Bottled Water Is Getting Pricier & More Premium
NATIONAL REPORT — Soda companies are adding low-calorie, nutritious beverage options to their portfolios as Americans cut down on their soda consumption. As a result, bottled water should be big news this year, according to a Business Insider report.
Water sales have been on the rise for some time now. In 2014, major water brands such as Nestlé's Poland Spring, Coca-Cola's Dasani and PepsiCo's Aquafina saw volume growth ranging from 7 percent to 9 percent, while Coke and Pepsi volumes both dropped nearly 3 percent.
Nutritionally speaking, water benefits from a healthier reputation than soda in a time when sugar-related concerns made negative headlines in 2015, according to the report.
"We've had some substantial investments in [research and development] that have allowed us to put out more new products," PepsiCo Americas Beverages CEO Al Carey stated at the Beverage Digest Future Smarts conference. "Not all of it is skewed toward healthy, but very much healthy and very much single-serve. And what that's done for us is allowed us to change the mix of its portfolio."
In 2016, PepsiCo will debut new sparkling Aquafina flavored waters, while The Coca-Cola Co. will continue to roll out sparkling Smartwater, along with other healthy beverages such as organic Gatorade, new ZICO coconut water flavors and sparkling Minute Maid juices. Not only do these products create a more diverse lineup, they also increase profit margins, which are typically lower for plain bottled water.
There is room for the soda titans to grow in the $13-billion bottled water business. Coca-Cola and PepsiCo currently have 13-percent volume share in the United States, far behind segment leader Nestlé. Accordingly, competition is likely to heat up as companies expand their offerings to include a variety of healthier alternatives.