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BOTTLED WATER - CHINA - MARCH 2017

Published By :

Mintel

Published Date : Mar 2017

Category :

Bottled Water

No. of Pages : N/A

The bottled water market in China is stable yet the growing speed in value and volume sales has shown signs of a slowdown. Premiumisation, along with the development of heathy water, is still a key trend that drives value consumption. Meanwhile increasingly sophisticated consumers will look for more justifications before paying a premium. While high-quality water sources are still most strongly associated with ‘premium’ bottled water, different age groups have different interpretations of ‘premium’, suggesting companies and brands will need to target accordingly. Consumption occasions such as on-the-go and outdoor activities are rising, and as pollution gains more attention, there is potential for bottled water featuring functional health benefits.

Table of Content

OVERVIEW
What you need to know
Covered in this Report

EXECUTIVE SUMMARY
The market
Figure 1: Retail sales of bottled water in China, by value, 2011-21
Figure 2: Retail sales of bottled water in China, by volume, 2011-21
Companies and brands
Figure 3: Market share in the retail bottled water market, by value, 2015-16
The consumer
Consumption increase in various types
Figure 4: Penetration of premium bottled water, December 2016 vs December 2015
Various occasions have increased and not just for thirst quenching
Figure 5: Consumption occasions in the last six months, December 2016 vs December 2013
High quality water sources the most perceived ‘premium’ attribute
Figure 6: Perception of premium bottled water, December 2016 vs December 2015
Consumers favour domestic water sources
Figure 7: Preference of water sources, top three choices, December 2016
Figure 8: Correspondence analysis – Perception of water sources, December 2016
What we think

ISSUES AND INSIGHTS
Premium bottled water moving on from relying on provenance
The facts
The implications
How to innovate using the concept of ‘anti-pollution’
The facts
The implications
How to target women and develop flavour innovation?
The facts
The implications
Figure 9: Evian Brumisateur facial spray, France, February 2017

THE MARKET – WHAT YOU NEED TO KNOW
A healthy value market and a slowly grown volume market
Pollution drives new product innovation
Premium water must justify claims and prices

MARKET SIZE AND FORECAST
Premiumisation is still the key for value market growth
Figure 10: Retail sales of bottled water in China, by value, 2011-21
Flavoured and fizzy segments grow
Figure 11: Import value and volume of natural spring water and fizzy water, China, 2015-16
Figure 12: Top ten countries exporting natural spring water to China, 2016
Figure 13: Top ten countries exporting fizzy water to China, 2016
A slowing volume market
Low-end segment shrinks
Figure 14: Retail sales of bottled water in China, by volume, 2011-21

MARKET FACTORS
Diversifying occasions can help consumption increase
Increasing awareness of body hydration needs
Ultra-high-priced imported products may lose competitive advantages
Figure 15: Average selling price of bottled water, by price tiers, 2016

KEY PLAYERS – WHAT YOU NEED TO KNOW
A consolidated market
Competition in new packaging and products
‘Soda water’ and ‘black water’ trends of 2016

MARKET SHARE
Wahaha is losing share
Master Kong expands global reputation but suffers domestic loss
Baisuishan gains share via a ‘multi-species, sub-brands’ strategy
Figure 16: Market share in the retail bottled water market, by value, 2015-16

COMPETITIVE STRATEGIES
Silent price wars
Figure 17: Evergrande Spring bottled water range price reduction, 2015-16
Compete with new packaging and products
International brand partnering with domestic distributors
Figure 18: Voss in the global market, 2016-17
Pollution drives new concept for healthy bottled water
Competing with sports related sponsorships

WHO’S INNOVATING?
Social media claims are on the rise
Figure 19: Trends of claims made in newly launched bottled water in China, 2012-16
Figure 20: Bottled water with social media claims, China, 2016-17
Soda water is emerging
Figure 21: Soda bottled water in China, 2016-17
Flavoured water lacks innovation – ‘Water+’ could be a solution
Figure 22: Top 10 flavours in flavoured bottled water, 2015-16
Figure 23: Flavoured bottled water in China, 2016-17
Black water – The ‘black horse’ of 2016
Figure 24: Black bottled water, China, 2016-17
The diversification of the bottled water consumption occasions
Children bottled water

THE CONSUMER – WHAT YOU NEED TO KNOW
Increased penetration of all types of bottled water
High brand reputation and loyalty exists in terms of consumption
New consumption needs and rising consumption occasions
Consumers associate ‘natural’ and ‘healthy’ with a variety of water sources
Mintropolitans embrace both domestic and foreign water sources

PENETRATION OF DIFFERENT BOTTLED WATER TYPES
Consumption increase in various types
Figure 25: Penetration of different bottled water types in the last six months, December 2016 vs December 2015
Consumers prefer drinking a variety of bottled water types
Figure 26: Penetration of different types of bottled water in the last six months, December 2016
Figure 27: Non-carbonated soda water, China, 2016

BRAND CONSUMED MOST OFTEN
Top brands remain the same in a two-year comparison
Figure 28: Brand consumed most often in the last six months, December 2016
Regional preferences of the top brands
Figure 29: Brand consumed most often in the last six months, by region, December 2016

CONSUMPTION OCCASIONS
Various occasions have increased and not just for thirst quenching
Figure 30: Consumption occasions in the last six months, December 2016 vs December 2013
Dining out as a food and drinking paring consumption driver
Gender is a differentiator for different consumption occasions
Figure 31: Selected consumption occasions in the last six months, by gender, December 2016
Children in household diversifies consumption occasions
Figure 32: Consumption occasions in the last six months, by children in household, December 2016

PERCEPTIONS TOWARDS PREMIUM BOTTLED WATER
High quality water sources perceived as most ‘premium’ attribute
Figure 33: Perception of premium bottled water, December 2016 vs December 2015
Different age groups have different options about ‘premium’
Figure 34: Perception of premium bottled water, by age, December 2016
Figure 35: Selected bottled water products for younger consumers, China, 2016
Figure 36: Bottled water with limited edition claim, China, 2016

PREFERENCE OF WATER SOURCES
Consumers favour domestic water sources over exotic ones
Figure 37: Preference of water sources, top three choices, December 2016
Regional preferences linked to origins of water sources
Figure 38: Preference of water sources in the last six months, top three choices, domestic vs foreign water sources, December 2016

PERCEPTION OF WATER SOURCES
Most water sources considered ‘natural’ and ‘good for health’
Figure 39: Correspondence analysis – Perception of water sources, December 2016

MEET THE MINTROPOLITANS
Mintropolitans embrace all bottled water types
Figure 40: Penetration of different types of bottled water in the last six months, by Mintropolitans vs non-Mintropolitans, December 2016
Mintropolitans favour international brands and are selective when purchasing domestic brands
Figure 41: Brand consumed most often in the last six months, by Mintropolitans vs non-Mintropolitans December 2016
Mintropolitans consume more in diverse occasions
Figure 42: Figure 43: Consumption occasions in the last six months, by Mintropolitans vs non-Mintropolitans, December 2016
Mintropolitans prefer both domestic and foreign water sources
Figure 44: Preference of water sources in the last six months, top three choices, by Mintropolitans vs non-Mintropolitans, December 2016

APPENDIX – MARKET SIZE AND FORECAST
Figure 45: Retail value sales for bottled water in China, 2011-21
Figure 46: Retail volume sales for bottled water in China, 2011-21

APPENDIX – METHODOLOGY AND ABBREVIATIONS
Methodology
Fan chart forecast
Abbreviations

List of Table

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