Why the Strategies Behind Nestlé’s New Bottled Water Brand May Be Good for the Company but Bad for Public Water

Photo retrieved from: www.fuelandwash.com

“As many consumers in the United States and Europe are dropping bottled water, the industry is beginning to see a decline in sales. In fact, between 2007 and 2010, Nestlé Waters, the biggest water bottler in the world, saw its total sales drop 12.6 percent.

Today, Nestlé appears to have developed new strategies to combat this challenging sales climate, which center around its Pure Life brand. Unfortunately, while the brand has been profitable, these tactics do not bode well for public water in the United States or abroad.

Nestlé has shifted the focus of its advertising dollars in the United States to its new Pure Life brand. Between 2004 and 2009, spending on Pure Life advertising increased by more than 3000 percent; the company’s nearly $9.7 million expenditure on the brand in 2009 was more than any other bottled water company spent on a leading domestic brand, and more than Nestlé’s next five spring water brands combined.

While Nestlé’s global water division’s sales are falling in Europe, the United States and Canada, they are growing rapidly in the “emerging markets” that Nestlé is targeting in the rest of the word. In 2010, Nestlé’s sales of bottled water in these “other regions” increased by 25 percent over its 2009 sales in these areas.

Pure Life differs from Nestlé’s previous brands in the United States in terms of the source of its water, the messaging used to sell it, and its target audience:

• Pure Life bottles municipal tap water rather than spring water, which can help the company avoid the costly conflicts over water access and labeling that have plagued its spring water operations in the past, allowing it instead to vie with its main competitors, PepsiCo and Coca-Cola, on price.
• The company focuses its messaging on the health benefits of bottled water, especially compared to sugary soft drinks, which improves the image of its product and helps it appeal to parents and teachers who are concerned about their children’s health.
• It also specifically targets Hispanic immigrants in the United States and “emerging markets” in developing nations abroad — consumers who are accustomed to inadequate water infrastructure and therefore less inclined to drink from the tap because of safety concerns.”

Read more: Food & Water Watch