Can Water be Smart? - Coca Cola Smartwater

Ever since I started observing the packaged water industry, I was pretty amused by the whole idea of packaged drinking water. What is in the water? Who cares about a brand? What is so special in bottled water? It quenches your thirst as usual. Are we concerned about pH factor or the presence of minerals? How can we find a difference between brands? Is it worth spending time for choice? I presume even the people in the industry also may agree with me for instance. But how long companies can survive without differentiation? Apparently, a shift is visible now. A few attempts are done by the giants in the industry like Bisleri, Pepsi Co’s Aquafina, TBL, and Coke.

The packaged drinking water market is an Rs. 14,000 crore market with a CAGR of 20%. A vast majority of the market (approx. 65%) is in the unorganized cottage industry that too comes in around 3000 labels. Bisleri is the pioneer in the industry and the key player has democratized bottled water when potable drinking water was the need of the hour. Interestingly, over the years all the players in the market are operating at the same price point which makes differentiation hardly possible.

However, here comes time for water to be more than water. Coke with their launch of new product in the category Coke SmartWater is trying to differentiate from the clutter. A per Coca Cola, Smartwater is vapor – distilled and re-mineralized with electrolytes- potassium, calcium, and magnesium which gives water a distinctive pure and crisp taste. An innovation inspired by nature. The product is exciting. It perfectly fits with the portfolio. But the challenge is in gaining traction in the high price-sensitive Indian market. Moreover, Bisleri and TBL are already in this segment with Vedica and Himalayan respectively.

When we talk about STP, it is obvious that the product is premium. It largely appeals to Urban Tier 1 consumers. While the USP of competitors is ‘naturally sourced water’, SmartWater uniqueness is in the manufacturing process 'the way clouds are made'. In a market where consumer consciousness on quality is still low, will the consumer appreciate this USP? Only time has to say. However, I strongly believe that the brand name is catchy. The name SmartWater can induce curiosity among the people and can attract the tech-savvy youth of today.

To me what makes the brand unique is the brand communication. They have become the industry first to rope in celebrity endorsers for bottled water. They have used Radhika Apte and Rana Daggubati in their black and white (read classic) ad films for SmartWater. Through the campaign, coke has tried to make it is a lifestyle choice, a frame of mind and an attitude of seeking the best. The ads I think can definitely induce trial in an aspirational buyer.

The fate of the brand is certain. It can’t bring numbers at least for a few years. You can’t expect also. But having such a product in the portfolio can certainly enhance the brand image.