H2O brands boost marketing

Coke and Pepsi have recently flooded an already burgeoning Canadian bottled water industry with accelerated ad campaigns,
a move that will likely impact brands in a category that hasn't seen much activity on the marketing front traditionally.

Coke and Pepsi have recently flooded an already burgeoning Canadian bottled water industry with accelerated ad campaigns,

a move that will likely impact brands in a category that hasn’t seen much activity on the marketing front traditionally.

‘This is not an industry that has spent a lot on marketing, so the fact that Pepsi and Coke are devoting a lot of money to it, is an incentive to the industry overall,’ says Kathleen Ransom, a consultant with Hidell-Eyster International in Hingham, Mass., which analyzes the North American bottled H2O market.

Coke began running ads for its Dasani brand this summer, joining Pepsi and upping the stakes in what was previously a fairly still market. Pepsi certainly viewed a lack of aggressive marketing as an opportunity for its Aquafina label, according to John Grant, its Mississauga, Ont-based director of marketing, portfolio brands.

‘The canvas was fairly clear, there wasn’t a lot of advertising in the category, and we felt that there was a position there that we could really own,’ he says, adding that, ‘in the beverage market, you need to develop a strong brand connection with your consumer group, and establish brand equity with those emotional links.’

That’s what the soft drink manufacturer set out to do when it began pushing Aquafina just a year ago, after it strengthened its distribution chain. The product is in ‘as many places as possible,’ not just grocery stores, but convenience shops, hockey arenas and gas stations, points out Grant. Last summer Pepsi debuted its first advertising stints using radio and transit, and this year, it followed with another set.

‘We tried to get across a very approachable, friendly and humourous brand character,’ says Grant. ‘Because consumption of water is so broad, we just wanted to have a common chord we thought would connect with an array of consumers.’

In one of the transit ads, a woman looks desperately for something. You see her in the background, while in the foreground, a large sunflower hides a bottle of Aquafina with its leaf. In a similar vein, a radio spot begins with an older woman storytelling, while running a bath faucet. The voiceover says, ‘This is the water you put your naked butt into. The good stuff we put in bottles called Aquafina.’

In the case of Coke, the goal was also to secure the fundamentals of business before it started to speak to consumers this May. ‘If you don’t [do that], you could wind up communicating a category benefit, but at the expense of your own brand, because the consumer will turn around only to buy a competitor’s product,’ explains Chris Johnston, group brand manager, non-carbonated beverages and innovation for Toronto-based Coca-Cola Canada, who agrees with the need for a more expressive campaign.

‘The challenge [of marketing water] becomes resolved where you try to actually break the brand proposition along personality lines. It’s not unlike the vodka category, [where] your choice is very much predicated on the different personalities the brands have [because it tastes essentially the same].’

Dasani was finally ready to broadcast its message this summer when its out-of-home strategy launched with three installments that popped up in Ontario, Quebec and Western Canada. One execution describes the brand as ‘what happens when clean freaks decide to bottle water,’ while a second claims it ‘takes the earth 14,000 years to filter water. We thought we’d save you the time.’

Johnston says the overall attributes are urban, active and fun. ‘You can see it in the execution and also the product. The label is dark blue and has an urban, Italian feel. In the advertising, we used blue backlit on black. We used black to communicate sophistication.’

Certainly, both Pepsi and Coke have capitalized on opportunities for growth in this industry. According to numbers from Hidell-Eyster, since introducing Aquafina in 1994, Pepsi saw sales increase twelvefold, from US$23 million in 1996 to US$259 million in 1999, while Coke’s Dasani reached sales of US$75 million in 1999, its first year alone.

In Canada, ACNielsen reports that in the 52 weeks to September 2000, about 232-million litres of flat water were purchased, compared to 186 million in the same period in September 1999. It’s a trend that won’t be dampened any time soon, as indicated by the arrival of both beverage companies into the marketplace, suggests Elizabeth Griswold, spokesperson for the Canadian Bottled Water Association, which monitors quality for some brands.

‘The industry is growing, on average, about 10% across the country for all types of bottled water,’ she says. ‘You wouldn’t think that a large corporation would get involved if there wasn’t serious potential for them.’

And while tainted water has become an all-too-common Canadian resource lately, scandals like those in Walkerton, Ont. and North Battleford, Sask. will help create a surge, according to Ransom.

‘What’s driving consumption is… that consumers want safe, affordable drinking water. There’s a certain element of mistrust,’ she says. ‘And also consumers are turning [to bottled water] as a healthy alternative.’

At least one other manufacturer has also followed Pepsi’s lead with a fresh, personality-based strategy of its own. Evian, a label owned by Danone Waters of North America and one of the first on the market, hopes to reconnect with its original upper-class customer, according to Susan Whyte, director of marketing, who stresses its sponsorship of high culture events like the Toronto International Film Festival and the Rogers AT&T Tennis Open. ‘To be seen at high-profile events is excellent for the brand, because [it reaches] people of influence.’

At the 2001 Toronto film festival, Evian unveiled its Nomad packaging in Canada, which originally swamped U.S. stores last spring. The product is a regular, single-serve bottle, but its cap is formed into a hoop that can hook onto backpacks or be carried easily. While Whyte admits there will be marketing involved, a plan has yet to be finalized. ‘It will revolve around the on-the-go aspect of the water and [the fact] that it’s easy to take with you.’

This summer, Evian also introduced ‘Jetiquette,’ its first ever Web promotion, which, until Sept. 15, gave consumers a chance to win the use of a private jet to travel anywhere in the world, plus US$10,000 in cash.

To enter, participants had to go to www.evian.com, and enter an eight-digit code found on the side of specially marked labels. Once they keyed in their names and addresses, they were entered into the grand prize draw. They could also collect points each time they added a new code, giving them access to other freebies, like tees, handbags and watches.

According to Whyte, the database will enable Evian to communicate one-on-one with members going forward, although she wouldn’t elaborate. Meanwhile, Jetiquette postcards, featuring glam, animated hipsters, were used to promote the contest.

Similarly, Montclair, a brand of the Perrier Group of Canada, organized a draw to win a trip to Cuba this summer, which it advertised on TV, in print and through store displays.

In its three years of marketing, the brand message has zeroed in on the fact that Montclair offers natural spring water, says Gustav Quast, general manager. ‘That in itself is a differentiator because it isn’t a treated or reversal osmosis type of water [like others].’

But Ransom says this claim, used by several players in the category, is a weak one in the face of both Coke’s and Pepsi’s recent personality-based push.

‘You have two giant advertisers and it’s a concern to the bottled water industry because many of the leading brands had focused their product on natural spring water,’ she says. ‘They’re finding that that marketing hypothesis is not holding up to these other products as well as they had hoped.’