Another highlight of Zenith’s Global Bottled Water Congress in Budapest earlier in October was a presentation by Andy Peykoff Sr, Founder and Chairman of Niagara Bottling in the United States.
Niagara has achieved extraordinary momentum through intensive cost management and packaging innovation. Andy Peykoff gave some fascinating examples.
• In 1998 its typical 0.5 litre PET bottle weight was 25g. Today it is 8-11g. A saving of up to 68%.
• Bottle caps now weigh just 0.8-1.0g.
• Today packaging accounts for only 2% of the weight of a bottled water product, compared with 40% for glass and even 13% for an egg.
• Another pioneering move was introducing nested cases, where bottles are packed diagonally rather than in rectangular lines. These are 50% stronger and allow 17% more cases per pallet. This is because the bottles have 6 contact points between each other instead of 4.
At Zenith’s Global Bottled Water Congress in Budapest earlier in October, the Chairman and Chief Executive Officer of global market leader Nestlé Waters, Marco Settembri, made some dramatic statements.
He asked: “Can we in bottled water make a difference in public health?” And he answered: “I believe we can. People are not drinking enough water and are consuming too many calories from sugar-sweetened beverages, the usefulness of which is questioned by science”.
He showed a video illustrating the behaviour of 13,000 students in the United States when faced with a choice between two vending machines next to each other. One contained sugar-sweetened beverages, the other bottled water. An out of order sign was put on the bottled water machine. What happened? Did everyone walk away to find tap water? In fact, 63% chose a sugar-sweetened beverage instead.
He underlined that bottled water and tap water complement each other in increasing water consumption and urged the bottled water industry to promote the pleasure of drinking water.
I’ve written several blogs about Monster energy drink catching up with and overtaking Red Bull in the United States.
Now it’s happening in Spain as well. The latest figures from the September edition of Alimarket show:
• Monster volume up 56% to 25 million litres in 2013, compared with Red Bull down 6% to 30 million litres.
• Monster retail volume up 7.5 share points to 21.0% in the year to 30 March 2014, compared with Red Bull down 2.1 share points to 20.3%.
Where next, I wonder ?
Of the top 100 food, drink and other grocery brands in Britain, soft drinks are leading the way, according to analysis of Facebook and Twitter engagement in The Grocer magazine earlier this month.
• 4 soft drinks were in the top 10 : Irn-Bru at 1, Volvic at 2, Pepsi at 5 and Capri-Sun at 10.
• 5 more were in the top 50 : Robinsons at 22, Fanta at 27, Ribena at 37, Innocent at 39 and Evian at 40.
Dairy had 8 entries and hot drinks 4.
Alcohol and some other categories were excluded.
September was a record month for food and drink sector transactions, with 62 listed on the bevblog.net database including 19 in the first 4 days alone.
8 involved sums over $500 million and 3 of these more than $1,000 million:
• $4,600 million sales from the proposed new terms of merger between fruit businesses Chiquita of the United States and Fyffes of Ireland
• $1,400 million for Japan’s Mitsubishi to buy Norwegian fish producer Cermaq
• $1,225 million for US Crown Holdings to purchase Heineken’s Empaque packaging operations in Mexico.
Among the 62 total, 11 were in soft drinks, 9 in dairy, 8 in alcohol, 6 in packaging, 4 in ingredients and 4 in nutrition.
30 were international and 32 within national borders, 24 of these solely in the United States.
28 countries featured overall, with 36 involving the United States, 6 the United Kingdom, 5 Japan, 4 Brazil and 4 Ireland.
It should also be noted that August’s largest prospective deal relating to Treasury Wine Estates of Australia will not now proceed.
PET has transformed the bottled water and carbonated soft drinks markets. It has had less success with beer, fruit drinks and milk.
Now Sidel has come up with a real contender for beer. Its new bottle:
• has a smooth round base like glass
• can take a crown cap like other beer bottles
• saves up to 86% of the weight of glass
• withstands flash and tunnel pasteurisation
• offers a six month shelf life
• and, of course, it’s clear, doesn’t shatter and so on.
At the moment, although 5 billion bottles of beer are sold in PET each year, this represents only 2% of total consumption. It’s not hard to imagine this figure rising substantially in the coming years.
It had been growing by 4% a year, then slumped in 2008/09 and swiftly returned to 4% growth in 2010. Since then it has hovered at around 3%, but now seems to be heading towards just 2%.
All this is captured in the most insightful single line I have ever seen – The Economist magazine’s regular chart on overall global economic growth.
The commentary on 13th September highlighted that:
• Brazil has slipped into recession
• Russia has stalled
• Japan’s new sales tax has depressed consumption
• Euro area growth was a mere 0.7% in the year to June
• China contributed 45% of total global growth.
2.6% is not to be sneezed at, but 4% would be far healthier.
France is regarded by many as the cradle of natural mineral water. Yet spring water has now overtaken mineral water in retail sales volume, according to the latest Scantrack statistics for hypermarkets and supermarkets during the 12 months to June 2014.
Still spring water had a 41.5% share of total water volume, compared with 39.0% for still mineral water. Sparkling waters accounted for 17.6% and flavoured waters the remaining 1.9%.
In value terms, however, still mineral water continues to outsell still spring water by a factor of more than two to one. Still mineral water’s value share was 44.3%, compared with just 20.1% for still spring water. Sparkling waters were a far stronger 29.5% and flavoured waters 6.1%.
All water segments have returned to growth in France, with total volume up 4.1% and value up 2.5%, led by sparkling flavoured water volume up 22.3% and still flavoured water value up 22.5%.
Plus ça change, plus ce n’est pas la même chose.