Enhancing the Possibilities of Bottled Water

bottled water at convenience storesBottled water sales nationwide continue to rise. Sales in convenience stores reached nearly $2.9 billion for the 52-week period ended Dec. 26, 2010, according to SymphonyIRI Group, a growth of 2.19%. Of that, more than $2.6 billion came from convenience/PET still waters.

Leading brands include Glacéau, Aquafina, Dasani, Nestlé Pure Life, Poland Spring, SoBe and others.

Among the growing trends to watch in the cold vault is efficiencies in the delivery pipeline.

“I think one of the big positives this year is going to come from Gatorade moving into the Pepsi house,” suggested Terry Messmer, merchandise manager for NOCO Express in Tonawanda, N.Y. “I think that with DSD there will be more hands on the product now. You’re going to have more people touching a key category, from the Pepsi salesperson to our managers to the merchandisers and sales people for Pepsi. They’ll have their challenges at first, but once they get it under the control the out-of-stock levels will fall. We won’t have to warehouse as much product because we’ll be getting deliveries from them once or twice a week.”

Closer Category Management
In the past, Messmer pointed out, NOCO found itself needing to keep as many as 30-40 cases of Gatorade in stock just to make sure stores wouldn’t run out. “And they were only sending in the top four flavors, so by the middle of summer some time, some stores might not be carrying all the flavors that they should. Instead, they’re kind of just hustling and bustling and filling the shelves. So I think it’s a very big positive.”

Aggressive promotions should allow convenience stores to sell more of these beverages.

Over the course of the last year or so the multi-packs of water “have really started to take off,” Messmer said. “Having that value to offer every day is drawing people to our stores. At that point, we’re competing with grocery stores and the other chains that offer a hot promotional price. The value is what the consumer is looking for.”

The bright light in the bottled water category remains enhanced waters, with consumers looking for more than just refreshment are coming to appreciate. New products, flavors and more affordable pricing are making the category attractive to all demographics.

That said, selling enhanced—or any other bottled waters in troubled economic times—means taking greater advantage of supplier programs and doing some savvy marketing and merchandising, Messmer emphasized.

Another growing trend is flavored and enhanced waters’ move toward zero calories, which of course has category management implications. “You want to look at what you’re selling, monitor scan data to forecast demand, then designate enough space to the zero-calorie products—the SoBes, vitaminwaters, and brands like them.”

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