Thirst for chic bottled brands
Shoppers snap up upmarket labels with the industry projected to reach 86.5 billion yuan in 2021
Drinking upmarket bottled water has become chic for China’s sophisticated shoppers.
The thirst for the right brands is growing despite rising prices as consumers go for the healthy option and leave fizzy, sugary soft drinks on the shelves.
Tang Min is a typical example of this new wave of conscientious customers.
She is a marketing manager at a Chinese boutique furniture store in Shanghai and buys an array of different kinds of bottled water.
“I choose mineral water of a specific brand for boiling tea and not just because it is healthier,” she said. “The taste will be impaired if I use distilled water.
“When my four-year-old son cries for carbonated beverages, I will give him a bottle of sparkling water instead,” Tang, 33, added. “I don’t want him to grow into a humptydumpty with a mouthful of decaying teeth.”
Consumers are increasingly going for this healthy option, a survey by market research company Mintel Group Ltd highlighted.
Between 2011 and 2016, China’s bottled water sector increased more than 12 percent annually on average.
Last year, the industry was worth 60.7 billion yuan ($9.1 billion) and is expected to hit 86.5 billion yuan by 2021, Mintel reported.
In 2016, 25,906 million liters of bottled water were consumed. The number will continue to grow to 30,699 million liters by 2021.
“Premiumization, or the increase in high-end brands which are considered healthier, is the major driver of increased consumption of bottled water in China,” said Li Lei, a research analyst at Mintel.
But then shoppers are not only buying more, they are going upmarket.
In the 400- to 800-milliliter sector, which is the leading category, mid- to high-end brands are taking an increasingly bigger share, Kantar Worldpanel revealed.
The consumer trends company reported that upmarket bottled water sales grew 27 percent from mid-2015 to mid2016.
This was much higher than the 5 percent posted in the low-end market during the same period.
Naturally, companies are scrambling to get a larger slice of the high-end sector.
In March, Shenzhen Ganten Food and Beverage released its Blairquhan series upmarket label. This included mineral and sparkling water priced at around 15 yuan a bottle, which was sold in hotels, cinemas, cafes, bars and luxury department stores.
The Blairquhan series was launched after the success of Nongfu Spring.
Based in Hangzhou in East China’s Zhejiang province, the company rolled out a high-end brand of mineral water in a glass bottle for 35 yuan in 2015.
International businesses have been quick to follow by dipping into this lucrative market.
In July, Reignwood Group, which distributes energy drink Red Bull in China, introduced Norwegian high-end bottled water brand Voss here.
A month later, Aoraki, the upmarket label marketed by French food producer Danone, made its debut in Shanghai and on e-commerce platforms.
“High-quality water sources are ‘premium’ among consumers,” Li at Mintel said.
Indeed, this was evident in a poll conducted by the market research group about the retail habits of 2,965 shoppers