News Analysis: Water PRs dodge the Dasani flak

With Coca-Cola pilloried for its Dasani brand, is the lucrative bottled water market the ultimate triumph of packaging over substance, asks Sarah Robertson

Executives at Coca-Cola GB were forced into a corner last week when front-page headlines slated its bottled water brand Dasani, just four weeks after its UK launch, for the 3,000 per cent mark up on what is reportedly simple tap water from Kent.

'Water water everywhere, nor any drop to drink' said The Guardian, 'Eau dear' reported The Observer, while the Financial Times proffered: 'Not the real thing'.

Dasani has been on the market in the US for a number of years and was launched in the UK so Coke could carve a slice of the lucrative bottled water market. However, industry insiders claim the American company has underestimated the sophistication of UK consumers and the UK market, and with proverbial egg on its face, Dasani sales are bound to dip at least in the short term.

Growing market

But Dasani brand manager Judith Snyder claims it is business as usual in its PR department and the brand will continue to be promoted in line with the original strategy.

Plans for the launch of mini brand Dasani Dinky in May are also unaffected by the jibes in last week's press.

With sales of best selling bottled water brand, Volvic, topping £98m last year, according to research body AC Nielsen, it is perhaps obvious why companies are trying to capitalise on a market that now accounts for 65 per cent of sales in the UK's soft drinks market. The volume and value of bottled water is expected to double again by 2011, according to soft drinks group Strathmore, which markets a bottled water under the same name.

Nestle and Danone stake a massive claim at the top end of the bottled water market, with Danone owning three of the top six and Nestle owning two. Interestingly, both companies sell their products as competition to each other.

Volvic's sales grew nearly 30 per cent in 2002 compared to the previous year, while Evian sales were up nearly 20 per cent, to £78m. Highland Spring is third with the traditional Scottish brand aimed at the more mature consumer selling £42m - up 20 per cent.

Vittel, in fourth place, proves yet another win for consumer giant, Nestle, which also owns the next bottled brand on the list, Buxton which sold £7m worth of its Peak District water last year.

When bottled water was launched, consumers eyed it with caution but industry insiders put its recent success down to consumers becoming more discerning, and steering away from sugar and salt laden products associated with obesity. People are now more likely to check labels, in the search for natural products.

Bottled water companies promote the message of purity and an association with a healthy lifestyle, often reinforced with sponsorship of sporting events and athletes.

The brands differentiate themselves by targeting different demographics.

For example, Highland Spring targets the older consumer and one of the latest additions to the market, H20 No Gas, launched by Extreme Drinks, targets the youth market of 16 to 24-year-olds.

By the company's own admission, it is the packaging that sells the product, not the product itself. Extreme Group chief executive Al Gosling says: 'Our packaging is what sells our product. As we are a small company, I do not think the Dasani issue will affect us.'

In fact bottled water promoters have welcomed the Dasani coverage, claiming it is an opportunity to educate the consumer about bottled water.

Julie McGarvey, partner at 3x1, which handles PR for Highland Spring, says: 'This could not come at a better time because of the assets of (Highland Spring's) provenance. It comes from an organic protected spring.

'The (Dasani) issue is about using the word pure. The public does not know the difference between spring, natural, mineral or tap water and there is a legal definition. This issue will allow us to educate the public.'

She adds: 'Perhaps Coca-Cola underestimated the maturity of the bottled water market in Europe, which is more sophisticated than in the US.'

Gosling maintains that if consumers pay more attention to labels, his own water, which took eight months to find, is set to benefit from the coverage. 'This issue will make the customer aware of what they are drinking,' he says.

'I think people are savvy, I do not think the industry is damaged.

People will look more at what they are buying. Having spent eight months finding the best water, we are quite happy about that.

'A lot of the success of bottled water is about brand, no two ways about it,' admits Gosling. 'The number one brand has to be Evian, because it is from the Alps, and we know it is cleaner than anything else we are drinking.'

Meeting needs

So is bottled water the ultimate triumph of packaging over substance?

Strathmore communications manager Simon Russell doesn't think so. 'When water so clearly delivers an important benefit to consumers, how can it be (packaging over substance)?

'Clearly people can achieve the necessary fluid intake to aid concentration and general well being from a range of different sources but the fact that so many people choose bottled water means that it must be meeting one or more needs,' he says

Snyder assumes a more philosophical stance. 'To paraphase Oscar Wilde, it is better to be talked about than not talked about. This week's events have created significant awareness for Dasani,' she says.

Public reaction to the coverage can only finally be judged from Dasani sales. The proof, as they say, is in the drinking.

SELLING THE BRANDS

- Highland Spring - 3x1 - Participation in Natural Mineral Water, a fundraising campaign for Breast Cancer Care and sponsorship of Organic Week and sports events

- H20 no gas - In-house - Advertised via its sister product, the Extreme Sports channel, sponsors extreme sports events and athletes

- Aqua Pura - Storm Communications - Now focuses on health benefits rather than provenance following relaunch in 2000. Sponsorship of GB Athletics team and 13 triathlons, produces the bottled water market to demonstrate knowledge of the market

- Strathmore - In-house - Informs consumers on their choices, and communicates the quality of the natural water source, based around consumer recognition of its significance.

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