Bottled Water Remains A Strong Performing Sector In Asia

Friday, March 23rd, 2018 | 1104 Views

While China remains one of the biggest bottled water markets globally, retail volume sales have been dipping, according to market intelligence company Mintel.

In 2017, China’s bottled water market was forecast to reach sales volume of 27 billion litres, up from 25 billion litres in 2015. However, sales volume growth has went down from five percent in 2015 to 4.2 percent in 2017, and is predicted to fall further to 2.8 percent by 2021.

In what is the world’s most populous country, the expansion of bottled water has been relatively fast, with per capita consumption rocketing from just five litres in 2007 to 20 litres in 2017. This is relatively low compared to more developed markets like Mexico (222 litres per capita) and the US (120 litres per capita).

“Due to trends in premiumisation, China’s bottled water industry has seen rapid growth over the past decade. Despite a saturated market, innovation opportunities still exist, and premiumisation remains key for value market growth,” said Loris Li, associate director, food and drink, Mintel.

Due, in part, to more premium options, the research shows that 50 percent of Chinese consumers aged 20-49 drank unflavoured sparkling water in 2016, up from 29 percent in 2015. Furthermore, three in five (60 percent) drank flavoured sparkling water in 2016, an impressive increase from 30 percent in 2015.

Bottled water remains one of the strongest performing sectors of the global non-alcoholic drinks market, with retail sales volume in key global markets climbing by 6.5 percent between 2016 and 2017 to reach an estimated 203 billion litres. The US is currently the largest bottled water market, with volumes forecast to reach 39 billion litres in 2017. The US is followed by Mexico (28.7 billion litres), China (27 billion litres), Indonesia (16 billion litres), and finally Germany (12 billion litres)—rounding out the list of top five bottled water markets globally.

India’s bottled water sector outpaced growth of any of the other major global markets between 2016 and 2017, recording an impressive 19 percent growth. Also among the top five fastest growing bottled water markets are Indonesia (13.2 percent), Vietnam (11 percent), the Philippines (10.6 percent), and finally South Korea (9.9 percent).

“Recognising that India’s population is among the largest in the world, it remains a sleeping giant in the global market. However, India’s bottled water retail sales have climbed significantly in the last year. This growth is being driven by rising incomes, consumer concerns over hygiene, and convenience needs, particularly when out of home,” commented Alex Beckett, associate director, food and drink, at Mintel.

When it comes to concerns about sugar in beverages, carbonated soft drinks’ loss is bottled water’s gain. The research reveals that 25 percent of Americans claim to be drinking more water. Among this group, 76 percent say they are drinking fewer carbonated soft drinks, and 70 percent said they are increasing their water intake to reduce their sugar intake. In the UK, as many as 48 percent of bottled water drinkers have switched to bottled water from other drinks.

There has been an increase in the number and share of flavoured water launches bearing a low/no/reduced sugar claim in 2017. Of all the flavoured waters launched globally in 2017, those bearing the claim accounted for 32 percent of launches, up from 23 percent in 2016.

“The growth that the global water market is experiencing reflects consumers’ preference for less sugary drinks, lively levels of innovation, and uncertainty about the safety of domestic water supplies. Growth is also benefiting from an increased willingness among consumers in certain markets to pay for premium bottled water,” concluded Mr Beckett.