Download - PNWS-AWWA 2008 Annual Conference Bottled Water: Tapping the Trends Patrick Weber Brown and Caldwell
PNWS-AWWA 2008 Annual Conference
Outline
What is bottled water? Industry growth and consumer
choices Marketing strategies Regulations and standards Water quality and independent
studies Plastic bottles Tips for personal use
PNWS-AWWA 2008 Annual Conference
Why does this matter?
It’s an important related industry–Maintain awareness of trends
Despite media attention, not necessarily bottle vs. tap–Some ads both ways take that
approach–Cases of “implied impurity”
Is growth in bottled water consumption a threat to municipal suppliers?–Not directly–Public perception is important
We’ll come back to this
PNWS-AWWA 2008 Annual Conference
What is bottled water?
Sources:–Artesian–Spring–Mineral–Well–Municip
al–Surface
FDA rules for labeling certain types
PNWS-AWWA 2008 Annual Conference
What is bottled water?
Containers:–Bottle–Water
cooler–Counter-
top spigot–Gallon jug–Other
Materials–Plastic–Glass
PNWS-AWWA 2008 Annual Conference
What is bottled water?
For U.S. consumers:–60-70% sold in the same state it’s
bottled–About 5% imported–About 25% from municipal sources
Aquafina and Dasani reportedly going to voluntarily label as “from public sources”–Both do reverse osmosis and/or
other filtration and mineral addition Many bottlers do some type of
filtration or other treatment, or add minerals for taste
Other types: sparkling, flavored, vitamin enhanced, etc.
PNWS-AWWA 2008 Annual Conference
Consumption Trends
The bottled water industry is the 2nd largest commercial beverage category in the US.
In 2007 there were 8.8 billion gallons of bottled water sold in the US, which is an increase of 6.9% from the previous year.
The average consumption in the US was over 29 gallons per person, more than any other beverage annually.
PNWS-AWWA 2008 Annual Conference
Consumption Trends
U.S. BOTTLED WATER MARKET
Volume and Producer Revenues
2000 - 2008(P)
Millions of Annual Millions of Annual
Year Gallons % Change Dollars % Change
2000 4,725.1 -- $6,113.0 --
2001 5,185.3 9.7% $6,880.6 12.6%
2002 5,795.7 11.8% $7,901.4 14.8%
2003 6,269.8 8.2% $8,526.4 7.9%
2004 6,806.7 8.6% $9,169.5 7.5%
2005 7,538.9 10.8% $10,007.4 9.1%
2006 8,253.5 9.5% $10,857.8 8.5%
2007 8,823.0 6.9% $11,705.9 7.8%
2008(P) 9,418.0 6.7% $12,573.5 7.4%
(P) Preliminary
Source: Beverage Marketing Corporation
PNWS-AWWA 2008 Annual Conference
Consumption Trends
U.S. vs. International Consumption:#1 in total volume consumed#9 in per capita consumption
GLOBAL BOTTLED WATER MARKET
Per Capita Consumption by Leading Countries
2002 – 2007
2007 Gallons Per Capita
Rank Countries 2002 2007
1 United Arab Emirates 35.2 68.6
2 Mexico 37.7 54.1
3 Italy 44.2 53.3
4 Belgium-Luxembourg 32.7 39.5
5 France 37.1 35.8
6 Germany 27.8 33.3
7 Spain 29.7 31.7
8 Lebanon 24.9 29.3
9 United States 20.1 29.3
10 Hungary 13.5 28.5
PNWS-AWWA 2008 Annual Conference
Consumer Choices
Phone survey of Washington residents–Conducted April 2007 as part
of DOH Tap Water campaign Key points:
–55% prefer tap water–45% prefer bottled water–More likely to prefer tap:
Males, people over 35, and households without children
–More likely to prefer bottled: Females, people under 35, and households with children
PNWS-AWWA 2008 Annual Conference
Why choose bottled or tap?
0%
5%
10%
15%
20%
25%
30%
Bottled water Tap water
Tastes better
Clean
Doesn't havechlorine or fluoride
Good (general)
Convenient
Cheap
I have a filter
PNWS-AWWA 2008 Annual Conference
Advantages of Bottled
0%
5%
10%
15%
20%
25%
30%
Portable
Cleaner/purer
Tastes better
Convenient
No advantage
PNWS-AWWA 2008 Annual Conference
Advantages of Tap
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Low cost
Convenient
Available
Has fluoride
Better taste
Less waste
No advantage
PNWS-AWWA 2008 Annual Conference
Which Do You Trust More?
Bottled water52%
Tap water31%
Both equally
17%
PNWS-AWWA 2008 Annual Conference
Consumer Choices
Natural Resource Defense Council (NRDC) (from AWWA, 1993):–Why People Drink Bottled Water
PNWS-AWWA 2008 Annual Conference
Consumer Choices
International Bottled Water Association (IBWA) reasons:–Convenient choice. –Alternative for people living
in the developing world.–Consistently safe, quality,
good taste and convenience. –An alternative to other
bottled beverages that are high in calories and sugar content.
–Most people drink both bottled and tap water and it is not an issue of one vs. the other.
PNWS-AWWA 2008 Annual Conference
Consumer Choices
Three trends emerging in the industry:–North Americans have started to buy
cheaper bottled water such as those sold by Coke and Pepsi (Dasani and Aquafina)
–Many top producers are starting to create nutrient-enriched waters in the hopes to create a new growth frontier for the industry.
–The most widespread industry trend is flavored bottled water.
(Beverage Marketing Corp)
PNWS-AWWA 2008 Annual Conference
Major Suppliers
Leading Global Suppliers:–Nestlé –Danone–Coca-Cola –PepsiCo
PNWS-AWWA 2008 Annual Conference
Major Suppliers
Popular Bottled Water in the U.S. (no particular order):
1. Fiji Water – Paramount Citrus product
2. Poland Springs – Nestlé product
3. Evian – Danone product
4. Aquafina – PepsiCo product
5. Dasani – Coke product
PNWS-AWWA 2008 Annual Conference
Marketing Approaches
Overview: “There's no question about it: Fiji is far away. But when it comes to drinking water, "remote" happens to be very, very good. Look at it this way. FIJI Water is drawn from an artesian aquifer, located at the very edge of a primitive rainforest, hundreds of miles away from the nearest continent. That very distance is part of what makes us so much more pure and so much healthier than other bottled waters.”
PNWS-AWWA 2008 Annual Conference
Marketing Approaches
Marketing Slogans/Strategies: “Untouched by man” Soft smooth taste that is healthy for you;
infused with calcium and magnesium, fluoride, silica, pH and bicarbonate
Plan to be Carbon Negative in 2008 Reducing the amount of packaging used
by 20% over 3 years “Far from pollution. Far from acid rain.
Far from industrial waste.” Working with Conservation International
to protect the Fiji rainforest
PNWS-AWWA 2008 Annual Conference
Marketing Approaches
Overview: Poland Springs Natural Spring Water started as a world-renowned spa in Main in the 19th century. It started bottling its water in 1845.
Marketing Slogans/Strategies: –“Just may be the best tasting
water on earth”–“Sweetness is overrated – keep
your kids healthy and hydrated.”–No fat, no calories, no
cholesterol–Sip smarter, live longer
PNWS-AWWA 2008 Annual Conference
Marketing Approaches
Claims made: Water comes from ancient aquifers
created by a retreating glacier 20,000 years ago
Continuously fed by water from rainfall and melting snow the water percolates through layers of fine sand and gravel to produce spring water with a clean, crisp, refreshing taste
Screened for 200 possible contaminators, which is more than the FDA and state regulations
PNWS-AWWA 2008 Annual Conference
Marketing Approaches
Claims made: “Each drop of Evian Natural Spring
Water starts off as rain and snow high up in the pristine peaks of the French Alps, traveling through a vast mineral aquifer deep within the mountains before emerging at last at the spring in Evian-les-Bains. This amazing journey is the secret to Evian’s purity and takes over 15 years.”
“When you drink Evian, you drink what the Alps has given it.”
PNWS-AWWA 2008 Annual Conference
Marketing Approaches
Marketing Slogans/Strategies:
“Untouched by man perfect by nature”
Limited edition bottles are available to “dress up your table”.
Other terms used: luxury, pure, balanced, miracle of nature.
PNWS-AWWA 2008 Annual Conference
Marketing Approaches
Overview: Aquafina water comes from public water sources and then goes through a state-of–the-art HydRO-7 step purifying process.
Marketing Slogans/Strategies: “Pure Water, Perfect Taste” Aquafina Alive is a nutrient enhanced
water beverage–“Water brings things to life,
including you” Produced in 40 locations so that water
does not need to be transported long distances
PNWS-AWWA 2008 Annual Conference
Marketing Approaches
International Bottled Water Association (IBWA) Ads:
PNWS-AWWA 2008 Annual Conference
Marketing Approaches
International Bottled Water Association (IBWA) Ads:
PNWS-AWWA 2008 Annual Conference
Marketing Approaches
International Bottled Water Association (IBWA) Ads:
PNWS-AWWA 2008 Annual Conference
Marketing Summary
The bottled water companies listed above don’t make any direct claims toward tap water.
They indicate that their water has consistently good taste and high water quality.
Bottled water is made to be seen as an exotic and healthy alternative to tap water.
Bottled water is marketed for its convenience and lifestyle. It is associated with fit, healthy and attractive individuals (i.e. models and MLB players)
PNWS-AWWA 2008 Annual Conference
Counter Marketing
Counter marketing claims–Mostly driven by cost and the environment
Bottled water can cost more gallon for gallon than gasoline, and 1,000 times more than tap water.
2.7 million tons of plastic were used to bottle water as of 2005 (Bottled Water: Pouring Resources Down the Drain - http://www.earth-policy.org/Updates/2006/Update51.htm)
In the US alone more than 1.5 million barrels of oil are consumed in making the bottles. (http://www.sierraclub.org/committees/cac/water/bottled_water/)
PNWS-AWWA 2008 Annual Conference
Regulations and Standards
Bottled water is regulated by the Food and Drug Administration (FDA) as a food product– Interstate commerce only (30-40% of
U.S. sold bottled water)– States can regulate local production
40 states do Washington State adopted federal language
– Reportedly low staff levels for inspection and enforcement at federal and state levels Low priority, lack of resources lead to
infrequent inspections
Tap water regulated by EPA or states with primacy– Washington State DOH has primacy
PNWS-AWWA 2008 Annual Conference
Federal Regulations and Standards
Bottled Water specifics:– Subject to Good
Manufacturing, Quality, and Labeling standards
– Weekly coliform testing, annual chemical testing – results only public if inspected by FDA
– FDA very similar to EPA for IOCs, VOCs, SVOCs, and SOCs
– More stringent on lead (15 ppb vs. 5 ppb)
– Can have coliform up to a limit
– Can sell water that fails coliform and chemical tests, if labeled as such (who would buy this?)
– No mechanism for international plant inspections
Tap Water specifics:– Extensive coliform
testing, quarterly chemical testing
– More stringent on bacteriological testing
– Subject to “Right to Know” annual reports
– Source water protection required
– Standards include phthalates
– Required to test for Crypto and Giardia
PNWS-AWWA 2008 Annual Conference
State and Industry Regulations and Standards
State of Washington:–Both bottled and tap regulated by
the Department of Health–Bottled regulation matches
federal rules International Bottled Water
Association–Voluntary membership that
covers approximately 80% of U.S. supply
–Standards generally as strict or more strict than FDA and EPA regulations, but no real enforcement mechanism
–Annual third party inspection for members, reporting of results unclear
PNWS-AWWA 2008 Annual Conference
Water Quality Studies
National Resources Defense Council (NRDC) Study, March 1999
Tested 1,000 bottles from 103 brands. Tested against Federal, State (strict California), and
Industry standards Found 22% violated CA standards, mostly for arsenic and
synthetic organic compounds 17% exceeded industry guidelines for heterotrophic plate
counts (HPC) – FDA does not consider heterotrophic bacteria to be of public health significance
4% exceeded federal standards for fluoride or excessive coliform, but passed when the same brand was retested
1 sample exceeded the tap water standard for phthalates (no bottled water standard)
PNWS-AWWA 2008 Annual Conference
Water Quality Studies
Case Western Reserve University– Compared 57 bottles to
Cleveland tap water 39 bottles purer than tap 15 significantly higher bacteria All safe to drink
Kansas Department of Health and the Environment– Tested 80 bottled water
samples All had detectable levels of various
regulated constituents 46 had phthalates, 12 exceeding
federal safety levels
PNWS-AWWA 2008 Annual Conference
Plastic Packaging
What is PET?– Polyethylene terephthalate
Petroleum product– 30% of world’s supply of
this compound goes to bottles
– 60% to clothes Relatively easily recycled
– PET denoted by the #1 recycling symbol
– Consumer Recycling Institute says 86% end up as litter or in landfills
2.7 tons (world), 1.5 millions barrels of oil (U.S.)
PNWS-AWWA 2008 Annual Conference
Plastic Packaging
Phthalates–Family of plasticizer chemicals–Used in production of a wide variety of consumer
products–EPA standard of 6 ppb; no FDA standard–DEHP is one of the most common – used in PVC
manufacturingLow water solubilityPossible carcinogen and endocrine disruptor
–Amount of possible leaching, and effects are unclearNRDC study did not find major incidence of DEHP in bottled water.
Leaching from the bottle or present in the source?
PNWS-AWWA 2008 Annual Conference
Plastic Packaging
Bisphenol A– Endocrine disruptor – Can leach from
polycarbonate containers, including water coolers and outdoor bottles.
– Most concern about polycarbonate baby bottles, baby food containers
Canada recently announced plans to ban it for baby-related products
Nalgene announced April 19 that they will phase out bottles containing Bisphenol A over the next several months
PNWS-AWWA 2008 Annual Conference
Plastic Packaging
Urban Legends? E-mails about risks from heating/freezing
bottles–Freezing may actually slow leaching down,
although unlikely to be a big impact either way
–Heating less certain, still under debate The greater actual risk:
–Bacteria growth in open/reusable bottles, particularly “single-use” bottles, since they tend to have irregular surfaces that are difficult to clean.
PNWS-AWWA 2008 Annual Conference
Implications for Municipal Water Purveyors
Bottled water and tap water are both generally of high quality Important that the public value tap water
– Play the PR game – resist implications that tap water is inferior or unsafe
Be aware of and address as possible the “consumer choice” factors
Talking points:– Cost of water, environmental factors,
energy/material/transportation efficiency, good quality, sustainability(!)
Consider selling/distributing bottles or stickers with Utility/District name – market as a local source of pride
Make use of available resources – see links
PNWS-AWWA 2008 Annual Conference
Implications for Municipal Water Purveyors
Seattle Times, March 13, 2008:
To cut down on trash and help the environment, the city of Seattle will stop buying bottled water, Mayor Greg Nickels announced Thursday (March 13).
The city could save as much as $58,000 a year, officials said, by not purchasing bottled water for events or water-cooler jugs for its workers.
"It is to really highlight the fact that Seattle has one of the best municipal water supplies in the country," said Marty McOmber, the mayor's spokesman. "When you look at the cost of bottled water, both in terms of financial costs and costs on the environment, it's a pretty clear choice that using city water is a much better choice."
PNWS-AWWA 2008 Annual Conference
Personal Use Tips
Don’t reuse single-use bottles – hard to wash Do use bottles designed to be reused, and
wash regularly to avoid bacteria growth (non-polycarbonate plastic, stainless steel, other)
Leaving open/reusable water bottles in a hot car or other warm place encourages bacteria growth – avoid that
If you don’t care for the taste of your local water, try a filter
LinksFor more information:FDA: www.fda.govEPA: www.epa.govIBWA: www.bottledwater.orgNRDC: www.nrdc.orgAWWA: www.drinktap.orgTake Back the Tap:
http://www.foodandwaterwatch.org/water/pubs/reports/take-back-the-tap
Tap into Goodness: http://www.doh.wa.gov/ehp/DW/tapwater.htm