Luxury Wine and Water Trends – Jessica Altieri – Beverage Expert
PREMIUM WATER: IMMERSE YOURSELF IN THE OPPORTUNITIES
By Jessica Altieri, Internationally Certified Water Sommelier
The market for bottled water remains impressively strong, but the real action—and opportunity—is now found in the category of premium waters.
Reports from Business Insider, Euromonitor International, Beverage Daily, and a host of others indicate that significant profit-potential exists in the premium bottled-water segment.
In April 2019, I delivered a presentation explaining why affluent and non-affluent consumers alike are increasingly clamoring for premium bottled water. The following information reiterates and enlarges upon the points I made, and suggests ways that you can successfully leverage the demand for this luxury product.
WHAT IS ‘PREMIUM’ WATER?
Basically, bottled water qualifies as premium if it possesses one or more exceptional qualities—actual or perceived—that set it apart from mainstream products and justify a price far exceeding the market average.
One defining characteristic of premium water is provenance. Water sourced from an exotic or far-off-the-beaten-path location (such as a spring atop a towering mountain or a wall of ice on the face of a ruthlessly difficult-to-access glacier) will allow it to be classified as premium. This is particularly true when the geologic composition of the source naturally infuses the water with a distinctive mineral content that contributes exceptional flavor, function, higher-level purity, or some combination of these.
Source can also help endow water with a compelling image—essential for convincing consumers that the product is worth the high dollar-amount printed on its tag. However, a suitably posh image can be created not only by provenance but by placement: stocking a particular brand of bottled water exclusively in upscale shops and restaurants can cause it to be associated with a luxury lifestyle or luxury experience. Similarly, a suitable image can be fashioned by marketing campaigns and social-media outreach that tell a unique, fascinating backstory about the product.
PREMIUM WATER BY THE NUMBERS
Beverage Daily reports that $16.5 billion worth of premium bottled water was sold worldwide in 2017 (the most recent year for which figures were available). That sum represents a 48-percent gain since 2012.
It’s not simply that the wealthy consumers who all along have bought premium water are now drinking more of it. It’s that consumers lower down the economic scale also are purchasing the product and increasing their consumption. Indeed, premium-water consumption between 2012 and 2017 grew 26 percent, In 2017 alone, consumers drank nearly 3-billion gallons of it.
Seventy-two percent of the world’s premium water market is situated in Western Europe. But it’s in North America where the greatest growth can be observed–13 percent per year. By comparison, Europe grows at just 3 percent (the Middle East and Asia each grow at 6 percent).
As to pricing, consumers pay a global average of 150 percent more for a bottle of premium water than they do for one not labeled as such. However, in markets where consumers most enthusiastically prize premium water, the price of a bottle averages 800 percent more than that of non-premium water.
Clearly there are opportunities in the premium wine and bottled-water category. To take advantage of those opportunities, you should begin mapping out an appropriate game plan.
My recommendation is to start by reviewing your existing water programs.
Look for aspects of those programs that would support the introduction of premium waters. If you can find none, then create a luxury water program from scratch.
In any event, support your introduction by developing a program to educate consumers about the premium waters you offer. The more they know about their choices, the more inclined they will be to say yes when asked if they would like to experience one of your very expensive bottles.
Include in your education program an inward-facing element to train your staff. You will want them equipped to ask of consumers the right questions the right way in order to encourage sales.
Also, if you plan to conduct a premium-water program in the context of a fine-dining establishment, you may find it advantageous to make single-glass servings and bottles of premium waters available with existing wine pairings.
The goal is to make premium water your new beverage channel for generating more revenue in 2019. I am confident you will find that premium water is like a rushing, rising river in that it is unstoppable and quite capable of overflowing the banks.
For more information and an overview on key trends in premium wine and water in 2019, get in touch with Jessica Altieri on LinkedIn.