group 8 fiji_v0.3

Powerpoint Templates Powerpoint Templates

Group 8 – FIJI Water

Alan So Amika GuoMaggie Liu Raymond ChuTony Tung

PMBA 6032

http://www.powerpointstyles.com/


Powerpoint Templates 2

Agenda

Company Overview Bottled Water Industry

Challenges Marketing Strategy CSR Issues CSR Recommendations Implementation Plan



Company

• 1993 founded• US based company,

headquarters in L.A.• Offers purest quality,

silica-rich and of distinct taste water from the island of Fiji

• Main markets: US and Australia

Industry

• Bottled water industry (fastest growing segment of the beverage industry)

• Major manufacturers (Nestle, Coca Cola, PepsiCo, Crystal Geyser)

Company Overview



Negative impact on the environment High carbon emissions related

to its production, storage, transportation and disposal

Bottled water is perceived to be unnecessary expensive

Bottled water is no healthier or safer than tap water

Challenges Faced by the Industry



Positioning 4Ps – Product, Price, Place,

Promotion Global Expansion Strategy

Marketing Strategy



Healthy bottled water Affordable luxury Pure and natural Refinement status, exclusivity

Positioning



From primitive rainforest artesian aquifer

All natural, pure, smooth taste, no aftertaste

Light mineralization High in silica - help strengthen

bones, skin, hair, nails, connective tissue and anti-aging

Unique square bottle

4Ps - Product



Premium price Affordable luxury Position slightly below Perrier

but above Evian

4Ps - Price



Available in high-end hotels, restaurants

Mass merchandisers, convenience stores, drug stores and even gas stations

Exclusive distribution partnership with Cadbury Schweppes in Australia, US & Canada– tens of thousands retail stores

Online in some states

4Ps - Place



Unique and high quality image Very little “formal” or paid

advertising Only advertise in in-flight

magazine Word-of-mouth, free product

placement, target sampling, event marketing

Advocated by popular singers and movie stars like Leonardo DiCaprio, Elton John

Receive publicity by movies, TV series and …

4Ps - Promotion



Election Night 2008Source from(http://www.fijiwater.com/blog/tag/barack-obama/)

Summit of the Americas Source from(http://www.fijiwater.com/blog/tag/barack-obama/)

4Ps - Promotion



Largest consumption market in bottled water

1997 Los Angeles 1998 New York, Canada 2000 Exclusive distribution

agreement with Cadbury Schweppes

2002 2nd place of imported bottled water

2008 1st place of the imported bottled water

Global Expansion - USA



Relatively large market Close to Fiji 2003 Available in selected

hotels & restaurants 2005 National distribution in

Coles supermarkets 2007 National market

distribution agreement with Cadbury Schweppes Australia

Global Expansion - Australia



http://www.youtube.com/watch?v=T-DDeQeNGY4&feature=player_embedded

CSR Challenges Faced by Fiji





Greenwashing vs Every drop is green

An article called “Green or Greenwashing?”comments:Every drop of FIJI Water is transported from thousands of miles away and consumed hundreds of gallons of fuels which is completely unnecessary.



Environmentalist claimed that “carbon negative” message does NOT provide the actual calculation of carbon footprint.

Carbon Negative



U.S. Environmentalist, Greenwash Brigade showed the environment impact of FIJI water with the following numbers: 46 million gallons of fossil

fuel 216 million pounds of

greenhouse gases

Reference: James McMaster and Jan Nowak (2009) FIJI Water and Corporate Social Responsibility – green makeover or “Greenwashing”

Environmental Impact



FIJI Water produced in Fiji was sold to the company’s headquarters in Los Angeles at a very low price US$4/carton.

US$50/carton in the US Fiji Islands Revenue & Customs

Authority (FIRCA) accuse FIJI Water of transfer price manipulations.

Transfer Pricing


Powerpoint Templates 19Source: http://www.travelmath.com

Countries Cities

USA Los Angeles 5,514 8,873New Jersey 7,924 12,753

Miami 7,466 12,016

Canada Vancouver 5,863 9,436Australia Sydney 1,983 3,192

Melbourne 2,417 3,891

UK London 10,118 16,284

China Shanghai 5,048 8,124Beijing 5,620 9,045

Hong Kong 5,128 8,253India Delhi, Indian Capital 7,444 11,980

Mumbai, a mega city 7,578 12,196

Kol Kata 6,667 10,730Chennai 6,997 11,260

Distance (miles)

Distance (km)

Solution 1:Reducing Carbon Footprint by Expanding Other Market Segments:China and India

How to Cope with CSR Challenges?Solution 1



Why India?Shorter carbon

footprint (vs UK)

Most of India’s tap water is

unfit

Over 1,600 Indians died

every day because of waterborne

diseases

The bottled water industry is growing at 40-50% p.a.

No. of Expatriates/

Tourists: 30,000/

4,977,193

Source: About.com: India Travel (by Sharell lCook, About.com Guide)

http://goindia.about.com/od/annoyancesinconveniences/p/indiasanitation.htm

Source; India Reports (by Abhijit Banerjee on Dec 13, 2009) in Sustainable Living in India.

http://india-reports.in/earth-solutions/bottled-water-consumption-in-india/

Source: Inbound Tourism Statistics (2007) http://www.itopc.org/travel-requisite/inbound-tourism-statistics.html




Increase in Tourism (World

Expo 2010)

Shorter Carbon Footprint

(vs UK)

No. of Overseas

Tourists: 55m in 2007

Poor Quality Tap Water

Growing Middle Class

Growing Bottled Water Consumption

by 11%+ to 15.5L per person

Increasing Health

Consciousness

Increasing Consumer Affluence

Why China?

Source: FoodBev.com (12Aug2009)http://www.foodbev.com/article/the-chinese-bottled-water-market

Source: http://en.wikipedia.org/wiki/Tourism_in_China



http://www.foodbev.com/article/the-chinese-bottled-water-market


Exclusive Distributorship Agreement

Hotels and Spa

High-end Restaurants

Pubs

Western Supermarkets

• Foreigners (Expatriates/Tourists)• Local Chinese/Indian Affluent

Customers

Target Customer Segments

Distribution Channels & Target Customers Segments



Carbon Footprint: the “total set of greenhouses gases (GHG) emissions caused by an organization, event or product”, which includes bottling, transportation and distribution of the bottled water.

Source: http://www.fijigreen.com/

Promise: “Carbon Negative” or “Every Drop is Green”

Revised: “Minimize Carbon” or

“More Environmentally Friendly”

Solution 2:Change the Slogan(~ Walmart: Change from “Always the Lowest Price” to “Save Money Live Better”)




How to Minimize Carbon Emissions?4 Proposed Methods

Vending Machines &

“BYOB”

Paper Boxed Water

Use Carbon- Efficient

Transportation Modes e.g.

Ocean Freight or Hybrid Cars

for Inland Transit

Install Container Deposit Machines

and Refund Container

Deposit to the Customer

“Minimize Carbon!”





FIJI GOVERNMENT

Lobby with Fiji government to settle the “transfer pricing” issues, FIJI water is important to Fiji Gov. as: • employ Fijians in their bottling plant• 1st Fiji Export goods• Major Tax income for Fiji

Continue to use FIJI Water Foundation to help local Fijians:• Improvement of Infrastructure facilities• Education Funds• Water purification projects for those remote villages




Improve FIJI’s Brand Image Globally, counteract negative accusations Constantly disclose donations info.

especially on those funding supports for local Fijians / charities

Employ 3rd party to conduct the carbon footprint assessment and join the carbon offset scheme

Launch a “take from natural, return to natural” campaign, $0.5/bottle contribute to water purification projects in other third world countries like Nepal, Kenya, Mongolia…etc.

A soldier palletizes water to be air-dropped in Haiti.

(http://www.fijiwater.com/blog/2010/01/

http://www.fijiwater.com/blog/2010/09/citymeals-on-wheels-charity-donation/#more-3098

While tasting

this, you are

donating $0.5

to help the 3rd

World to have

clean water



FIJI’s Sustainable Growth Strategy FIJI Water’s Profits are susceptible

to: availability of water source Fiji Government Policies Declining of bottle water sales Continuous negative accusations of

those environmentalists or Green Power

Risk diversificationNew product for a

New market



FIJI’s Sustainable Growth Strategy

Add Fiber & Vitamins Improve Health Energetic

Expanding business, step into beauty / health drinks markets: Add Collagens

Anti-aging Good for skin

“FIJI Beauty”



Implementation Plan

Short Term Strategy

Medium Term Strategy

Long Term Strategy

Restore the brand image

“Less Carbon” Slogan (an achievable target!!)

3rd Party Carbon Audit

Improve current relationship with Fiji Government, settle the transfer pricing issue

Contribute to water purification projects in third world countries, “take from natural, return to natural”

Target to those Countries where tap water is in poor quality

Focus on China and India Market

Change customer’s buying behavior (benefit to the whole bottled water industry)

Vending Machine Bring Your Own

Bottle (“BYOB”)

Finding another water sources

Develop new products for new market (Beauty / Health Drinks) Collagen drinks Fiber drinks Vitamin drinks



Thank You!!



Appendix:Fiji’s Current Charity Donations Example:

Fiji Water is currently having a charity donation scheme in the US to improve its CSR.

http://www.fijiwater.com/blog/2010/09/citymeals-on-wheels-charity-donation/From 1Sep2010 through October 31, 2010, for every case of FIJI Water sold in the New York City metro area, we will donate $1 to Citymeals-on-Wheels, a nonprofit providing meals to homebound elderly. In addition to donations per case sold in stores, one meal will also be donated for each case bought via FIJI Water Delivery. All together, FIJI Water will contribute up to $25,000 from your purchases.Big-Time CharityCitymeals has been operating in New York for almost 30 years, and has gained a place in the hearts of New Yorkers as one of the city’s most admirable charities.Citymeals raises private funds to contribute to 30 community-based agencies that bring weekend, holiday, and emergency meals to New Yorkers who can no longer shop or cook for themselves. Last year, 1,500 volunteers helped bring over 2.1 million nutritious meals to 17,713 frail aged in every borough of New York City.


http://www.fijiwater.com/blog/2010/09/citymeals-on-wheels-charity-donation/

http://www.fijiwater.com/blog/2010/09/citymeals-on-wheels-charity-donation/

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