Water. There’s nothing simpler or purer in this world. But if you think it’s a simple product to market… well, you haven’t talked to the folks at Watertowne Bottling.
Founded four years ago in Airdrie, Alta., Watertowne delivers purified water to both residential and corporate customers, through a network of franchisees in the Western provinces and Ontario. The company racked up gross sales of $2 million last year – 90% of which came from sales of five-gallon bottles. (Sales of small, single-use bottles accounted for the other 10%.)
As a small player vying for share with such well-established competitors as The Perrier Group, Culligan, Cool Springs, Canadian Springs, Sierra Bottled Water and Cedar Springs, Watertowne faces considerable challenges in its effort to establish a brand reputation and build customer loyalty.
That certainly accounts for the company’s aggressive marketing stance. Under the direction of founder and president Roy Lewis, Watertowne has adopted a strategy of brand-building through social and grassroots activities at the local community level. In addition, the company is planning expansion of its product line and a foray into e-commerce – efforts that are expected to help bring about significant growth of the customer base.
Lewis established the operation in 1996 as The Original Water Club. There are currently 14 franchisees in Alberta, along with three in B.C., five in Ontario and one in Saskatchewan.
The head office in Airdrie looks after many of the administrative duties, such as taking customer orders, centralizing the accounting and billing, and providing marketing support. That leaves the franchisees clear to focus on delivering product and building relationships with new customers.
‘The franchise community is really the product,’ Lewis says.
Last year, in an effort to strengthen its position in the marketplace, the company changed its name to Watertowne and embarked on a major rebranding process, with assistance from Sarasota, Fla.-based agency The Better Image Company.
In creating a new brand identity for itself, Watertowne has played up ‘old-fashioned’ values such as customer care and community involvement, cultivating a kind of neighbourly attentiveness meant to evoke sepia-toned images of the friendly local merchant of yesteryear.
‘Watertowne deals in nostalgia – in simplicity and trust,’ Lewis says. That’s reflected in all aspects of the new visual identity the company has been introducing over the course of the last year – from the ‘turn-of-the-century’ look of its brochures and other collateral materials, to the retro milkman’s-style uniform that all Watertowne delivery people will eventually wear. (While The Better Image Company was responsible for the conceptual side of the rebranding process, Response Generators of London, Ont. has handled the execution.)
Visual presentation, however, is only a part of Watertowne’s brand-building strategy. The real key, according to Lewis, is the personal approach taken by individual franchisees, who are typically owner-operators living in the communities that they serve.
Lewis encourages franchisees to partner with local or regional associations and charities. This, he explains, helps to build deeper relationships with the community, sparks referral business and may even open up database marketing opportunities.
In October, for example, Watertowne took part in a United Way fundraiser in London, Ont., providing water for participants and distributing flyers soliciting business. A percentage of any sales that result will be earmarked for the United Way. The company also supplies water for amateur tournaments organized by the Canadian Hockey Association.
In addition, Watertowne is part of the ‘Show Your Card & Save’ affinity program offered by the Alberta Motor Association (AMA), a chapter of the Canadian Automobile Association. The program offers AMA members the chance to get discounts on the products and services of participating companies. (Ardis Westgard, program manager with the AMA, says the Watertowne discount on cooler rental and bottled water is, on its own, enough to cover the cost of the association’s annual $51 membership renewal fee.)
Lewis says participation in the program gives Watertowne the opportunity to tap some 570,000 names on the AMA membership list. The association has, for example, distributed a number of mailers on the company’s behalf. And Watertowne also enjoys the right to use the AMA logo on promotional materials, the company Web site, and the vans and uniforms of delivery people.
‘AMA member demographics are similar to those of a Watertowne customer,’ Lewis says. ‘The program has done very well for us in increasing our customer base.’ As Watertowne’s franchisee network expands, he adds, the company would like to involve itself with other CAA chapters in similar fashion.
A relaunch of the corporate Web site (www.watertowne.com) is one of the next major moves on the agenda. The new site, which will echo the ‘1900s’ look of Watertowne’s print materials, is scheduled to be up and running next spring. Principal among its features will be an e-commerce function, allowing customers to order online. There are also plans to create a kind of virtual main street on the site, with storefronts occupied by a variety of partner companies. (Businesses that want to set up shop on the Watertowne site will fork over a tenancy fee, along with a percentage of online sales.)
The company is also planning to expand its line of Watertowne-branded products. The newest addition: Watertowne Roasters Coffee. To gather information about customer coffee preferences, franchisees will be distributing questionnaires when they make deliveries. Respondents will receive a sample pack of the coffee, packaged by Calgary-based Planet Coffee.
If Watertowne’s plans to broaden the product range prove successful, Lewis says, the company’s core offering – the five-gallon bottle of water – could eventually come to represent less than 50% of revenues.
There are still many areas of opportunity that Watertowne has yet to tap, notes Peter Watson, president of Response Generators. The Ontario market, in particular, holds great potential.
In the wake of last summer’s Walkerton, Ont. tragedy, he notes, more than 130 Ontario locales have been identified as ‘hot spots’ where water quality may be questionable. ‘You can be sure the franchisees will be using that information.’
Also in this report:
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– Railtour lures ’em aboard with luxury: Limited budget? Lots of competition? Go niche, young man p.27
