UK Bottled Water 2013 Report

Zenith Report on UK Bottled Water April 2013

Zenith Report on UK Bottled Water April 2013

Copyright All copyright in all Zenith reports is reserved. All text, tables, charts and other material contained within this report, which are the exclusive property of Zenith International Ltd, may not be copied, distributed, transferred or displayed without the express written consent of Zenith International Ltd. Liability Whilst every effort has been made to ensure that the information presented in this document is accurate and that the opinions expressed are sound, Zenith International Ltd cannot be made liable for any errors or omissions or for any losses or consequential losses resulting from decisions based on its contents.

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2013 ZENITH REPORT ON UK BOTTLED WATER CONTENTS UK BOTTLED WATER MARKET COMMENTARY Introduction Brief Summary Research overview

1 2 4

2012 UK bottled water market Market overview Economy Weather Media Sector performance

5 5 5 7 7 9

UK packaged water UK bottled water packaging UK bottled water distribution UK bottled water companies UK bottled water groups UK bottled water producers Bottled water exports Bottled water imports Still water consumption Packaged still water brands Carbonated water brands Retailer own label Mineral water consumption Spring water consumption Glass packaged bottled water Plastic packaged bottled water Plain vs flavoured water UK water coolers Bottled water consumer Bottled water value Ethical waters / Ethical initiatives

11 12 12 13 14 14 15 16 17 17 18 19 20 20 21 21 22 23 24 25 26

Ongoing challenges Environmental Carbon footprint Water footprint Lightweighting Recycling Tap water Industry consolidation Portfolio diversity Consumer confidence and education Retailer perception Stock control

29 29 30 30 30 30 30 31 31 32 33 34

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Price pressures

34

Legislation

35

Forecast to 2017

36

APPENDICES APPENDIX 1 – CHARTS Market overview 1 UK mean temperature, 2007-2012 2 UK sunshine hours, 2010-2012 3 UK rainfall, 2010-2012 4 UK packaged water vs water coolers, 2007-2012 5 UK bottled water packaging, 2012 6 UK bottled water distribution, 2012

38 38 39 40 41 42 43

Industry structure 7 UK bottled water industry consolidation, 2007-2012 8 Top 5 bottled water companies, 2007 & 2012 9 Top 5 bottled water groups, 2012 10 Leading UK bottled water producers, 2012

44 45 46 47

Imports and exports 11 UK bottled water exports, 2007-2012 12 UK bottled water imports, 2007-2012 13 Leading UK imported waters, 2012

48 49 50

Market segments 14 UK still water consumption share, 2007-2012 15 Leading UK packaged still water brands, 2012 16 Leading UK packaged sparkling water brands, 2012 17 UK own label water consumption share, 2007-2012 18 UK own label water producers, 2012 19 UK natural mineral water consumption share, 2007-2012 20 Leading UK mineral water brands, 2012 21 Leading UK spring water brands, 2012 22 Leading UK companies in glass, 2012 23 Leading UK companies in plastic, 2012

51 52 53 54 55 56 57 58 59 60

Bottled water market in context 24 UK plain vs flavoured water, 2007-2012 25 UK still vs sparkling flavoured water, 2007-2012 26 UK water cooler market, 2007-2012 27 GB bottled water consumer, 2007-2012

61 62 63 64

Value 28 UK bottled water market value, 2007-2012

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Forecasts 29 UK bottled water market forecast, 2007-2017

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APPENDIX 2 – TABLES Market overview 1 UK bottled water market, 2006-2012 2 UK bottled water types, 2006-2012 3 UK bottled water: small pack vs cooler, 2006-2012 4 Total UK bottled water: Per capita consumption, 2006-2012 5 UK bottled water packaging, 2010-2012 6 UK bottled water distribution, 2010-2012 7 UK bottled water packaging, 2012

67 67 68 69 70 70 71

Industry structure 8 Top 25 companies in UK bottled water market, 2011-2012 9 Next 25 companies in UK bottled water market, 2011-2012 10 Top 25 brands in UK bottled water market, 2011-2012 11 Next 25 brands in UK bottled water market, 2011-2012

72 73 74 75

Market segments 12 UK top 10 carbonated water brands, 2011-2012 13 UK top 10 packaged still water brands, 2011-2012 14 UK top 20 mineral water brands, 2011-2012 15 UK top 20 spring water brands, 2011-2012 16 UK top 10 own label water producers, 2011-2012 17 UK top 10 water cooler companies, 2007-2012 18 UK top 10 companies in glass packaging, 2011-2012 19 UK top 10 companies in plastic packaging, 2011-2012

76 76 77 78 79 79 80 80

Production, bottled water consumer, imports and exports 20 Top 10 UK bottled water producers, 2011-2012 21 Top 10 UK produced brands, 2011-2012 22 GB Bottled Water Consumer, 2007-2012 23 UK top 10 water export brands, 2007-2012 24 UK bottled water exports by country, 2007-2012 25 UK bottled water imports by country, 2007-2012 26 UK bottled water import sales by brand, 2007-2012

81 81 82 82 83 83 84

Value 27 UK Bottled Water Value, 2010-2012 28 UK bottled water value per litre by pack size, 2011-2012 29 Premium vs private label retail value per litre, 2011-2012 30 International premium vs private label value per litre comparison, 2012

85 85 86 86

Ethical Waters 31 UK Ethical Waters, 2009-2012

87

Forecasts 32 UK bottled water consumption by segment, 2012-2017

87

Bottled water market in context 33 UK bottled water in context, 2007-2012 34 International bottled water comparison, 2007-2017

88 88

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APPENDIX 3 - LEADING COMPANY PROFILES AG Barr Plc Angel Springs Holdings Ltd Berrington Pure Spring Water Best Water Technology Black Mountain Mineral Water Company

89 92 94 96 98

Blue Keld Spring Water Brecon Mineral Water Britvic Plc Coca-Cola Enterprises Coca-Cola HBC Northern Ireland

100 102 104 106 108

Cott Beverages Ltd Danone Waters (UK & Ireland) Ltd Decantae Natural Mineral Water Eden Springs UK Fonthill Pure English Spring Water

110 113 115 117 119

Godlingston Manor Springs Ltd Highland Spring Ltd Hildon Ltd Iceni Isabelle

121 123 127 129 131

Isklar Kingshill Mineral Water Ltd Montgomery Spring Water Company Navson Drinks Nestlé Waters UK Ltd

133 135 137 139 141

Norbev Prince’s Gate Spring Water Princes Soft Drinks Radnor Hills Mineral Water Company Roxane

144 146 148 150 153

Shepley Spring Ltd Swithland Spring Water Waterbrands Ltd Water Coolers (Scotland) Ltd Water for work and home

155 157 159 162 164

APPENDIX 4 - UK BOTTLED WATER MARKET IN PERSPECTIVE

167

APPENDIX 5 - LEGISLATION

174

APPENDIX 6 - DEFINITIONS AND SYMBOLS

177

APPENDIX 7 - TARGET GROUP INDEX (TGI)

180

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Zenith Report: April 2013

UK bottled water

2013

Introduction

This is the twenty-second Zenith Report on the UK Bottled Water Market, and there is now a diverse range of other emerging markets covered by the Zenith Report series. With each our aim is to make contact with every significant company active in the relevant sector and to produce as complete a picture as possible at a price accessible to any business with a serious commercial interest.

We are particularly grateful for the help we receive from the bottled water companies we profile. The 2013 Report contains up to date profiles of the industry’s leading bottled water companies, while text, charts and tables analyse recent developments in the UK market. An historical perspective is provided in Appendix 4.

The report represents exceptional coverage of the UK bottled water market and we hope that you find it useful in your business planning. As our research is updated on a regular basis, we always welcome any comments or suggestions about possible improvements.

Cecilia Martinez Regional Research Co-ordinator - Americas Zenith International

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1

4: UK PACKAGED WATER VS WATER COOLERS, 2007-12 million litres

2007

2008

2009 Packaged

2010

2011

2012

Water Cooler 41

5: UK BOTTLED WATER PACKAGING, 2012 % share

R Polycarb

Others

NR Glass

NR PET Total consumption: million litres 42

6: UK BOTTLED WATER DISTRIBUTION, 2012 % share

Offices

Others

Horeca; pubs, clubs

Modern Retail Convenience, Impulse

Total consumption: million litres 43

7: UK BOTTLED WATER INDUSTRY CONSOLIDATION, 2007-12 Percentage Share

2007

2008

2009 Top 5

2010

2011

2012

Top 10 44

10: LEADING UK BOTTLED WATER PRODUCERS, 2012 % share

Others Nos. 7 to 10

Company 6

Company 5

Company 1

Company 4

Company 3

Company 2

Total UK bottled water production: million litres

47

13: LEADING UK IMPORTED BRANDS, 2012 % share Others

Brand 5 Brand 1 Brand 4 Brand 3

Brand 2 Total UK bottled water imports: million litres Source: UK Government figures

50

18: UK OWN LABEL WATER PRODUCERS, 2012 Company 6

% share

Others Company 1

Company 5

Company 4

Company 2

Company 3 Total UK own label sales: million litres 55

22: LEADING UK COMPANIES IN GLASS, 2012 % share

Company 1 Others

Company 2

Nos 6 to 10 Company 3 Company 5

Company 4

Total UK packaged water in glass: million litres 59

23: LEADING UK COMPANIES IN PLASTIC, 2012 Others

% share

Company 1

Nos 6 to 10

Company 2

Company 5

Company 4 Company 3 Total UK packaged water in plastic: million litres 60

28: UK BOTTLED WATER MARKET VALUE, 2007-12 market value (£ mln)

value per litre (£)

1600

0.84

1400 1200

0.82

1000 800

0.80

600

400

0.78

200 0

0.76 2007

2008

2009

2010

2011

2012

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APPENDIX 6 - DEFINITIONS AND SYMBOLS DEFINITIONS Natural Mineral Water The basic requirements of the UK regulations are:  Must come from a recognised groundwater source. Recognition is granted by local authorities to meet EU standards and requires a lengthy testing process to ensure freedom from pollution and a consistent mineral composition.  Must be bottled at source unless the practise was to tanker to the bottling plan on or before 17th July 1980.  Cannot undergo treatment except for filtration of particles, except in exceptional circumstances.  Nothing can be added to water except carbon dioxide for carbonation.  The water can only be bottled under a single name, described as natural mineral water.  The water must meet strict requirements for microbiological and chemical purity.

Spring Water The basic requirements of the UK regulations are:  Must come from a groundwater source.  Must be bottled at source (unless the practise was to tanker to the bottling plant on or before 23 rd November 1996).  In the UK, spring water can currently undergo some forms of treatment.  The water can only be bottled under a single named Spring Water. However, additional Bottled Drinking Waters can be produced from the same source.  The water must meet requirements for microbiological and chemical purity based on the requirements for tap water.

Bottled Drinking Water The basic requirements of the UK regulations are:  ‘bottled drinking water‘ is a legal category of water and should not be confused with the general use of the term ‘bottled water’.  Can come from any source – groundwater, surface water (e.g. a lake or river), tap water or other (e.g. glacier, iceberg, rainwater)  Need not be bottled at source.  Can undergo any form of water treatment.  Water from a single source can be bottled under different names.  Can be bottled under any description except one that is misleading to consumers. Use of the description natural mineral water, spring water or mineral water is not permitted. Some commonly used descriptions are ‘Table Water’ and ‘Purified Water’.  The water must meet requirements for microbiological and chemical purity based on the requirements for tap water.

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These definitions are a simple description of the requirements of the UK bottled water regulations. For a detailed definition please consult the Natural Mineral Water, Spring Water and Bottled Drinking Water Regulations, 1999 and any subsequent amendments. For a detailed review of the implications of the regulations, consult Zenith’s ‘Plain Language Guide to the UK Bottled Water Regulations’. Further information can be found at www.zenithinternational.com and search for Plain Language Guide.

Distribution channels Retail Supermarkets  Multiples and other grocers – Tesco, Sainsbury, Asda, Waitrose, Morrisons, Somerfield, Co-op, Marks & Spencer, Boots, Budgens, Iceland  Aldi, Lidl and other discounters  Smaller local supermarkets (e.g. Booths, Harry Tuffins)  Supermarket forecourts and smaller formats of the major multiples (e.g. Tesco Metro) Independent, others  Confectioneries, tobacconists and newsagents (CTNs)  Convenience stores (e.g. Londis)  Small independent grocers  Other forecourts  Off licences  Other retail stockists/cash & carry Door-to-door  Dairy deliveries  Direct mail orders  Door-to-door deliveries of water for coolers Away From Home Offices  Water supplied in places of work such as offices, factories etc.

Horeca, pubs and clubs  Horeca – hotel, restaurant and catering channels  Cafés, bars, pubs  Nightclubs  Food service  Vending machines Others  All other away from home outlets

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SYMBOLS ...

Negligible, less than 0.05

e

Estimate

Foodservice

Distribution to on-premise or horeca outlets

Horeca

Hotels, restaurants and catering

na

Not available, not applicable

NR

Non returnable packaging

HDPE

High Density Polyethylene

HOD

Home and Office Delivery

PET

Polyethylene terephthalate

PLA

Polylactide or polylactic acid

POU

Point of use (mains water) cooler

PVC

Polyvinyl chloride

R

Returnable packaging

VPL

Value per litre

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APPENDIX 7 - TARGET GROUP INDEX (TGI) Target Group Index (TGI) syndicated surveys provide actionable single-source data on consumer behaviour, purchasing habits, attitudes and motivations.

Established in 1969 and originally focused on the British market, TGI has since expanded to cover more than 65 countries.

In Britain TGI is representative of all adults aged 15+ and is used by over 300 companies, including brand owners, media owners and advertising agencies.

TGI enables    

Awareness of market trends and dynamics Identification of opportunities for new and existing brand development Accurate description of target groups Improved marketing strategies and advertising campaigns

TGI is    

Insightful and actionable Information on usage of over 4,000 brand across 500 product areas Updated four times a year Single source and independent of vested interest

www.kantarmedia-tgigb.com TGI’s consulting offer, TGI Insights and Integration, enables the breaking of new ground in consumer insight through the provision of the most suitable skills, tools, analysts and thinking. With genuine global reach (we are part of Kantar, WPP’s insights and consultancy arm) and unique access to raw TGI data in 65 countries we are a strategic partner to the world’s most demanding consumer-facing industries.

Anne Benoist - Director +44 (0)20 8433 4227 anne.benoist@kantarmedia.com www.tgi-insights.com

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