Bottled water market flourishes despite East European economic woes

Related tags Bottled water Europe

With the four major international bottled water groups and a
handful of strong local players all keen to grow sales, the bottled
water market in East Europe has grown strongly in spite of economic
troubles in many markets - and is likely to continue to do so in
the future.

Bottled water sales in East Europe have seen double digit growth in each of the past five years, reaching more than 6,300 million litres in 2001, according to the 2002 East Europe Bottled Water Report​ from drinks consultancy Zenith International​.

Despite the economic difficulties experienced by the region in the late 1990s, volume has jumped by almost 90 per cent since 1996. "The market grew in all of the 15 East European countries covered by Zenith's research, gaining an overall 11.5 per cent in 2001,"​ commented Zenith research director Gary Roethenbaugh.

"Consumption has nearly doubled from 10 litres per person in 1996 to just short of 20 litres per person in 2001, but remains a long way behind the West European average which is set to pass 100 litres per person in 2002."

Thanks to a strong tradition, sparkling water dominates the East European market, taking more than two thirds of total volume. Still water, however, has doubled its share from 16 per cent in 1996 to 32 per cent in 2001.

"Growing awareness of health benefits and widespread poor tap water quality have paved the way for the bottled water industry. This helps explain the rapid growth of East Europe's youthful water cooler market and underlies the recent boost in still water consumption,"​ added Roethenbaugh.

Poland and Russia were the two leading countries in 2001, achieving a combined 45 per cent share of the total East Europe market. With much smaller populations and a greater concentration of industry activity, Slovenia and Croatia had the highest consumption levels at over 50 litres per person.

"The global 'big four' in bottled water - Coca-Cola, Danone, Nestle Waters and PepsiCo - have all spotted the opportunity in East Europe and have become the market leaders, but there are also many successful local players such as Jamnica in Croatia, Knjaz Milos in Serbia and Karlovarske in the Czech Republic,"​ continued Roethenbaugh.

"In an environment of growing acquisition activity and aggressive price discounting, bottled water looks set for sustained growth and change,"​ he added, concluding that bottled water sales were likely to edge towards 10,000 million litres by 2006.

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