Bottled water emerged as a major beverage industry force not only in the United States—by far the single-largest national market in terms of volume—but also in practically every major geographical region of the world.
Specifically, bottled water first became a sizeable, mainstream commercial beverage category in Western Europe, where consumption of it has long been part of many residents’ daily routine. The establishment of consuming habits creates huge demand on bottled water. In fact it is now a truly global beverage, found even in some of the more remote corners of the globe. Certain Asian markets achieved strong growth to become major bottled water markets during the 2000s.
But the strong growth doesn’t make it much easier for new business to start in this highly competing industry. Much of the world’s bottled water market is still highly fragmented and controlled by local brands, but consolidation is rapidly occurring, as four companies have come to dominate much of the market. The report from beverage Marketing Corporation, a New York-based research, consulting, and financial services firm shows that Swiss food and beverage giant Nestlé and France’s Danone are the traditional leaders of the bottled water pack. Both companies centered their operations around the core markets of Western Europe and the United States.
However, as water growth is increasingly coming from the developing world, Nestlé and Danone have taken their battle to the new competitive fields of Asia, Latin America, and other areas. In fact, Danone stepped back from the U.S. market to focus on some of those other markets. Soft drink industry leaders Coca-Cola and PepsiCo also joined the global bottled water race. Following their strong showings in the United States, both companies increasingly devoted resources and energy to developing their global bottled water businesses.
While the big companies enjoys lower cost from scale, investors of new business should firstly recognise the value of their own products and then differentiate them with common one on the market. The design of bottle and even advertisement could be the decisive point.
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