Bottled water to beat fizzy drinks in five years

By staff reporter

- Last updated on GMT

Related tags: Bottled water, Soft drink

Bottled water consumption is expected to overtake fizzy soft drinks
around the world within five years, says a new report, with Nestlé,
Danone and PepsiCo leading the charge.

The global bottled water market is expected to show high growth in 2005, taking global consumption beyond 173bn litres. The market grew 4.7 per cent in 2004 to reach a volume of 163bn litres.

The new research, completed by drinks consultancy Zenith International​, predicts that global consumption per person of bottled water will overtake that of carbonated soft drinks within five years.

That would officially mark a significant new chapter in soft drink markets, yet in reality the ball is already rolling.

"Across the world consumers are increasingly turning to bottled water as it becomes more accessible and as the health and hydration benefits become more widely accepted,"​ said Zenith research director, Gary Roethenbaugh.

Western Europeans remain the biggest bottled water consumers, guzzling a little more than a quarter of world production.

Even in the UK, where consumers have sceptically stuck with tap water for many years, the bottled water market rose 50 per cent between 1999 and 2004, according to data from market research group Mintel​.

However, others are catching up with Western Europe fast. The Asia/Australasia region is thought to be on the verge of taking over the number one spot, with China and Indonesia pushing the top five and likely to relegate Italy to fifth by 2008, says Zenith.

The United States and Mexico, meanwhile, were the largest national markets in 2004.

In terms of market players, growth has largely benefitted Danone and Nestlé, who already had the big brands - Evian and Volvic, and Vittel respectively. Danone owns four of the top 10 brands by volume and Nestlé two.

Soft drinks giants PepsiCo and Coca-Cola have unsurprisingly begun to muscle in as health conscious consumers have begun to shun their traditional fizzy soda offerings.

PepsiCo has done a little better with two brands inside the top ten. Its Aquafina brand recorded double-digit growth in the third quarter of 2005, as did the group's fitness water, Propel, sold under the Gatorade label.

Coca-Cola, however, has got only one bottled water brand in the global top ten - further confirmation that it has been slower to adapt to consumer health trends than its big rival PepsiCo.

Even so, these four firms controlled 32 per cent of the bottled water market in 2004.

Mintel's report on the UK last year highlighted flavour innovation as one of the best ways to improve market share.

Related topics: Markets, Soft Drinks & Water

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