Personal sizes satisfy water consumers: flavored, enhanced product offerings add to flow of retail sales

DSN Retailing Today, Oct 13, 2003 by Mike Duff

Water, water everywhere, and if the Ancient Mariner of the quoted poem lived today, he couldn't complain about being thirsty, not if he lived in North America. Bottled [H.sub.2]O is increasingly available just about everywhere so no one need go thirsty.

Yet just how consumers prefer to purchase their aqueous refreshment is changing, and merchandising is changing with it.

Consumers, it seems, prefer individualized packages and the warehouse club way of selling them, to the extent that retailers across the board are adapting club-style merchandising. They don't have to be retailers with huge sales floors, either. At a Neighborhood Market in suburban Orlando, water skewed toward multipacks of individual sizes was available in industrial racks, merchandised, it would seem, to emphasize bulk value.

In general, Wal-Mart has noticed a tidal change in water. "We are seeing an increasing popularity ha the personal sizes of bottled water," said Karen Burke, a spokeswoman.

In the 52 weeks ended Aug. 10, the bottled water category gained 12.3% to $3.1 billion, according to IRI data for food, drug and mass merchandise operators, excluding Wal-Mart. IRI breaks the category into three components. The numbers confirm what stores demonstrate. Personal-size products, whether sold individually or in bulk, are the big gainers. Convenience/PET water advanced by 21.8% in the period to $2.04 billion, IRI said, while the jug/bulk segment retreated by 4.1% to $316.8 million. The sparkling mineral segment grew by 4.2% to $221.9 million.

While personal sizes are becoming more popular, Meijer spokesman John Zimmerman cautioned that not all retailers are seeing a concurrent drain on sales of larger sizes. At Metier, nearly equal space is devoted to big and personal size packages. Water quality and taste drive part of that. Where tap water quality and taste are an issue, the bigger packages remain popular.

Juanita Kocanda, a Jewel/Osco spokeswoman said, "There is a shift towards personalized water. Everyone wants to carry a bottle. It's also a shift toward premium water. But we still sell lots of gallons."

Canada is experiencing similar trends. "Strongest growth in our stores is being experienced by the larger pack configuration, whether it be the 24- or 30-pack type or six packs," said Tom Stafford, vp of hardlines at Zellers. "Those waters are basic spring waters without any sort of flavoring."

The demand for better water was once satisfied by international, frequently carbonated varieties, but, as the IRI numbers demonstrate, such products don't have the fizz they once did. The new spin on premium waters comes from enhanced products.

"Water includes growing categories like the flavors. Aquafina has one, and Snapple has one called Elements. People want flavor in their water And, with the vitamin-enhanced, more space is being devoted to those on the shelf, too," said Kocanda, who added that retailers today have to be ready for changing currents in consumer water purchasing. "We carry what is out there and what the customer is asking for."