Bottled water sales have suffered in recent years with the credit crunch causing consumers to revert to tap water. However, Mintel says its latest
research shows that, as consumer confidence is returning, so is the popularity of bottled water. According to Mintlel, the bottled water market was thriving until recently – more than doubling its sales from 1997 to 2007 to reach 2.5 billion litres. But as consumer confidence fell dramatically, a situation not helped by consecutive poor summers, volume sales of the market fell by 11% between 2006 and 2008. Mintel added: "With the industry attracting environmental criticism and consumers seemingly happy to exchange bottled for tap water, some were predicting the market to be in terminal decline."
However, Mintel said the new research showed reasons for optimism. The decline in sales slowed to just 1% in 2009 with Brits drinking 2.3 billion litres of bottled water and the market worth £1.9 billion. With economic conditions expected to improve, Mintel forecasted that volume sales would start growing steadily from 2011 onwards and that by 2014 the British would be consuming 2.5 billion litres a year, a return to 2007 levels.
Jonny Forsyth, senior drinks analyst at Mintel, said: "Consumer confidence is inextricably linked with bottled water consumption. When the decline in confidence began in the latter half of 2007, bottled water became one of the easiest products for cautious consumers to sacrifice. After years of not having to worry about the pennies, the first question consumers started asking when purchasing was ’Is this value for money?’ and at around 250 times cheaper, tap water suddenly seemed a much more sensible option. However, with consumer confidence rising over recent months, consumers have started to loosen their purse strings and bottled water has been one of the beneficiaries."
Mintel added that more than a third of consumers in Britain (35%) currently thought bottled water tasted better than tap water. But the research revealed there was still a huge question mark over whether bottled water was good value, even among its drinkers. Only one in ten thought of it as value for money, a third thought it was "a bit of a con" and four in ten thought it was no healthier than tap water.
"Such consumer scepticism has left the bottled water market particularly vulnerable to an economic slump, and consumers need to be reminded of why it is a product worth paying for to ensure the recovery continues." Forsyth continued. "Most of us do not have the time or inclination to fill up a bottle with tap water for when we are out and about and, unlike other soft drinks, plain bottled water allows us to rehydrate without consuming calories or additives – a major selling point to an increasingly health and weight obsessed consumer."