Analysis

Focus - Leading bottled water groups respond to pressure

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The three leading bottled water brands in the UK launched the Natural Hydration Council (NHC) earlier this month. The organisation says it is not a lobby group but aims to research and promote the environmental, health and other sustainable benefits of natural bottled water. Ben Cooper spoke with the NHC's director, Jeremy Clarke, about the challenges the NHC faces.

The launch of the Natural Hydration Council (NHC) at the beginning of September is the response of an industry under pressure. It may be ironic given the negative publicity surrounding sweetened carbonated soft drinks that products which are both calorie- and additive-free are under such pressure but there is no mistaking that the 'back to the tap' campaigners have gained confidence and support, and are making an impact with consumers.

In July, research published by consumer group Which? suggested that British consumers see bottled water as expensive and bad for the environment. Half the respondents to the survey said they could not taste the difference between bottled and tap water, with 18% preferring the flavour of tap water. Which? also pointed that at GBP0.22p (US$0.44) a litre tap water is 141 times cheaper than Evian, the UK's biggest selling mineral water.

Add to the growing shift in opinion harder economic times and it is easy to see things getting tougher for bottled water, in spite of the fact that the product is perfectly in tune with the health and wellness trend.

The UK's largest natural bottled water producers, Danone Waters (UK & Ireland) Ltd, Highland Spring and Nestlé Waters UK, can see which way the wind is blowing and the Natural Hydration Council is the response.

According to the initial communiqué, the NHC's aim is "to research and promote the environmental, health and other sustainable benefits of natural bottled water". It will provide "authoritative information and advice for researchers, government, the industry, media and public about the economic and social value and impact of bottled water".

Although it has been described as a new lobbying force, director Jeremy Clarke is at pains to point out that the NHC sees its primary function as commissioning peer-reviewed research into the key issues in the bottled water debate. "The NHC has not been set up as a lobby group," Clarke tells just-drinks, describing the group as an alliance of "advocates of the benefits of bottled water".

Clarke says the NHC would commit to publish the results of research it commissions regardless of the findings. He continues: "Our commitment is to drive peer-reviewed research and there is a commitment to openness with that."

At this early stage, Clarke could not provide details of the research planned, though he did say that the NHC would be seeking to commission research into the "where, when and how" of bottled water consumption. Clarke says a lot of assumptions are made about the degree to which consumers choose bottled water over tap water. He believes, like other industry advocates, that the percentage represented by this type of consumption is relatively small, and most of the time bottled water is drunk as an alternative to other packaged drinks.

While at present the NHC only comprises three full members, as well as two associate members, Clarke says it is open to expanding the membership to other companies as well as non-corporate bodies. The three founding members represent 62.1% of the UK branded bottled water market, or 45.3% if own label is also included, according to NHC figures.

The NHC also plans to open a dialogue with campaigners. "We believe in the benefits of bottled water and if others have contrary points of view then we want to have constructive discussion and engagement on the points that have been raised," Clarke says.

Clarke may stress the science-based emphasis of the NHC and not wish it to be seen as a campaigning and lobbying group but it is clear that the campaigns against bottled water have gained momentum and if there is to be engagement with those of a contrary view, the debate is going to be vigorous.

An idea of the weight of support the environmental campaigners are increasingly drawing on can be gained from comments by the new Conservative Mayor of London, Boris Johnson, about the London on Tap campaign. "This is a magnificent campaign that will empower customers in bars and restaurants across the capital to ask for tap water rather than feeling compelled to ask for expensive bottled brands," Johnson said. "More importantly, drinking tap water will cut the amount of plastic and glass waste that we create and in turn will reduce the size of the capital's carbon footprint."

David Cameron, leader of the Conservative Party which is likely to win power at the next General Election, has moved to make green issues an important policy area for his party. Strong political allies may be in short supply for bottled water producers in the coming few years.

In that context, it is not hard to see why Nestlé, Danone and Highland Spring have decided to invest a reported GBP100,000 each in setting up the NHC. This figure, attributed to industry sources, has been widely quoted though Clarke said it was based on speculation and would not comment on the level of investment involved.

But the kind of authoritative research the NHC might be seeking to fund will not come cheap, neither does ensuring a high public profile, so its backers may well need deep pockets.

The formation of the NHC undoubtedly represents a ramping up of the representation of the bottled water sector in the UK. It supersedes the Bottled Water Information Office, which was set up under the auspices of the British Soft Drinks Association (BSDA). While some concerns were voiced that the formation of the NHC represents a move by bottled water producers to distance themselves from soft drinks advocates who also represent 'less healthy' products, Clarke stresses that the NHC will continue to work in collaboration with the BSDA, which he says was involved in the setting-up of the NHC.

Clarke also says the NHC is prepared to collaborate with British Bottled Water Producers (BBWP), an organisation which represents a number of smaller natural bottled water brands in the UK. Jo Jacobius, director of BBWP, said she was prepared to work with the NHC though as yet she had not been contacted by the organisation.


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