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Nestlé Meets Growing Thirst for Bottled Water

February 12, 2008
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Nestlé Waters North America focuses completely on bottled water, making it unique among the beverage giants. It incorporates sourcing, bottling and distribution as well as packaging and market strategy under one process.

Nestlé Waters has been the bottled water industry leader for more than two decades. This division is largely responsible for putting parent company Nestlé S.A. second, behind Coca-Cola, on Food & Drug Packaging’s Top 200 list in the beverage category.

Nestlé’s total beverage sales in 2006 were $21.1 billion. The Nestlé Waters division accounted for more than 30% of the North American bottled-water sector. In addition, the company produces other beverages such as Nestea, Nescafé coffee and Nesquik flavored milk.

Bottled water is the fastest growing segment of the entire beverage industry at an 8.7% growth rate in dollar sales for 2006.

It’s second only to soft drinks in popularity and rapidly narrowing the gap. Almost all that growth has been in the small, convenient sizes, which represents 64% of total bottled-water dollar sales. It has experienced continuous growth of more than 25% each year for the past decade.

The Nestlé brands originated in the global need for a safe family drinking water with a pleasant taste and affordable price tailored to local preferences. This need gave rise to a new multi-site production process for bottled water based on the idea that a single brand of water produced at a variety of sites would satisfy consumers and reduce costs.

In creating new packaging or new products, innovation boils down to anticipating consumer expectations, while renovation means constantly adapting the product offer to meet every need. These changes keep pace with market expectations, helping to energize brand images, promote brand loyalty and attract new consumers.

This strategy has reduced costly logistical, warehousing and transport constraints that are particularly high in the bottled water sector. It enabled consumers to enjoy the product at a more attractive price under a strong brand identity.

Perrier’s famous shapely green bottle and the classic elegance of the S. Pellegrino bottle and label are examples of instantly recognizable Nestlé icons.

In moves to makes its packaging more environmentally friendly, Nestlé Waters recently switched to clear caps that are more easily recycled. And it’s rolling out half-liter bottles that contain 12.5 grams of plastic, among the lightest water bottles around.

Nestle Waters predicts the new bottle will reduce the use of plastic resin by 65 million pounds next year, the first full year of the bottle’s availability.

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