CHAPT ER ONE
INTRO DUCTI ON
Water is the fountain of all life. Even a toddler will tell you it is a prime need of the Sixty weight body. percent is
millions with diseases such as diarrhea, dysentery, typhoid, jaundice and gastro-enteritis. Getting pure drinking water from municipal taps in cities and towns is now a luxury. At home most people are forced to either boil water or install purifiers. While traveling or eating out in restaurants, buying bottled water has become a necessity. This need has seen an explosion of companies marketing “safe drinking water” in bottles across the country.
1.1 THE PACKAGED DRINKING WATER INDUSTRY – AN OVERVIEW
India is the tenth largest bottled water consumer in the world. In 2002, the industry had an estimated turnover of Rs.10 billion (Rs.1,000crores).Today it is one of India's fastest growing industrial sectors. Between 1999 and 2004, the Indian bottled water market grew at a compound annual growth rate (CAGR) of 25 per cent - the highest in the world. With over a thousand bottled water producers, the Indian bottled water industry is big by even international standards. There are more than 200 brands, nearly 80 per cent of which are local. Most of the small-scale producers sell non-branded products and serve small markets. In fact, making bottled water is today a cottage industry in the country. Leave alone the metros, where a bottled-water manufacturer can be found even in a one-room shop, in every medium and small city and even some prosperous rural areas there are bottled water manufacturers. Despite the large number of small producers, this industry is dominated by the big players - Parle Bisleri, Coca-Cola, PepsiCo, Parle Agro, Mohan Meakins, SKN Breweries and so on. Parle was the first major Indian company to enter the bottled water market in the country when it to introduced Bisleri in India 25 years ago. The total annual bottled water consumption in India
of our body made up of it. Water can also be the cause of much India, water continues bring down misery in where especially
1.2 OVERVIEW OF THE MARKET SHARE
Currently, Bisleri continues to lead in the Rs 700-1,000 crore organized, packaged water market with an estimated 40 per cent market share, followed by Kinley at 28 per cent and Aquafina with an 11 per cent share. In terms of volumes, the North and West remain Bisleri's biggest performing markets, despite the brand's sustained national-level presence. The market has been growing for the last three years at an unimaginable rate of 80%. The market size of bottled water is expected to surpass the size of soft drinks market very soon in the near future.
Individual Market Shares: BISLERI-40%, KINLEY-28%, AQUAFINA-11%, OTHERS-21% Due to the demand for water, a large number of "mineral water manufacturers" have been spawned selling little more than tap water to the unsuspecting consumer, the majority of whom are still very native about mineral' water. Pepsi Co's Aquafina brand, which debuted the bottled water business in September 1999, targets the youth sector and concentrates on just one pack size, 750ml priced ten rupees.
Coca-Cola is the most recent entrant (May 2000) with its Kinley, brand and in a controversial and unsuccessful marketing campaign, it obtained an endorsement from the Federation of Family Physicians' Association of India (FFPAI), a lesser known body of doctors for its brand. Estimates show that there are around 100 small regional players in the bottle water market and the number have been growing at an unbelievable 70%-100% per year, year on year, for the past four years. This has enticed a number of international brands in the market besides Coca-Cola and PepsiCo-Nestle (Pure Life), Britannia, Lever, United Breweries and Shaw Wallace. Danone Pairs launched Evian some time back and even imported hundreds of cases for VIP guests celebrating the Hindu festival, KumbhMela. The government has been forced to sit up, take notice and tighten regulations after comprehensive sample tests were taken by consumer groups and found that a number of the smaller and more unscrupulous "opportunistic" players were selling little more than tap water. Until recently the government of had set standards only for mineral water and even the PFA (Prevention of Food Adulteration Act) and BIS (Bureau of Indian Standards) were deficient when compared to international markets. Under the new regulations 48 specifications are to be met for water to become mineral water and for packaged drinking water there are 43 specifications. But small players are bound to fall out of the market by April 1, 2001 when the new regulations were supposed to be enforced.
The mineral water market is segmented according to the type of consumers: Foreign Tourists Foreign tourists have been the main consumers of the mineral water as they face a lot of digestion problems due to different food habits. Domestic Tourists Domestic tourists have switched to mineral water mainly because of safety and hygiene factors. Health/Fashion Conscious Like soft drinks, drinking mineral water is also considered fashionable by some people. The mineral water consumer is mainly in the age group of 20-35 years and is an educated middle class person. This is also the segment of fruit drinks, which have usually been positioned as fun and health drink for young adults. The mineral water market is also segmented along pack sizes: One litre bottle This is meant to spell safety and security for consumers. It is positioned on a prestige platform for the achiever segment - who like to make a fashion statement by drinking mineral water. This segment gets the maximum sales. 500ml bottle This size has been introduced in the market to target the individual and local travelers. PET bottles The size of the PET bottles varies from 10 to 20 litres. These are mainly for institutional sales (Wedding parties, Hotels, Corporate, etc.)
1.4 CONSUMER HABITS & PRACTICES
• • Consumers are growing more health conscious and are more careful of their drinking habits. Brand loyalty is very low as all the products taste the same so they can buy just any product which is on the shelf, same as that of soft drinks and fruit beverages. • Availability in the chilled form and brand awareness plays a crucial role in purchase decisions. • While there is no aversion to consumption of mineral water by any age group, this product is mainly consumed by the people in the age group of 20-35 years who have less attraction of soft drinks or other synthetic drinks whereas youngsters look in for soft drinks and fruit beverages to quench their thirst. • Visibility is another factor that should be taken care of by the companies as consumers are not very brand loyal and consume whatever is in front of them. Consumers often drink bottled water as an alternative to tap water. They think it tastes better (no chlorine taste) and perceive it to be safer and of better quality. They also look for security: food scandals in industrialized countries and water-borne diseases in developing countries greatly influence consumers’ attitudes. Consumers buy bottled water to feel well and to lose weight. Bottled water is perceived as a healthy alternative to other beverages. Thus, for the aerated beverages bottled water offers a potential threat. Moreover, increasing urbanization, causing declines in tap-water quality, can also explain the popularity. Because it is untreated, natural mineral water is perceived as “natural” by city dwellers looking for genuine products. Higher living standards and auto usage enable people to easily bring home more and heavier bottles of water. At the office, a bottle of water is now a common sight on the desk, next to the computer and the telephone. Drinking bottled water is a sign of a rise in the social scale. Above all, bottled water has become a huge marketing success.
1.5 SWOT ANALYISIS OF THE INDISN PACKAGED DRINKING WATER INDUSTRY
STRENGTHS The industry is growing @ 40%. In India the market is huge & untapped Growing awareness among the people about the importance of mineral water WEAKNESSES Many players entering in the race. Any local person can start manufacturing. Rural population is not using the packaged water. Not very economical. Quality not properly maintained. OPPORTUNITIES
market growth increase in coming years.
rate growing and hence the awareness of safe drinking water to avoid the
diseases. Huge population & untapped market. THREATS Many substitutes available, Too many players will dilute the market & the profit margin.
1.6 MAJOR PLAYERS
With over 200 players jostling to be the thirst-quenching favorite of the Indian consumer, the business is growing at a rate of over 50 per cent annually. The country's bottled water business is estimated to be around Rs. 1,100/- crore, of which the branded market accounts for Rs. 700 crore and about 700 million litres in volume. After the Cola wars the time has come for water wars. Here we discuss the major players and warriors in the bottled water market. BISLERI The brand is a product of Parle International and presently is the market leader with more than 45% market share. The company pioneered the concept of bottled water in the Indian market as early as 1967. The company is also credited with SKUs of 500ml, 1.2 ltr, 1.5 ltr and 2 ltr in the Indian market The re-launch of Bisleri in 1993, however was a success due to growing awareness and high consciousness of health and hygiene among people. In 1993, when Ramesh Chauhan, Chairman, Parle Bisleri sold his right to market Bisleri brand to Coca-Cola, Bisleri, which underwent the new management for a period of 5 years, remained largely neglected. On getting the rights back, he started building Bisleri as a mineral water brand. Bisleri had a brand name, a product, the brand building of Bisleri started in a small way in 1998, which bore fruit in 19992000 when it grew by 140%. Positioning Target audience Personality Punch Line USP : : : : : Playing Safe Health and hygiene conscious people Guardian, Authoritative, Reliable “Play Safe” Pioneer advantage in bottled water industry, old player with lot of Experience In the case of 500ml and 1 litre it directly supplies to the retailer
In the case of 20 litre jar they have appointed distributor over the area to reach through the corporate. But then also they lack in providing better service to the customer. KINLEY This brand was first introduced in the country in March 1998, when COKE launched Kinley Soda. The company entered in the business in May’00 through its brand, Kinley. The company tied up with Kothari Beverages, of Yes brand of mineral water, for manufacturing coke’s brand at Yes’ facilities. Starting with Bangalore, Kinley mineral water was rolled out nationally in a phased manner. Positioning: Safety and health oriented Target audience Personality Punch Line USP : : : : Health and hygiene conscious people Trustworthy, Strong, Confident “Boond Boond mein Vishwas” Belongs to the Coca Cola lineage, gains advantage from the distribution and retail network Error: Reference source not foundIn the case of 1 litre and 500ml it directly supplies to the retailer without any distributor. In the case of 20 litre jar they have their own distributor. These above 2 are the top players in the market other brands present are:AQUAFINA Entered the bottled water business in September 1999 by test launching its first in Mumbai and then in Bangalore. PEPSI with its AQUAFINA brand has backing of a good distribution channel of 60000 outlets, its refrigerators at retail outlets which stock its cold drinks along with Aquafina as well. Initially Aquafina was available in just one pack-750 ml and was priced at Rs. 10. Now they also have competing packages of 500ml and 1 ltr ml pack priced at Rs.6 and Rs. 10 respectively. The main target audience for Aquafina is the youth segment. By end 2002 PEPSI added 7 more to its existing base of 5 plants. Unlike most players, Pepsi is not looking at bulk buys or in-house consumption at the moment. The focus was thus only on one SKU, that
too 750ml. Though the company is present only in selected market as of now, it has plans of increasing share in the market by expanding its SKUs portfolio as well as its distribution reach.
NESTLE With its mass-market product branded PURE LIFE has banked on its distribution network for chocolate, which are marketed through a large chain of retail outlets. Pure Life is aimed to have a National presence; the second brand which is being tried for by the company is aimed at targeting the regional markets. Pure Life is for Mass Market like hotels, restaurants and café segment and Perrier for the bars, San Pellegrino for the restaurants, but nestle is not yet into home & office segment. The company has priced the ‘Pure Life’ brand very competitively in the market.
THERMAX A player of Technical Expertise is THERMAX, through a joint-venture with US-based CULLIGAN WATER TECHNOLOGIES largely into industrial water purification. It has entered into the household segment with the launch of 20-litre packs of drinking water – branded as Good Water, priced at Rs.60 per pack. GOOD WATEREVERFLO is positioned for organizations that are actively improving the quality of the workplace for employees and visitors. It is an ideal solution to those wanting to make pure, safe drinking water available, without buying and maintaining in-house equipment like purifiers, water coolers etc. However the company has no plans to introduce smaller package for its product BAILEY Though a pioneer in this field; Mr. Ramesh Chauhan Chairman- of Parle Bisleri had to contend with several new entrants in this segment. For starters, his own brother, Mr. Prakash Chauhan through Brand Bailey has been trying to emulate the Bisleri success through the franchising route, but Bailey has never been successful in it. The brand is a product of Parle Agro, the company of Frooti fame. The company presently is the second largest player in the market with share of 20%. The company has recently extended its Bailey brand name for its soda water. It is also credited with forming a new segment of 330ml SKU in the market Target audience : Health and hygiene conscious people
Personality Punch Line USP
: : :
Guardian, Authoritative, Reliable “I want my bailey” Pioneer advantage in bottled water industry, old player with lot of Experience
EVIAN Evian by DANONE INTERNATIONAL is marketed by BRITANNIA INDUSTRIES in India. The high-priced mineral water from French Alps is clearly targeted at the premium segment of consumer. Currently Evian has more of an Institutional presence (5 star hotels) than on retail shelves. With 1 litre bottle being priced a hefty Rs.80 Then, there is GODREJ with AQUAPURE. Britannia also plans to launch its own branded water very soon. NATIONAL DIARY DEVELOPMENT BOARD also plans to launch DHARA through its distribution channel. New Entrant ATCO with BRILLIANT WATER &DS FOODS with CATCH SPRING water positioned on the mineral water plant. Even HLL is said to be firming up plans to enter the market. Apart from these, are other players which cater to nearly same market as the big players do. Other players in the market with strong regional presence are: Brilliant, Yes, Hello, Purette, Fountain, Himalayan, Golden Eagle, Prime, Pure Natural Aqua, Ganga, Florida, Metro etc
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2.1 COMPANY PROFILE OF BISLERI
In 1967, Bisleri an Italian company, started by Signer FeliceBisleri, first brought the idea of selling bottled water in India. It started a company called Bisleri India. In 1969, Ramesh Chauhan, the Chairman of Parle Exports, bought over the brand. In those days, Bisleri packaged drinking water was available in glass bottles. Being a returnable package owing to various other problems such as breakage and weight, in 1972-73, Bisleri was made available in PVC (Poly Vinyl Chloride) bottles. After this plastic packaging was introduced, things started to change, and sales increased rapidly. The upsurge in the sales of Bisleri started in 1993 as Ramesh Chauhan sold off the Parle stable of brands, including Thums Up, Limca and Gold Spot. Recognising the potential of the packaged drinking water market, he then went on to concentrate on making Bisleri a top selling brand in India.
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2.2 The Present
It was around the year 1995, when Parle Exports took charge of the brand operations and the business took off in the market. With factories across India and a strong distribution network, Bisleri established itself as a force to reckon with in the domestic packaged drinking water market. Earlier the packaged drinking water market consisted of five star hotels, tourists and foreigners. As a marketing strategy, a conscious decision was taken by the company that only 40% of the sales should come from these outlets and 60% from general market, i.e. paanwallas, street shops, general stores and even non-tourists. This brought about a sea change in the perception in the consumer's mind about consumption of Bisleri. Earlier, drinking bottled water was considered to be more of a status symbol. That thinking has slowly changed to the point where today, not drinking Bisleri is considered as being behind the times. Such has been the presence and penetration of the Bisleri brand in the bottled water segment. About few years ago, in 1998, a strategy was adopted to concentrate aggressively on the home market. The habit of boiling water or using electronic gadgets was not adequate, since the source of water itself was unreliable. The bulk packages like the 2, 5 and 20 litre bottles were introduced to meet this market need. The price per litre went down as a result, making bottled water very economical for the consumer.
2.3 Future Plans
Bisleri was the first to market bottled water in a totally virgin market and naturally people associate the brand with bottled water. Now Bisleri is perhaps already ten steps ahead of its competitors and will endeavor to widen its gap in the times to come. Bisleri's brand positioning stresses on pure, clean and safe drinking water.
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Some of the future plans to maintain the top spot that Bisleri commands in the Indian market are: • • • New pack sizes in bottles and cups Increase the distribution network with an investment of over 200 crores Strengthen presence in traditionally weak areas by setting up 12 new bottling facilities at a cost of Rs. 150 crores.
2.4 Technology Developments
To make sure that the product that reaches the consumer is always of highest standard and also meets international standards, Bisleri has always been involved in improving its product packaging. One such recent development is the tamper proof break away seal. Bisleri also recognizes the need to produce environment friendly products and is working on the PET project.
The break away seal
Keeping in mind the consumer's need to recognise a genuine product that cannot be tampered with, Bisleri developed the break away seal. The unique cap has been patented and cannot be duplicated or tampered with. This technology development in the product ensures that the consumer will only get a highly safe product when they consume Bisleri packaged drinking water.
To ensure purity of the bottled water, the bottles that are used are blown and filled at the factory itself, to avoid contamination.
2.5 Purification Process
At BISLERI plants, water undergoes multi - stage purification process to ensure proper blend of minerals and complete removal of microorganisms
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and toxic substances. So a habit of drinking PURE and SAFE BISLERI will ensure a healthy life What advantages Bisleri purification process has over purification done by other methods. Traditional process of boiling water for purification has its limitations. lt is time consuming. For boiling, water has to be heated to 100 deg. Celsius. Also, to kill microbes water should be boiled continuously for a minimum of 20 minutes. Boiling may kill the microbes but can not remove other physical impurities and toxic substances. Many home appliances are available in market for water purification. These gadgets use either % purity of water. Filtration removes only the visible suspended particles and not the minute , invisible particles , toxic substances or microorganisms. The filters are cleaned rarely and all the muck accumulates inside leading to more contamination. Ideally such filters need to be cleaned every day which is cumbersome. Ultra Violate rays kill the microbes but cannot ensure removal of toxic substances and physical impurities. These purification equipment are incomplete and need continuous monitoring and maintenance. At BISLERI, through our multi - stage purification process we ensure removal of toxic substances as well as physical and microbiological impurities. In our state-of-the-art processing plants we follow rigorous Good Manufacturing Practices and strict Quality Assurance norms so each and every bottle of BISLERI is made tasty, pure and safe for the consumer. PROTECT YOUR HEALTH WITH BISLERI WHICH USES 6 STAGES OF PURIFICATION
filtration technique or Ultra Violet rays or a
combination of the two techniques. These techniques do not guarantee 100
CHLORINATION: Kills micro organisms. Remove organic matter.
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ARKAL FILTER: Removes suspended matter and turbidity. CARBON FILTER: Removes residual chlorine &odours REVERSE OSMOSIS: Removes organic material. Controls total dissolved solids in the water.
MICRON FILTRATION: Additional safety measures of filtration. OZONATION: Ensures water remains bacteria free for longer shelf life.
2.6 Product & Packaging
Bisleri is available in a range of sizes. The Bisleri bottled water range comprises the conventional 500 ml, one litre, 1.2 litre and two litre bottles; five litre and 20 litre jars for the home segment, and smaller packs sizes of 250 ml cups and 330 ml bottles, though in very limited numbers for now.
A major, diversified, transitional, integrated consumer product manufacturing company, with National Leadership and a strong environment conscience, playing a national role in safe water and Agro based drinks.
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To provide the highest quality product, keeping in mind all aspects including freshness, purity and safety, and making it easily available to the consumer at a very affordable price. To achieve international standards of excellence in all aspects of energy and diversified business with focus on consumer delight through value and services of product and cost reduction. To enhance capital and fixed assets of the group to withstand challenges and tough market trends. To attain leadership in developing, adopting and assimilating state or art technology for competitive advantage. To provide better quality of product and services through sustained market research and product development. To foster a culture of participation and innovation for employee growth and contribution. To cultivate high standards of business ethics, and total quality management for a strong corporate identity and brand equity with continuous and positive growth. To help enrich the quality of life of all the communities specially the neglected ones and preserve ecological balance and heritage through a strong environment conscience.
2.8 Why Bisleri?
Bisleri is totally safe & protects you from all water borne diseases.
Bisleri is trusted by 50 lakh households across the country.
Bisleri is the brand leader in bottled water category. The water is purified through six stages of purification process that includes reverse osmosis and Ozonation.
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Where Can We Use Bisleri?
Drinking Making tea, coffee, lassi, cold drinks, mixing with drinks Kneading the dough Cooking Mixing with baby foods Mixing with medicines
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2.9 THE JOURNEY TILL NOW
1969: Buys Bisleri bottled water from an Italian company, Felice Bisleri. It was bottled in glass bottles then. Early-1980s: Shifts to PVC bottles. Sales surge Mid-1980s: Switches to PET bottles, which meant more transparency and life for water. 1993: Sells carbonated drink brands like Thums Up, Gold Spot and Limca to Coca-Cola for Rs. 400 crore. 1995: Bisleri launches a 500 ml bottle and sales shoot up by 400 per cent. 2000: Introduces the 20-litre container to bring prices down from Rs 10 a litre to Rs 2 a litre. 1998: Introduces a tamper-proof and tamper-evident seal. 2000: BIS cancels Bisleri's license of water bottling in Delhi since some of the bottles did not carry ISI label; the license is restored one-and-a-half months later. 2002: Kinley overtakes Bisleri. The national retail stores audit by ORG-MARG show Kinley's market share at 35.1 per cent compared to Bisleri's 34.4 per cent. 2003: Bisleri says it plans to venture out into Europe and America to sell bottled water 2004: Water king, Mr. Ramesh Chauhan set to take brand Bisleri across the globe. 2005: Bisleri has announced its plans to foray into the domestic fruit juice market and earmarked an investment of Rs 100 crore for upgradation of its Chittor plant and setting up of a new facility.
2006: Bisleri Natural Mountain water will be available in aqua green packaging against the blue packaging of old and will be available in six sizes. 2007: Parle Bisleri changed the look introduced a new variant (natural mountain water) and announced its plan to launch the brand in US- a huge market for designer waters. 2008: Bisleri International has decided to register the mango drink brand — Maaza — in eastern European countries, and launch the brand through a franchisee operation. 2009: Company plans to concentrate on markets such as Jammu and Kashmir, Kerala, Southern part of Tamil Nadu and Punjab, which are its weaker links to steer a 40% annual growth in sales.
OBJECTIVES OF THE STUDY
To learn about the domestic packaged drinking water market, its market share and Brand Bisleri in detail.
To find about consumers' and retailers' brand preference To see whether there is a threat to the mineral water market from water purifiers and soft drinks. Whether the people of Delhi & its Ncr are happy, paying for water. Whether the people of Delhi & its Ncr are getting health conscious. To find the retailers view on the mineral water market and to assess the future prospect of the market. To find the potential of Mineral water market in Delhi & its Ncr.
3.1 BOTTLED WATER
Consistent quality and taste are two of the principal differences between bottled water and tap water. While bottled water originates from protected sources - largely from underground aquifers and springs - tap water comes mostly from rivers and lakes. Another factor to consider is the distance tap water must travel and what it goes through before it reaches the tap. In compliance with international regulations, bottled water is sealed and packaged in sanitary containers. If a bottled water product is found to be substandard, it can be recalled. This can’t happen in case of tap water. According to regulations in the US, when bottled water is sourced from a community water system the product label must state so clearly. However, if the water is subject to distillation, de ionization or reverse osmosis, it can be categorized that way, and does not have to state on its label that it is from a community water system or from a municipal source. Processing methods such as reverse osmosis remove most chemical and microbiological contaminants.
3.2 THE MANUFACTURING PROCESS
Processing and Quality Assurance • • • • The casing tube itself is protected with stainless steel mesh to give a preliminary filtration to the water. Ultra filtration gives water reduction in turbidity and adds sparkle Activated carbon purifier to remove color and odour in water Reverse osmosis membrane has porosity of less than 0.01 micron the process renders water free of microorganisms and also reduces dissolved solids
To ensure mineral water is held safe free from contamination, ultraviolet treatment and ionization process is carried out. Ozone is unstable trivalent oxygen, a very powerful bactericide with no side effect, as it disintegrates into oxygen within couple of hours. Sterilization effect of ionized water continues even after water is packaged, thereby ensuring safety of Mineral Water up to its final packing. To ensure high quality of packing materials, components like caps and bottles are manufactured in-house from resins of quality suppliers. Good Manufacturing Practices are stringently followed at all times. Processing is religiously monitored at every stage. Testing source water, processing parameters, microbial quality, packaging material integrity and finally, shelf life studies, forms an integral part of quality and safety assurance plan. Labeling The Name of the Product shall be the appropriate terms as defined. Water containing carbon dioxide that emerges from the source and is packaged directly with its entrapped gas or from which the gas is mechanically separated and later reintroduced at a level not higher than naturally occurring in the water, may bear on its label the words naturally carbonated or naturally sparkling. Packaged water which contains carbon dioxide at levels than those naturally occurring in the source of the product shall be labeled with the words carbonated, carbonation added Rules and Regulations The Bureau of Indian Standards (BIS) has just recently got involved in the process. In September 2000, the Government of India made it mandatory for all bottled water companies to get an ISI mark, including imported bottled water brands like Evian and Perrier. The Ministry of Health and Family Welfare had set a deadline of Mar 29, 2001 for complying with the new norms. or sparkling.
3.3 MARKET CATEGORISATION
The market initially had only one SKU of 1 litre this was followed a by a number of smaller and bigger SKUs. Based on these SKUs we can divide the entire market into two segments: • • Retail consumption market Household & Institutional consumption market
Each of these consumption markets have a number of SKUs under it. Some of the most consumed SKUs in retail market are 500ml, 1 litre, 1.2 litre, 1.5 litres, 2 litres, and 5 litres. Recently Bailley has launched 330ml pack targeted against 330ml pack size of soft drinks especially the aluminum-can drinkers. The institution market is largely constituted by the hotel industry, caterers, offices, parties, travel, tourism, hospitals etc. The SKUs that are available in this market are 10 litres and above besides this we have pack size of 250ml plastic cups. The market can also be divided on the basis of the price at which this bottled water is available into three categories: • • • Super premium mineral water Premium local natural mineral water Popular or plain bottled water
Presently, Evian of Danone group; Perrier and San-Pellegrino of Nestle belong to super premium category. Catch, Himalayan, Brilliant etc. belong to premium local natural mineral water category. All other brands like Bisleri, Bailley, Kinley, Aquafina etc. belong to popular or plain bottled water category. The packaged drinking water market is often categorized as per the clients they have: Corporate, Theaters, Gymkhanas, College Canteens, Retail Outlets, Hotels and Restaurants and Occasions.
3.4 INDIA TO FACE SEVERE WATER CRISIS IN THE FUTURE
The per capita water availability in India is projected to decline to about 1,140 cubic meters per year in 2050 from 1820 cubic meters per year recorded in 2001 according to the Intergovernmental Panel on Climate Change (IPCC). "India will see a severe water crisis in 20 years if the government doesn't change its ways and clashes are already taking place because the resource is so scarce." This was the warning by the World Bank way back in 2005. "Estimates reveal that by 2020, India's demand for water will exceed all sources of supply. All these reports point to just one thing for us now. That we should he on serving water and be judicious in its use. If water is wasted today then it is our future generation which will suffer because of it. So everyone needs to make a point from now to save water in any way they can. If we cannot do that then the future is very clear. Water will be one of the most expensive commodities and everyone will have to buy water shelling out huge amount of money for the same. The implications could be worse than these if action is not taken now. Water infrastructure projects should also speed up in the country through public-private partnership. This is of immense importance in a country where rural population has very little access to safe drinking water. What these infrastructure projects will also ensure is employment generation and in the current global crisis the country need to stand up and generate local employment through these opportunities and challenges. The fastest growth in the consumption of bottled water in the world has been recorded in India according to a new study conducted by the US based earth policy institute. It even questions the rising thirst for bottled water with consumption tripling in India over the past five years.
World Bank report
3.5 INDIAN SCENARIO
In 1967, Bisleri set up a bottling plant for manufacturing and marketing its mineral water but that time the concept of mineral water was failed. The brand was later on sold off to Parle group acquired the Bisleri of Italy for launching soda water but later launched bottled water also. The launch at that time was a big flop as concept of buying Water that ton the Indian public did not accept form. The market remained dormant for quite long (for a period of 20 years or so). The market throughout this period was formed only by the premium products that too available through 5-star hotels. In early 1990s with onset of liberalization policy by the Indian government, coming in of cola majors, sell out of local soft drink brands of Campa, Thumb’s Up, Gold Spot etc. by pane to coke and other factors led Bisleri to test waters again. Bisleri re-launched its bottled water in 1994. With exposure of media and exposure to international life styles, deteriorating levels of portable water, increases in a number of water borne classes, increases in awareness about health and hygiene and other related factors led to acceptability of concept of mineral water. The market has not looked back ever since then and has grown leaps and bounds to such an extent that a number of genuine as well as fly-by-night operations have entered it to milk it.
Bottled water slaking consumers thirst.
The Indian bottle water industry has grown phenomenally over the past decade. A major part of the demand stems from out of home consumption by people on the move, because the quality of drinking water available otherwise is suspect. Of course, some also consume bottled water (or high price mineral water in some instance) as a style statement. While it has its positive aspect, the bottle water industry is often questioned for its over-extraction of the ground water. It’s very high cost of delivery and massive generation of solid waste in the form of non-biodegradable plastic bottles is this industry really slaking in consumer's thirst or is it being too expensive and wasteful?
The Big Boom
The bottle water industry has tin-doubted been one of the fastest growing business sectors in India. The way it has grown since the early 1990s is indeed astounding. And the high growth rate is expected to continue into future. Starling from a small base, the growth was exponential up to early years of current century. Thereafter, there was a decline in the pace of growth, and we now witness a comparatively linear growth, but nonetheless fairly rapid. The bottle water industry is reported to have growth nine-fold over the past decade from around 15 million cases in 1997-98 to an estimated 130 million eases in2007-08 (I case=48 liters)this traction to a compounded annual growth rate 24% per annum. In same year, the growth rate has been as high as 40%. The market size is further projected to increase to 265 million cases by the year 2014-15 this works out of a projected growth rate of nearly 11% a year. While one has crossed the exponential growth phase experienced during the industry's nascent period, there is lot of untapped potential and the industry would continue to experience double digit growth rates for several years to come."' In terms of value, the Indian bottled water segment is estimated currently at Rs.3000cr per annum and expected to double within the next seven years. The international players currently see India as the destination with a lot of growth possibility. India is already the tenth largest bottled water consumer in the world. A major part of the demand for bottled water stems from out of home consumption by people on the move, because the quality and safety of drinking water available otherwise is suspected the fear of contracting water-home infection prompts many to go in for bottled water during journey and when one is away from home. Of course, sonic also consume bottled water (or high price mineral water in some instance) as a style statement. In part the industry pews its existence to the poor quality of portable Water supplied by the municipal authorities/water supply boards and further to the inadequate hygienic standard prevalent in most public eating place, where the water served of often contaminated. The demand has been further fueled due to increasing income and changing lifestyle of the urban middle and upper classes of the population. It is also triggered by advertising and wide —spread distribution of the product.
Life Cycle of the Industry
Here 1990 was selected as base year and from 1990 sales in bottled water has increased year by year but not that much level to 2004-05 so this covers under introduction stage of bottled water industry. After increase in awareness among people and known side effects of non purified water, people have moved from tap water to bottled water and this change has increased sales of bottled water in market. Until 1992, the demand for bottled water in India was mostly limited to foreign tourists, corporate meetings, conferences, etc. The introduction of bulk packaging extended the market to new and numerous consumers (Jose Raphel, 1998). In this period firms focus on branding and patenting for maintaining right to produce played an important role.
Advertising express May 2008, pg-55
EXPONENTIAL INCREASE IN DEMAND OF BOTTLED DRINKING WATER: 1990-2015
1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-2000 2000-2001 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2014-15 • Estimated Projects(Prediction)
2.2 2.6 3.5 4.7 6.5 8.5 11.5 15.5 20 26 33 44.5 55.6 68.15 82 97 112.85 129.85 146.8* 164.45* 265* Source:indiastat.com
After 2005-06 bottled water sales increased in market and it showed growing stage of industry, because people started using bottled water for status and for health safety. Now in 2008 bottled water industry grew at a rate of 38% so its sales increased faster as compared to past year so we can say that the industry came under growth stage. Maintaining existing features and adding new features to the product was seen here, broader audience was available for industry product.
In India for instance, the bottled water industry, with more than 100 companies, has a turnover of about US$ 70 million, growing at an average rate of 50% every year. This sector employs 15'000 to 20'000 people in the country (Jose Raphel, 1998).
(Source-4Advertising express May 2008, pg-55)
3.6 Hypothesis to be tested
An assumption taken to be true for the purpose of argument or investigation is called a hypothesis. Following are the two types of hypothesis. Null Hypothesis, Ho – It is an assumption which the researcher tries to disprove, reject or nullify. Alternate Hypothesis, Ha - It is a statement of what a statistical hypothesis test is set up to establish and negate the null hypothesis. Following are the set of hypothesis established to answer various research problems. 1. Frequency of use of mineral water Ho: Larger Proportion of people always use mineral water. Ha: Larger Proportion of people go for an occasional use of mineral water 2. Choice of soft drink over mineral water Ho: People prefer soft drink when thirsty. Ha: People like to have mineral water in a thirst condition. 3. Awareness of all major brands of mineral water Ho: People are aware of all the brands of mineral water. Ha: People are not aware of all the brands of mineral water. 4. Customer preference in terms of bottle sizes Ho: 5 ltr and 20 ltr bottles of mineral water are the most preferred ones, by the population.
Ha: 5 ltr and 10 ltr bottles of mineral water are not preferred by the population. 5. Effect of advertising on purchase Ho: Advertisement doesn’t affect purchase decision of Mineral Water. Ha: Advertisement affects purchase decision of Mineral Water. 6. Size of bottle having higher sales Ho: Selling of 5 ltr& 20 ltr bottles occur more frequently. Ha: Selling of 5 ltr& 20 ltr bottles occur less frequently. 7. Reason for growth during the last five years, according to retailers. Ho: Tremendous growth in mineral water segment is not owing to increased health consciousness and scarcity of portable drinking water amongst the population. Ha: Tremendous growth in mineral water segment is due to increased health consciousness and scarcity of portable drinking water amongst the population.
A research design is purely and simply the framework or plan for a study that guides the collection and analysis of data. The Survey Research was used in this project, because retailer’s and consumers feedback was necessary for obtaining the data. Starting a research project needs a basic preparation regarding the issues related to the topic selected. For this one needs to do some deskwork. Deskwork includes: 1. Determining the basic objectives of the study undertaken. 2. Collection of secondary data related to the topic from Internet, magazines & newspapers.
Studying the market, which one wants to cover. Analyzing the objective on the basis of information collected by secondary data.
5. All the above activities at the initial stage of the project must be completed & then the main part follows.
a) Primary data: These are those data which are collected afresh and for the first time, and thus happen to be original in character. I have used the structured questionnaires. b) Secondary data: These are those which have already been collected by someone else and which have already been passed through the statistical process. I have collected it from the sources like internet, published data etc.
Population of the study
People from Delhi/ NCR region will be included in the population.
I took 100 consumers and 50 retailers as my respondents. They were selected by random sampling method because in this case systematic sampling is not possible since one cannot say whether a person is using mineral water or not.
Random sampling technique will be used in this research project.
4.3 RESEARCH INSTRUMENT
For doing the survey research, structured questionnaire with closed-ended and open–ended questions were used.
Mode of Survey
The mode of survey for the retailers and consumer’s was the filling up of the questionnaires.
Preparing the Questionnaire
As per the requirement of the project & to achieve the objective both consumer of mineral water & retailers of mineral water were studied apart from studying about the domestic packaged drinking water market, Brand Bisleri in detail. For that close and open ended questionnaires for the consumer & for retailer were prepared.
4.4 Data Processing
Daily data will be entered into MS-Excel sheets. After the exhaustion of the specified geographical area this data will be analyzed using simple graphical and tabulation techniques.
After collection of data another work necessary for any data collector is to correctly analysis that data. Statistical tools helped me to correctly analyze the data. I used here the software named Ms
EXCEL for analysis of the data. I used following statistical tools:
Chi-square test will be used when the set of observed frequencies obtained after experimentation have to be supported by hypothesis or theory. The test is known as χ2 test of goodness of fit and is used to test if the deviation between observation (experiment) and hypothesis may be attributed to chance (fluctuations of sampling).χ2also enables us to explain whether or not two attributes are associated or related to each other. To test the goodness of fit: It helps to test goodness of fit by using null and alternate hypothesis.
STATISTICAL TOOLS TO BE USED
1. Chi –Square Test Procedure: (1) Set up the null hypothesis that there is no significant difference between the observed and expected value. (2) We compute the value of CHI- square by using the formula CHI-square = Σ χ2=Σ (( Oi- Ei)2/Ei) O- Observed value E- Expected value Degree of freedoms=(R-1)(C-1) Level of significance=5
4.5 Alignment of primary and secondary data
For the purpose of the market survey, I had designed the research based on primary data. For the collection of primary data, two structured questionnaire for the retailers and the customers were designed. Secondary data will be used to supplement the primary research and in terms of capacity and profile of package drinking water industry. We will try to confirm the facts of secondary data with the primary study related to growth in the industry and Bisleri’s market strategies to be adopted for increasing its sales and brand preference in the market.
ANALYSIS AND INTERPRETATION
CONSUMER RELATED SURVEY
1. WHICH BRAND DO YOU PREFER WHILE BUYING MINERAL
60% 50% 40% 30% 20% 10% 0%
24% 12% 8%
NAME OF BRAND Bisleri- Most Preferred Kinley Aquafina Others
CONSUMER PREFERENCES 56% 24% 12% 8%
According to the survey conducted in Delhi & its Ncr it was analyzed that 56% of the users go for Bisleri Water and 24% for Kinley while there are 8% of the respondents who still go for other packaged drinking water.
2. NUMBER OF RESPONDENTS USING MINERAL WATER FREQUENTLY
According to the survey it was seen that 28% of the users responded as using mineral water always while 27% agreed to use it often. 36% of respondents said they used mineral water sometimes while there are 9% of the respondents who said they never use packaged drinking water. HYPOTHESIS TESTING Step1: State Hypothesis: Ho: Larger Proportion of people always use mineral water.
Ha: Larger Proportion of people go for an occasional use of mineral water.
Step2: State the rejection criterion DF=4-1=3 At alpha .05 and 3 degrees of freedom, the critical value from the chi square distribution table is 7.82. Step 3: Compute the Test Statistics: χ2 = Σ (O-E)^2/E Preference Always Often Sometimes Never Observed 28 27 36 9 Expected 25 25 25 25 (O-E) 3 2 11 -16 (O-E)^2 9 4 121 256 (O-E)^2/E 0.36 0.16 4.84 10.24
As the Chi-square test statistics value 15.6 exceeds the critical value of 7.82 hence null hypothesis is rejected and our alternative hypothesis is accepted. Hence it can be concluded that that 34% of the mineral water users go in for an occasional use while there are still 9% of the respondents who never go for packaged water.
3. RESPONDENTS CHOICE AMONGST MINERAL WATER AND SOFT DRINKS
48% respondents agreed to always choosing mineral water over soft drinks when thirsty while 15% chose it often, 25% agreed to choosing it sometimes while 12% consumers said they never have mineral water when thirsty. HYPOTHESIS TESTING Step1: State Hypothesis: Ho: People prefer soft drink when thirsty.
Ha: People like to have mineral water in a thirst condition.
Step2: state the rejection criterion DF=4-1=3 At alpha .05 and 3 degrees of freedom, the critical value from the chi square distribution table is 7.82. Step 3: Compute the Test Statistics: χ2 = Σ (O-E)^2/E PREFERENCE OBSERVED EXPECTED O-E Always Often Sometimes Never 45 15 25 12 25 25 25 25 20 -10 0 -13 (O-E)^2 (O-E)^2/E 400 100 0 169 16 4 0 6.76
As the Chi-square test statistics value 26.73 exceeds the critical value 7.82 hence null hypothesis is rejected and hence we reached at the result that our alternative hypothesis is accepted. Hence it can be concluded that that 48% of users always go in for mineral water when they are thirsty.
4. BRAND AWARENESS OF MINERAL WATER AMONG RESPONDENTS
Brands 0-2 3-5 6-10
Respondents 40% 50% 10%
10 and above
The survey conducted in showed that 40% of the respondents were aware of 0-2 brands packaged drinking water, 50% of 3-5 brands, 10% were aware of 6-10 brands while none were aware of more than 10 brands. HYPOTHESIS TESTING Step1: State Hypothesis: Ho: People are aware of all the brands of mineral water. Ha: People are not aware of all the brands of mineral water.
Step2: State the rejection criterion DF=4-1=3At alpha .05 and 3 degrees of freedom, the critical value from the chi square distribution table is 7.82. Step 3: Compute the Test Statistics: χ2 = Σ (O-E)^2/E PREFERENCE OBSERVED EXPECTED O-E 0-2 3-5 6-10 10 and above 40 50 10 0 25 25 25 25 15 25 -15 -25 (O-E)^2 (O-E)^2/E 225 625 225 625 9 25 9 25
χ2 =68 Interpretation:
As the Chi-square test statistics value 68 exceeds the critical value of 7.82 hence null hypothesis is rejected and hence we reached at the result that
our alternative hypothesis is accepted. Hence it can be concluded that most of the people know only about the main brands which are owned by the big companies and are advertised hugely. Mainly 3 -5 brands only comes to the minds of the customer in regards to mineral water.
5. CUSTOMER PREFERENCE IN TERMS OF BOTTLE SIZES
SIZE OF BOTTLES PREFERENCES 0.5 ltr 1 ltr 5 ltr 60% 20% 5%
According to the survey 60% of the respondents preferred to buy 500ml bottles, 20% preferred 1ltr bottles while 5%& 15% preferred 5ltr and 20 ltr respectively. HYPOTHESIS TESTING Step1: State Hypothesis: Ho: 5 ltr and 20 ltr bottles of mineral water are the most preferred ones, by the population. Ha: 5 ltr and 10 ltr bottles of mineral water are not preferred by the population . Step2: state the rejection criterion DF=4-1=3 At alpha .05 and 3 degrees of freedom, the critical value from the chi square distribution table is 7.82 Step 3: Compute the Test Statistics: χ2 = Σ (O-E)^2/E PREFERENCE OBSERVED EXPECTED O-E 0.5 ltr 1 ltr 5 ltr 20 ltr 60 20 5 15 25 25 25 25 35 -5 -20 -10 (O-E)^2 (O-E)^2/E 1225 25 400 100 49 1 16 4
χ2 =70 Interpretation:
As the Chi-square test statistics value 70 exceeds the critical value of 7.82 hence null hypothesis is rejected and hence we reached at the result that our alternative hypothesis is accepted. Hence it can be concluded that that the 5 Ltr. and 20 Ltr. bottles are usually preferred only during special occasions such as marriage and Birthday parties. Otherwise the 1 ltr and 500 ml bottles are the most preferred once.
6. CUSTOMERS PREFERENCES REGARDING PRICE OF MINERAL WATER
Respondent’s view % of Respondent’s
The observation shows that most of the people are not happy paying the price, the companies are charging for the product. They feel that the price should be a little lower.
7. AFFECT OF ADVERTISING ON PURCHASE
Strongly Agree Agree Strongly Disagree Disagree Indifferent
% of respondents
10% 46% 14% 25% 5%
46% agreed to the fact that advertising of packaged drinking water affected their purchase while 10% strongly agree, 25% of the respondents disagreed, 14% strongly disagreed, while 5% consumers said they were indifferent towards it. HYPOTHESIS TESTING Step1: State Hypothesis: Ho: Advertisement doesn’t affect purchase decision of Mineral Water. Ha: Advertisement affects purchase decision of Mineral Water. Step 2: Set the Rejection criteria: DF = 5-1 = 4 At alpha .05 and 4 degrees of freedom, the critical value from the chi square distribution table is 9.49 Step 3: Compute the Test Statistics: χ2 = Σ (O-E)^2/E Preference Observed Strongly 10 agree Agree Strongly disagree Disagree Indifferent 46 14 25 5 Expected 20 20 20 20 20 (O-E) -10 26 -6 5 -15 (O-E)^2 100 676 36 25 225 (O-E)^2/E 5 33.8 1.8 1.25 11.25
As the Chi-square test statistics 53.1 exceeds the critical value of 9.49 hence null hypothesis is rejected and hence we reached at the result that our alternative hypothesis is accepted. Hence it can be concluded that advertisements affect purchase decision of Mineral Water.
8. AVAILABILITY OF PACKAGED WATER BRAND OF YOUR CHOICE
% of respondents
No Can’t say
It was seen in the survey that 51% said that their choice of mineral water was readily available everywhere, whereas 47% disagreed and 2% were not sure.
9. GROWING HEALTH CONSCIOUSNESSAMONG INDIANS
The observation shows that most of the population in Delhi & its NCR agree that Indian are getting Health Conscious now-a-days
10.PREFERENCE FOR MINERAL/PACKAGED WATER OVER NORMAL WATER BECAUSE OF HYGIENE
The reason for the higher preference for Mineral water considering hygiene important may be the fact that the normal water which we get is not always very hygienic and may cause many diseases, also the increase in the awareness of being fit and people becoming health conscious.
RETAILER RELATED OBSERVATIONS AND FINDINGS 1. TYPES OF BRANDS RETAILERS KEEP
According to survey, 35% of retailer go in for advertised products and nonadvertised products do not have any weight Around 60% retailer believe in the combination of both (advertised and non-advertised version).
2. BRAND MOSTLY SOLD
NAME OF BRAND Bisleri Kinley Aquafina Others
% OF RETAILERS AGREEIN 62% 26% 4% 8%
According to the survey of retailers 62% said the most sold brand was Bisleri followed by Kinley to which 26% agreed while 4% said that Aquafina was sold most and 8% voted for other brands.
3. SIZE OF BOTTLE SELLING MORE
Size of bottle % of respondents
0.5 ltr 60%
1 ltr 28%
5 ltr 4%
20 ltr 12%
According to the survey of retailers 60% said that 500ml bottles were sold most followed by 1ltr as said by 28% while 4% and 12% said 5lts & 20ltr were sold the most. HYPOTHESIS TESTING Step1: State Hypothesis: Ho: Selling of 5 ltr& 20 ltr bottles occur more frequently. Ha: Selling of 5 ltr& 20 ltr bottles occur less frequently.
Step 2: Set the Rejection criteria: DF = 4-1 = 3 At alpha .05 and 3 degrees of freedom, the critical value from the chi square distribution table is 7.82
Step 3: Compute the Test Statistics: χ² = Σ (O-E)^2/E Preference 0.5 ltr 1 ltr 5 ltr 20 ltr Observed 30 14 5 6 Expected 12 12 12 12 (O-E) 18 2 -7 6 (O-E)^2 324 4 49 36 χ 2=3 1.08 Interpretation As the Chi-square test statistics 31.08 exceeds the critical value of 7.82 hence null hypothesis is rejected and hence we reached at the result that our alternative hypothesis is accepted. Hence it can be concluded that both 0.5 Ltr and 1 Ltr version are selling well but 5 Itr are selling less as compared to others. (O-E)^2/E 27 0.33 0.75 3
4. Basis of selling a particular Packaged Drinking Water Brand
Demand by the customer Schemes offered by the companies Advertisement More margins Others
% of Respondents
48% 10% 14% 26% 2%
Mostly the demand by the customer is the main reason for selling of particular brand of Packaged Drinking Water and then it comes to schemes, advertisements and margins. The other reasons included availability, replacement of leaked bottles etc. HYPOTHESIS TESTING Step1: State Hypothesis: Ho: Demand of the customer is not the main reason for selling of a particular brand of packaged drinking water.
Ha: Demand of the customer is the main reason for selling of a particular brand of packaged drinking water. Step 2: Set the Rejection criteria: DF = 5-1 = 4 At alpha .05 and 4 degrees of freedom, the critical value from the chi square distribution table is 9.49 Step 3: Compute the Test Statistics: χ² = Σ (O-E)^2/E Preference Demand by the customer Schemes offered by the companies Advertisement 7 More margins 13 Others 1 10 10 10 -3 3 -9 9 9 81 χ 2=3 2.00 Interpretation As the Chi-square test statistics 32 which exceeds the critical value of 9.49 hence null hypothesis is rejected and hence we reached at the result that our alternative hypothesis is accepted. Hence it can be concluded that demand of the customer is the main reason for selling of a particular brand of packaged drinking water. 0.9 0.9 8.1 Observed 24 5 Expected (O-E) 10 14 10 5 (O-E)^2 196 25 (O-E)^2/E 19.6 2.5
5. MORE MARGINS ON SELLING BRAND
Brand (with maximum margins)
Bisleri Kinley Aquafina Others
% of respondents
40% 28% 11% 21%
Among the 50 retailers that took part in the survey 40% said that they earn maximum margins on Bisleri while 28% said Kinley and 11%& 21% said Aquafina and others respectively.
6. GROWTH DURING THE LAST FIVE YEARS
ACCORDING TO RETAILERS
Health consciousness 38%
Scarcity of water 25%
According to the retailers the growth rate has been very high as 38% think that the population has become health conscious, 32% say it is due to scarcity of drinking water and 25% say it is due to increased advertisements while 5% say that there may be other reasons like higher living standars, more disposable income etc. HYPOTHESIS TESTING Step1: State Hypothesis: Ho: Tremendous growth in mineral water segment is not owing to increased health consciousness and scarcity of portable drinking water amongst the population.
Ha: Tremendous growth in mineral water segment is due to increased health consciousness and scarcity of portable drinking water amongst the population.
Step2: state the rejection criterion DF=4-1=3 At alpha .05 and 3 degrees of freedom, the critical value from the chi square distribution table is 7.82. Step 3: Compute the Test Statistics: χ² = Σ (O-E)^2/E Preference Health Consciousness Advertisement Scarcity of portable drinking water Others χ 2 =108.7 5 12 -7 49 4.08 Observed 38 32 25 Expected 12 12 12 (O-E) 26 20 13 (O-E)^2 679 400 169 (O-E)^2/E 56.33 33.33 14.33
As the Chi-square test statistics value 108.07 exceeds the critical value of 7.82 hence null hypothesis is rejected and hence we reached at the result that our alternate hypothesis is accepted. Hence it can be concluded that Last five year seen a tremendous growth in the mineral water segment. The growth rate has been very high, owing to increased health consciousness amongst the population, arising from scarcity of potable drinking water.
7. FUTURE PROSPECTS OF MINERAL WATER MARKET
% of retailers
40% of the total respondents said that the future prospects of the mineral water industry is excellent, 30% said it was good while 16% gave it an average & 12% said it had a poor future.
SWOT ANALYSIS OF BISLERI
Core business of company. First mover in this business since 1969. Good brand awareness and brand positioning. Available in different packs like cups, 500 ml, 1 lit, 1.2 lit, 2 lit, 5 lit and 20 lit. Has become generic name in the mineral water market. Availability of Bisleri in all over India with solid infrastructure facility. Focus on customer orientation through low price strategy. Product differentiation by introducing patented break way seal cap. Best service and proper response to dealers and customers.
Lack of brand loyalty as MNC's are entering the market like Nestlé’s Purelife, Pepsi's Aquafina. Lack of Global Awareness in brand. Lack of proper advertising to create brand awareness.
Market coverage is not fully utilized. Institutional sales are not penetrated properly. Lack of technological up gradation.
Indian bottled water industry is still at growth stage. Influence of tourists and expatriates. Bisleri as a daughter company of Parle has a strong presence in India. Unreliable municipal water quality. People are becoming health conscious.
Numbers of players like Kinley and other local players are present in the market have already captured the market. Tough competition from MNC's like Coke & Pepsi. Fluctuation in sales due to seasonality. Local manufacturers who refill used bottle Hampers the image of the industry. Water filters and soft drink industry is a major threat to industry. Coke and Pepsi are already having strong distribution network in bottle water industry with their own fleet of trucks & vans.
Government failure to provide safe drinking water. Laws encouraging ground water exploration.
Developing Economy. Better infrastructure:
Scarcity of water. Health conscious people.
Population growth rate.
Economies of scale
DISCUSSIONS OF STUDY
100 consumers & 50 retailers were identified in some of major areas in the city for conducting the survey. FOLLOWING FINDINGS.... Brand awareness of the customers is mainly more about the top, more publicized brands which they also brought more. INFERENCES WERE DRAWN FROM THE
Initially we enquired about the numbers of brands that the retailers sell and most of them specified not more than 3 - 4. This indicates that the retailers prefer only the main brands.
Most of the retailers usually keep highly advertised brands. Here two basic questions as to which brands are selling more and which one is being supplied more were combined. The answer was obvious and i.e., the one which is sold more is supplied more and it is 'Bisleri' (in most cases). 51% of respondents said that their preferred brand was readily available everywhere which is 5% lower to that of the people who said that their preferred brand is Bisleri which means that there is a probability that some consumers are not able to readily find Bisleri always. Mostly the demand by the customer is the main reason for selling of particular brand of packaged drinking water by a retailer but there were considerable number of retailers who said higher margins was also one of the deciding factors. It was a mixed reaction of the retailers when asked about the highest margin paid to them by a company out of the total 50, majority said that Bisleri paid the highest. Consumer’s answer to which size of bottle they prefer was 500ml and 1ltr bottles. The retailers' answers as to which size of bottle is selling more were inclined towards the 1 ltr and 500 ml bottles with certain exceptions.
Majority consumers also agreed that advertisements affected their purchase decision of a particular packaged drinking water brand. With the increasing heath consciousness of the consumers they prefer packaged drinking water more to tap water due to hygienic considerations. Regarding the growth and future prospect of the mineral water market nearly all of the retailers were optimistic and ranked it as a very rapidly growing excellent market.
RECOMMENDATION AND SUGGESTIONS FOR BISLERI
Bisleri should spend more on sales promotions to reinforce its
brand image in the market. Campaign, stalls to beat local brands & create awareness. industries as they are the emerging sector. New Market segments Retailers need to concentrate on 5 and 20 ltr bottle which can be possible only if properly advertised & home delivery of jars is done to the end customers. The market is too congested and confused in the Delhi & its Ncr region, so the company should properly promote & strengthen the distribution channel to survive the competition.
They can tie up with large commercial complex, hotels & airlines
Can enter into premium segment market. It can also explore international markets specially developing market
They can target the youth segment. Launching trendy packs to attract more and more customers. In Bottled water industry people purchase those products which are easily available in market So transportation is key activity for bottled water industry. Hence development of transportation is important.
Action plan for covering the sample population: There are four major segments selected for the jar and dispenser business which Bisleri should focus to have better availability of its product:
confectioneries Ice cream parlors, bars, and catering services.
Institutional sales: Factories, Export house, School& Education institution and hospitals. Offices & Households: Commercial complexes, main market, residential flats & housings colonies. Retail segment: All Panwalas, general store, and Juice & Ice cream parlors.
As the future of the industry is very bright if is important to leverage this growth by Investing in Research and development.
Looking out for product differentiation.
After analysis of the data & facts we have collected from consumer & the retailers & matching them with the objectives one can say that there is very good future for mineral water market. Soft drink market might be some threat to the mineral water at present but within few years the scenario is going to change. Trend signifying increasing health consciousness amongst Indians could also be observed. Market has seen a tremendous growth from the early nineties & now it is increasing by 40% every year so one can easily say there is great potential in the mineral water market. It could also be observed that the living standards of the people improving & as they are becoming health conscious are ready to pay for water now. On the question of survival of so many companies government has made policies & restrictions from April 2001 which will force many manufactures to shut down their factories. But due to potential in the market companies with quality product will survive.
Finally from the data collected at both primary and secondary level one can confidently say that Bisleri as packaged water brand is the current market leader.
LIMITATIONS OF THE STUDY
Any research or study always has some limitations under which this has to be undertaken. This one too was not an exception. These limitations are poised by the environment some external and some inherent. This study has been conducted with utmost consideration to the adequacy of data and quality of information, though as mention earlier the reliance on the sources cannot be minimized to zero in context of precision. The limitation can be enlisted as hereunder:1.
The perception level of the respondents. The responses given by respondents were not always accurate because the respondents gave the response according to their understanding.
2. Availability of documents as sources of secondary information. 3. Reliability of information collected from various public information sources such as magazines and website. 4. Respondents are not willing to fill the questionnaire. 5. Very often the respondent do not express their true feelings, in such case their habit, preference, practice, cannot be assessed correctly. 6. Some of the respondents refuse to give the important information best known to them. 7. Time was a limiting factor for the study 8. Cost and coverage of survey area However in spite of these limitations all efforts have been put to make the report correct, genuine, and fulfilling the objectives of the reports.
BOOKS & JOURNALS–
Kotler Philip, “Marketing Management” New Delhi, Prentice Hall of India, 2003(9th edition) Kothari C.R, “Research Methodology” New Delhi,
VishwaPrakash, 2003(2nd edition). S H.W. Boyd, R. Westfall and S.F. Stasch, “Marketing ResearchText and Cases” (7th Edition) Britannica Encyclopedia
Mr. Hari Sundar(2008), “Indian Packaged drinking water industry”, Advertising Express page no-55 Jaspreet Bhasin Chandok (2003), “Strategies for Survival of Indian FMCGs” Journal of Retailing Vol. 68,Pg 34 Catherine Ferrier(2001), “Bottled water: Understanding a social phenomenon” , WWF Reports
Magazines • •
en.wikipedia.org/wiki/Bisleri www.finewaters.com/Bottled_Water/India/Bisleri.asp www.bisleri.com/ www.bottledwaterindia.web
Name of the respondent __________________________
Address of the respondent __________________________ Contact no. ________________________________________
Ql. How often do you consume mineral water? a) Always c) Often b) Sometimes d) Never
Q2. When feeling thirsty you opt for Mineral water over Soft drink, juices etc a) Always c) Often b) Sometimes d) Never
Q3. How many brands of mineral water are you aware of?
a) 0-2 c) 6-10
b) 3-5 d) 10 and above
Q4. Is your preferred brand of mineral water easily available? a) Yes b) No
Q5. Which size of bottle do you prefer?
500 ml c) 5 Itr
b) 1 ltr. d) 20 Itr
Q6. Do you think mineral water is much more hygienic than normal water? a) Yes b)No
Q7. Do you think the price the companies are charging, is worth the product? a) Yes b) No
Q8. Does advertising of this product has any effect on your purchase? a) Yes b) No
Q9. Do you think Indians are getting more health conscious day by day? a) Yes b) No
Q10. Which brand do you prefer while buying mineral water? a) Bisleri c) Aquafina b) Kinley d) other
Name of the respondent ___________________________ Address of the respondent _________________________ Contact no. ______________________________________
Q1. How many brands of mineral water do you sell (specify)? a) 2-3 c) More ___________ Q2. What types of brands do you have? a) Advertised b) Non-Advertised b)3-5
c) Both Q3. Which brand is selling more? a) Bisleri c) Kinley b) Aquafina d) Others
Q4. Which size of bottle is selling more? a) 500 ml
b) 1 ltr d) 20 Itr
Q5. What is your basis of keeping a particular Packaged Drinking Water Brands at your shop? a) Demand by the customer b) Schemes offered by the companies c) Advertisement d) More margins e) Others ______________
Q6. On which brand do you get more margins? a) Bisleri c) Kinley b) Aquafina d) Others
Q6. Do you feel there is growth in the mineral water market in the last 5 years? a) Yes b) No
Q7. If answer to above question is yes, then what do you think is the reason for this growth? a) Increase in Health consciousness of people b) Increase in Advertisements c) Scarcity of drinking water d) Others Q8. What is the future prospect of this market? a) Excellent c) Average b) Good d) Poor