Images of crisp clean water trickling down through the Alps reinforce classic visions of Swiss water quality — with some believing that you can drink right from the local rivers.
But is this widely accepted perception really in line with consumer attitudes and purchasing patterns? And if consumers really find Swiss tap water the best there is, where can manufacturers and retailers find opportunities within the water category?
For a deeper view in growth opportunities, we investigated the attitudes and opinions on drinking water within our Swiss consumer panel Study on water.
VERDICT: TRUST IN SWISS TAP WATER IS HIGH
Our initial results were unsurprising: Swiss consumers have a general trust in tap water — with almost two-thirds believing tap water is not contaminated with harmful substances, and 70% believing that tap water is just as healthy as purchased mineral water. Furthermore, over 80% of tap water drinkers do not feel it’s necessary to filter tap water — and that they can drink straight from the tap.
MONEY AND ENVIRONMENT: DRIVING FACTORS FOR SWISS WATER CONSUMPTION
But what really drives water purchasing behaviors are 1) the possibility of saving money, 2) the feeling of protecting the environment and 3) trust in their preferred water brand. With 83% of Swiss consumers feeling that drinking tap water is a great way to save money, over 70% also feel that drinking tap water is a great way to protect the environment.
WATER CARBONATORS: REACHING A TIPPING POINT
Holding a middle ground between regular tap water and bottled mineral water, water carbonators have been wildly popular in Switzerland in recent years. With about a third of Swiss consumers carbonating their tap water at home, turnover on the category of “beverage preparation utensils” has increased by 25% in the past year.
And while loyalty on these products for current users is high, with 45% stating that they carbonate their water every day and two thirds several times a week, our research shows that the sales of these devices could slow down in coming years. Only 3% of the Swiss who don’t have a carbonated water maker plan to buy one in the next 12 months, and 83% don’t feel they need such a device.
GROWING YOUR WATER BUSINESS AMIDST CONSUMER PERCEPTIONS
So faced with the undeniable arguments that tap water is both cheaper than bottled water and better for the environment, and knowing that the sales of water carbonators could be slowing, how do companies in the water business strategize for the future?
First off, retailers should take into consideration that future growth in the water carbonating business will lie more with gas rather than the actual machines. Using market research to inform your next growth strategies should be an essential part of your business.
Secondly, mineral water producers, understanding now that the peak of consumers carbonating water themselves has been reached, can look at ways to compete for some of these disloyal consumers. To help with this, we lay out a few strategies to help manufacturers grow:
- PRICING: Though mineral water producers can hardly compete with free, they can be innovative with their pricing strategy. 67% of Swiss consumers always or often can be tempted to switch from their favorite brands or products when they find another brand that’s a better value for money and 65% will switch as a result of price promotions or reductions. Understanding a products’ regular and promotional price elasticities is critical to identifying the optimal pricing point for their brand — and their competition.
- SUSTAINABILITY: Water manufacturers can and are leading the way in looking for alternatives to polyethylene terephthalate (PET) plastic. While PET bottles can only be used a few times before degrading, high-quality alternatives are currently being developed — with smart manufacturers teaming up to lead the way. Taking a leadership role in the development of such materials not only helps solve for this important issue — it also builds trust of your company with consumers. With 41% of Swiss consumers saying they would try a new brand or product from a socially responsible brand, companies can do well by doing good.
- TRUST: 47% of Swiss consumers would try a new product or switch brands if they felt the new brand was well known or trusted. Mineral water consumers need to ensure they protect and maintain their consumers’ trust — otherwise they’ll lose consumer loyalty.
Lastly, producers of water carbonators should dial up the financial and environmental benefits of carbonating water at home. For the loyal consumers purchasing these products, these factors will be driving factors in keeping consumers loyal for years to come.
Interested in the full study on Swiss Consumer Preferences on Water? Contact us.