  • Sizes 32
  • Multipacks
  • Regulation
  • Two Governmental Levels
  • The Federal Level: FDA and EPA
  • The FDA’s Direct Role
  • Bottled Water as a Food
  • Mandating Testing
  • The EPA’s Indirect Role
  • FDA, EPA, and Stricter Labeling Rules
  • The States Tasked with Enforcement
  • Some States Stricter Than Others
  • The Industry Regulates Itself
  • IBWA Model Code
  • Nutritional Labeling and Education Act
  • FDA Establishes Standards of Identity
  • FDA Definitions: Mostly Fastballs, Some Curveballs
  • Knuckleball Municipal Descriptors

Chapter 3: The Market

  • Market Size, Growth, and Composition
  • Retail Bottled Water Market at $6.7 Billion in 2003
  • Table 3-1: U.S. Retail Sales of Bottled Water, by Category and Total, 1998-2003
  • Figure 3-1: U.S. Retail Sales of Bottled Water by Total 1998-2003
  • Growth by Product Category
  • A Spectacular Performance by Bottled Water: Some Testimony
  • Some Reasons for Recent Stellar Growth
  • Food Stores Lead in Retail Bottled Water Sales
  • Figure 3-2: Share of Bottled Water Sales by Channel
  • Discounters and C-Stores
  • Other Retail Outlets
  • From Soft Approximations to Hard Data
  • Bottled Water at $2.9 Billion in Retail Outlets
  • Table 3-2: IRI-Tracked Retail Sales of Bottled Water, By Category and Total, 1998-2003
  • Strongly Up in 2003
  • Tremendous Success Driven by PET
  • Bulk/Jug and Mineral/Sparkling Lackluster
  • Bulk/Jug Remains Important
  • Mineral/Sparkling Tied to Economy
  • PET Eclipses B/J and M/S
  • Table 3-3: Retail Share of U.S. Bottled Water Market by Category, 1998-2002
  • Figure 3-3: Share of Bottled Water Sales by Category, 1998
  • Figure 3-4: Share of Bottled Water Sales by Category, 2002
  • M/S Caveat Regarding the Discount Sector
  • Volume/Gallon Sales
  • Table 3-4: Change in Volume Sales of Bottled Water, by Category, 2001-2002
  • Figure 3-5: Change in Volume Sales of Bottled Water, by Category, 2001-2002
  • Bulk Trumps PET in Gallonage
  • Unit Sales Favor PET
  • Table 3-5: Change in Unit Sales of Bottled Water, by Category, 2001-2002
  • Figure 3-6: Change in Unit Sales of Bottled Water, by Category, 2001-2002
  • Price Averages by Product Category
  • Table 3-6: Average Price Per Gallon of Bottled Water, by Category, 2001-2002
  • Bottled Water Gallons Double, PET Cases Quadruple
  • Multipacks Major Sellers
  • Flavored Waters Ascending
  • Enhanced Waters Booming
  • Seasonality: Summer is Hot
  • Table 3-7: IRI-Tracked Sales and % Share of Retail Bottled Water Sales, by Quarter, 2002
  • Figure 3-7: IRI-Tracked Sales and % Share of Retail Bottled Water Sales, by Quarter, 2002
  • Regionality
  • Factors in Future Growth
  • Overview: Future Looks Bright
  • Establishing Context: The Beverage Universe
  • Bottled Water Per Cap Leaps
  • Figure 3-8: U.S. Per Capita Bottled Water Consumption, 2000-2002
  • Other Beverages Lackluster by Comparison
  • Despite Water’s Gains, Soft Drinks Still Rule
  • Water to Surpass Coffee, Beer, Milk
  • The Trend to Noncarbonated Drinks
  • Soft Drinks the Big Victim of the Trend
  • Will Other Noncarbs Arise to Challenge Water?
  • Overview: Alternative Beverages
  • From Where Will Bottled Water Get Its Future Share?
  • Its Prime Rival: Tap Water
  • Tap Water’s Bad Name
  • Widespread Skepticism Toward Tap
  • Figure 3-9: U.S. Consumption of Water Based on Source
  • But Is Bottled Water Really Safer?
  • The Answer: Yes, But...
  • IBWA vs. NRDC
  • Literary and Aesthetic Critics
  • Bottled Water Winning the Perceptual Battle over Tap
  • No Real Obstacles, So It’s Up, Up, and Away
  • Positive Factors: Convenience in Its Four Aspects
  • Portability
  • Ubiquity
  • Reliability
  • Flexibility
  • Active Lifestyles
  • Active by Default: On the Run
  • Active by Choice: Exercise
  • Bottled Water Best Beverage for Active Lifestyles
  • Water, Diet, and the Health/Wellness Trend
  • Healthy Choices and Social Life
  • Exercise, Health, and the Baby Boom
  • Water Sales Rage as Boomers Age
  • Echo Boomers Follow Parents’ Lead
  • Kids and the Obesity Epidemic
  • A Strong Market Poised to Grow Stronger
  • Pulling in Men and Ethnics
  • Market Stimulated by New and Enhanced Products
  • Convenience, Health Trump Economy
  • Top-Gun Marketing Also Stimulates Demand
  • Negative Events Perversely Positive for Bottled Water
  • Global Warming Good for Bottled Water
  • Potential Negative Factors: Ironic Outcomes of Success
  • Price Wars
  • Greater Consumer Awareness a Double-Edged Sword
  • Case in Point: California
  • Then There's Maine
  • What if Demand Outstrips Supply?
  • Market Projections
  • Over $12 Billion by 2008
  • Table 3-8: Projected Growth of Convenience/Pet Bottled Water, 2004-2008
  • Table 3-9: Projected Growth of Bulk/Jug Bottled Water, 2004-2008
  • Table 3-10: Projected Growth of Mineral/Sparkling Bottled Water, 2004-2008
  • Table 3-11: Projected Growth of All Bottled Water, 2004-2008
  • Figure 3-10: Market Projection of Convenience/Pet Bottled Water, 2004-2008
  • Figure 3-11: Market Projection of Bulk/Jug Bottled Water, 2004-2008
  • Figure 3-12: Market Projection of Mineral/Sparkling Water, 2004-2008
  • Figure 3-13: Market Projection of All Bottled Water, 2004-2008
  • Projections by Category

Chapter 4: The Marketers

  • Number of Marketers
  • Size of Marketers
  • Marketers by Type
  • Marketer/Brand Structure
  • Marketer/Category Structure
  • At the Top: Nestle, Coke, Danone, PepsiCo
  • Nestle Waters North America
  • Coca-Cola and Danone Waters
  • PepsiCo
  • Suntory and C.G. Roxane
  • Tertiary Marketers
  • Significant Regionals
  • Significant Import Brands
  • Enhanced Water Leaders
  • Table 4-1: Selected Minor Bottled Water Marketers and Their Brands
  • Marketer and Brand Shares
  • Explanatory Note
  • Overall Marketer Share: Nestle on Top
  • PepsiCo Shoots up to No. 2 in 2002
  • Table 4-2: Marketer Share of Retail Bottled Water Sales, 1998-2002
  • Figure 4-1: Marketer Share of Retail Bottled Water Sales, 1998
  • No. 3 Danone Sinks Like a Stone
  • Figure 4-2: Marketer Share of Retail Bottled Water Sales, 2002
  • Coke: Out of Nowhere to No. 4
  • Emerging Three-Way Competition
  • Coke/Danone Catapults over PepsiCo
  • Nestle Under Pressure
  • All Other Marketers Suffer, But Stabilize
  • Private Labels Decline But Remain Potent
  • Marketer Shares: PET
  • Table 4-3: Marketer Shares of Retail PET Water Sales, 1998-2002
  • Figure 4-3: Marketer Shares of Retail PET Water Sales, 2002
  • Brand Shares: Aquafina and Dasani Lead
  • Table 4-4: Brand Shares of Retail PET Water Sales, 1998-2002
  • Other PET Brands
  • Marketer Shares: Bulk/Jug
  • Table 4-5: Marketer Shares of Jug/Bulk Water Sales, 1998-2002
  • Brand Shares: Bulk/Jug
  • Table 4-6: Brand Shares of Retail Jug/Bulk Water Sales, 1998-2002
  • Figure 4-4: Brand Shares of Retail Bulk/Jug Water Sales, 2002
  • Marketer Shares: Mineral/Sparkling
  • Table 4-7: Marketer Shares of Mineral Water Sales, 1998-2002
  • Brand Shares: Mineral/Sparkling
  • Table 4-8: Marketer Shares of Mineral Water Sales, 1998-2002
  • Figure 4-5: Brand Shares of Retail Mineral Water Sales, 2002
  • Enhanced Water Share
  • Figure 4-6: Growth of Enhanced Water Segment
  • The Competitive Situation
  • Before: Lazy Competition Between Regionals and Imports
  • After: Bottled Water Throttles into Hypercompetition
  • The Consolidation Dynamic
  • Transformations and the Top Three
  • Nestle: Strengths and Weaknesses
  • Coke/Danone: Strengths and Weaknesses
  • PepsiCo: Strengths and Weaknesses
  • Coke Fires First Salvo in Price Wars
  • PepsiCo Ignores Coke’s Challenge
  • Coke’s Low-Ball Dannon Strategy Successful
  • Portentous Overtones: Coke Cannibalizing Dasani
  • Nestle and Roxane Match Coke’s Price Cuts
  • Price War Critics
  • Price Wars Threaten Brand Equity
  • National Branding Key to Bottled Water Success
  • National Branding Achieves Three Competitive Goals
  • From Regional/Import to National Brand Structure?
  • Obstacles in the Way: Price Wars, Enduring Regionality
  • Nationals Sell No Bulk/Jug
  • The “Cognitive Dissonance Trap”
  • Overcoming Obstacles through Ad/Promo Efforts
  • Extending into Multipacks
  • Segmenting into Enhanced Water
  • Competition and the Smaller Marketer
  • Offering Enhanced and Premium Waters
  • QAI: A New Premium Tool
  • Other Smaller Marketer Strategies: Regional Perseverance
  • Offering Flavors
  • Orienting to Private Label
  • Combo Strategies
  • All Small and Large Marketers Vulnerable to Consolidation
  • Competitive Profile: Nestle Waters North America
  • Nestle Waters Is Actually Perrier Group
  • Perrier Builds American Bottled Water Empire
  • Nestle Acquires Perrier
  • PGA Changes Name to Nestle Waters
  • Nestle Way on Top of Bottled Water
  • Tentative Steps into Enhanced
  • Recent Competitive Moves
  • Nestle’s Regional Strengths
  • Ramping up Production to Stay on Top
  • Who Owns What Water Where?
  • Nestle Faces Water Rights Battles
  • Resistance in Michigan
  • Dust-Up in SoCal
  • Class Action Lawsuit over Poland Spring Labeling
  • Potential Black Eye for the Industry
  • Competitive Profile: Coca-Cola Co. and Coke/Danone
  • Coke Intros Dasani in 1999
  • A Feather in Coke’s Cap
  • Dasani
  • Danone’s Fall from Grace
  • Evian and Dannon Plummet
  • Coke acquires Danone Waters in a “Hedged Merger”
  • First Evian
  • Then Dannon and Other Danone Brands
  • Coke/Danone Partnership Provisions
  • Advantages Accruing to Coke
  • Advantages for Danone
  • Disadvantages of the Deal
  • Slashing Dannon, Cannibalizing Dasani
  • Supporting Dasani
  • Testing Dasani Nutriwater
  • Coke Gaining a Global Water Presence
  • Competitive Profile: PepsiCo
  • A Leader in Soft Drinks and Other Beverages
  • PepsiCo Creates National Market with Aquafina
  • Innovator in Sourcing and Naming
  • Other Components of PepsiCo’s Model
  • Aquafina Straight to the Top
  • Two New Enhanced Waters
  • Aquafina Essentials
  • Propel Fitness Water
  • Positioned as a Sports Drink
  • Competitive Profile: Suntory Water Group
  • Home/Office Leader
  • Regional Brand Network
  • 2002: Realigning to Retail
  • H/O Biz on the Block
  • H/O Merger with Danone
  • Sizing Up the Suntory/Danone Merger
  • Competitive Profile: Energy Brands
  • Tops in Natural Food Stores
  • Pioneering Enhanced Brand: Glaceau
  • Glaceau Vitaminwater
  • Tea Vitaminwaters
  • Glaceau Flavors
  • New Investor in Energy Brands
  • Competitive Profile: Dr. Pepper/7 Up
  • Deja Blue: New Major Brand?
  • Tested Regionally, Rolling Out National
  • A National Brand for Indy Distributors
  • Consumer Advertising Expenditures
  • Ad Spending Quadruples
  • PepsiCo and Coke Expenditures
  • Nestle Expenditures
  • Other Ad Spending
  • New Product Trends
  • Overview
  • Flavored Waters
  • Enhanced Waters
  • Complex Enhanced
  • Simple Enhanced
  • Calcium and Magnesium
  • Unique Ingredients
  • Diet Waters
  • Oxygen Waters
  • Healthy-By-Nature Waters
  • Superior-Source Waters
  • Charity and Promotional Waters
  • Native American Waters
  • Licensed Waters
  • Children’s Waters
  • Pet Waters
  • Packaging Trends: PET
  • Boxes/Pouches
  • Carriers
  • Sport Caps
  • The Fridge Pack
  • Novelty Packaging
  • Table 4-9: Selected New Bottled Water Product Introductions: 2002-2003

Chapter 5: Distribution/Retail

  • Distribution
  • Key to Success
  • Traditional Distribution
  • Intermediary Distribution
  • Direct Distribution
  • Indys Squeezed
  • At the Retail Level
  • Bottled Water’s Greater Visibility
  • PET Multipacks Proliferate
  • Margins
  • Evolving Category Management
  • Brief Retail Profiles: Supermarkets
  • Discount Stores
  • Convenience Stores
  • Natural Food Stores
  • Drugstores
  • Vending Machines

Chapter 6: The Consumer

  • The Simmons Survey System
  • The Consumer: Overview
  • Number of Users
  • Number of Users: By Sex
  • Percentage of Users: By Race
  • Figure 6-1: Percentage of Bottled Water Users by Race
  • Number and Percentage of Users: By Region
  • Figure 6-2: Percentage of Bottled Water Users by Region
  • Skew to West, Then Northeast-Midwest Least
  • Consumer Miscellanea
  • Consumer Profiles
  • A Strong Composite Profile
  • Brand Profiles by Demographic Factor
  • Brand Profiles: By Age
  • By Sex
  • By Race
  • By Region
  • By Education
  • By Employment Status
  • By Household Income
  • By Marital Status
  • By Household Size
  • By Age of Children
  • Table 6-1: Consumer Profile of Bottled Water Users, By Brand and Characteristic

Chapter 7: Trends and Opportunities

  • Focusing Branding Efforts
  • Enhanced Water and Documentation
  • Targeting White Males
  • Avoiding Price Wars
  • Honest Labeling
  • Bulk/Jug Branding

Appendix: Addresses of Selected Marketers

The absolutely outstanding growth of the $4 billion bottled water market continues to astound. In a slow-growth economy mired in deflationary expectations, it is astonishing to see a well-established market skyrocketing upward at 15%-20% annual rates. Yet such is bottled water, the brightest star in the beverage universe. This all-new Packaged Facts study on bottled water - completely revised, reorganized, and updated - focuses exclusively on the retail market. It comprehensively analyzes the reasons behind bottled water's phenomenal rise to dollar and consumption levels previously undreamed of; thoroughly examines the intensifying consolidation clash occurring among global beverage rivals Coca-Cola/Danone (Dasani, Evian), Pepsico/Quaker (Aquafina, Propel), and Nestle/Perrier's family of regional brands; and insightfully assesses the incredible future promise and potentially perilous pitfalls inherent in continued bottled water ascendancy. Featured in this study are numerous tables and graphs devoted to market growth patterns and marketer/brand shares, a detailed listing of new products (enhanced waters and other unique niches), profiles of bottled water consumers, and in-depth discussions of regulation, factors in future growth, competitive dynamics, and retailer attitudes toward bottled water - a true growth market for the 21st century.

Report Methodology
The information in The U.S. Market for Bottled and Enhanced Water is based on both primary and secondary research. Primary research involved on-site examination of the retail milieu, interviews with marketing, public relations and industry analysts within the bottled water market and consultants to the industry. Secondary research entailed data-gathering from relevant trade, business, and government sources, including company literature. Packaged Facts has derived mass merchandiser sales figures from Information Resources, Inc. (IRI) InfoScan sales-tracking data. Figures provided on national consumer advertising expenditures are based primarily on data (copyright 2002) compiled by TNS Media Intelligence/CMR, the leading provider of strategic advertising and marketing communications intelligence. The analysis of consumer demographics derives from Simmons Market Research Bureau survey data for spring 2003. New product information is gathered via literature research, personal interviews and data compiled by ProductScan, a service of Marketing Intelligence Service Ltd.

What You’ll Get in this Report
The U.S. Market for Bottled and Enhanced Water is a brand-new report that offers a unique perspective on the changing market for bottled spring and fortified waters. No other market research report provides both the comprehensive analysis and extensive data that The U.S. Market for Bottled and Enhanced Water offers. The report addresses the following segments:

  • The Market (including market size and composition, and projected market growth)
  • The Marketers (including discussions of specific marketer brand and market shares)
  • Competitive Profiles (of the mainstream marketers, specialists and up-and-coming niche players, and analyses of the products they market)
  • Retail Strategies
  • The Consumer (who’s buying what, and where)
  • The Products
  • Trends and Opportunities

Plus, you’ll benefit from extensive data, presented in easy-to-read and practical charts, tables and graphs.

Scroll down to see a more detailed outline of the contents of this report.

How You Will Benefit from this Report
If your company is already competing in the bottled water market, or is considering making the leap, you will find this report invaluable, as it provides a comprehensive package of information and insight not offered in any other single source. You will gain a thorough understanding of the current market for bottled and enhanced waters, as well as projected sales and trends through 2008. Contributing to that understanding will be a complete analysis of sales data from IRI and other published and trade sources, a detailed discussion of the consumer for bottled water based on Simmons data.

This report will help:

  • Marketing Managers identify market opportunities and develop targeted promotion plans for bottled and enhanced water.
  • Research and development professionals stay on top of competitor initiatives and explore demand for products in the retail bottled water arena.
  • Advertising agencies working with clients in the beverage industry understand the product buyer to develop messages and images that compel consumers to purchase these products.
  • Business development executives understand the dynamics of the market and identify possible partnerships.
  • Information and research center librarians provide market researchers, brand and product managers and other colleagues with the vital information they need to do their jobs more effectively.


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