Aquafina: Brand Over-view

Parent brand PepsiCo has a presence in over 200 countries. The company has the largest market share in the US beverage at 39%, and snack food market at 25%. Such brand dominance insures loyalty and repetitive sales. Reported cash flow from operations in 2010 was $8.4 billion, up 24 percent from the previous year. Pepsicos packaged water brand Aquafina was first launched in the US in 1994. 1999: Aquafinas India journey began with its launch in Bombay and it was rolled out nationally by 2000. Bottled across India in 19 plants, Aquafina is available across more than half a million outlets. Catering to diverse consumer needs and occasions, it is available in various pack sizes like 300ml, 500ml, 1 ltr and 2 ltr bottles and in bulk water jars of 25 ltrs. Pepsi set up a state-of-the-art bottling plant in Roha, Maharashtra. The company had invested over Rs. 50 million in the new Aquafina water project. Aquafina had been launched in 750 ml bottles and was priced at Rs. 10. 2003: Launched bulk water jars in aliance with Beltek. Pepsi struck a deal with Delhi-based bottled water manufacturer Beltek Foods under which the company (Beltek) pulled out its Prime bulk water brand from the market and transfered its institutional business to Pepsi. The deal marks Pepsi's foray into bulk water which gives the soft- drinks company a readymade business of about five lakh 20-litre jars in a year. Priced at Rs 65.

Overview: Cont
With this launch, Aquafina also introduced Gold Standard direct-tohome model in the country. Pepsi brought a service to the consumers doorstep with AquaMan - a delivery man . Aquafina Jars were delivered through vinyl-branded, hygienic trucks displaying contact details of the electronic call centre for potential consumers. The widely advertised, high-tech call centre would receive consumer orders, and the state-of-the-art IT system would ensure prompt response and speedy order turnaround. Each delivery man was equipped with a handheld electronic equipment to record every transaction 2003: Pesticide issues clouds purity of the bottled water industry. Key players like Bisleri, Aquafina and Kinely were constantly in a legal tussle, regarding not matching standrads pertaining to puriication of water. 2008: After labeling all its products with a quality seal in 2007 to put the pesticide row behind it, PepsiCo India replaced all existing packs of Aquafina, its packaged waterbrand, with new labels. The labels announced that by next year, PepsiCo India will be a positive water balance company. In other words, the company says it will save and replenish more water in its plants and communities than the total water it uses in the country. 2008: The Supreme court had directed Pespsico to remove pictures of snow capped mountain from the label of Aquafina and to use words as per BIS guidelines. The case is still on-going.

2009: With an aim to scale up volume in the bottled water segment, beverages giant Pepsi decided to roll out its Aquafina brand in small pack of 300 ml priced at Rs 5. After test marketing in Mumbai, Pepsi is now looking to launch the small-sized bottled water in other cities too. 2009: PepsiCo decided to invest another $110 million taking the total annual investment to $220 million. This will go into bottling capacity, marketplace infrastructure investment, innovation and R&D and sustainability projects. PepsiCo will invest $170 million and bottlers $50 million. India is the first country in the PepsiCo universe where a corporate sustainability initiative is being communicated to consumers through a product pack. The Aquafina pack labelling is a public declaration of PepsiCos commitment to positive water balance.

Aquafina global range

PepsiCo produces several other products under the Aquafina label: Aquafina Sparkling carbonated flavored water, available in berry Blast (Raspberry), and Citrus Twist. Aquafina Flavor Splash, flavored water (without carbonation), and artificially sweetened with Scurrilous, available inGrape,Citrus Blend, Wild Berry, and Raspberry. Aquafina Alive, a low calorie, vitamin-enhanced water beverage, available in Berry Pomegranate, Peach Mango and Orange Lime. Aquafina plus+, a low calorie (120 calories per 591mL bottle), vitamin supplement water beverage available in "Blackberry Grape","Pomegranate Cherry","Passionfruit Citrus" and "Orange Tangeri.
Aquafina in the United States is an official sponsor of Olympus Fashion Week, Sundance Film Festival, Tribeca Film Festival, Carolina Panthers, and the PGA.

SWOT Analysis
Strengths:
Strong global brand: Stemming from the Pepsico brand, Aquafina is a brand available across the globe. It does have a strong brand affinity for consumers to fall back on. As of 2009, Aquafina represented 13.4 percent of domestic bottled water sales in the United States, making it the number 1 bottled water brand as measured by retail sales. Distribution reach: Can drive growth and distribution reach on the back on pepsis packaged food + aerated beverage business. Market-Share: Aquafina has been successful in winning market share over Kinley. Altough in 2002, Kinley sold more water cases compared to Aqufina and making the brand second in terms of market-share. But as of 2008,the brand has managed to garner 13.5 % market share ahead of Kinleys 8.8 %.

Strengths
Eco-friendly PET packaging: In a global initiative called Lightweighting the PET bottle of Aquafina, has considerably reduced the usage of plastic. The weight of Aquafina bottles was reduced by approximately 50 percent, to 10.9 grams (0.38 oz), with a packaging redesign in 2009 which, according to the company, resulted in the use of 75 millionfewer pounds of plastic during the production process.In India Auqfina has reduced 12% of its initial weight. For every gram reduced the company saves 10 paise. Campaigns: The What a Body campaign has helped the brand to drive premium, modern and youthful imagery in an otherwise undifferentiated category.
Availability: Present under different price and size points, making the product more accessible to consumers. It has a significant presence in the instituional business too.

Weakness
Threat to brand image: Pepsis pesticide issue did hamper its packaged water business. So the focus remains on positioning the brand as pure, clear. Legal tussles over branding: In 2008-09 The Supreme Court admitted the petitions of beverage major Pepsico and the Bureau of Indian Standards (BIS) who are in dispute over the use of words like "pure", "crisp", "refreshing" and "purity guaranteed" on the former's packaged drinking water Aquafina. In November 2008, the court had directedPespsico to remove pictures of snow capped mountain from the label of Aquafina and to use words as per BIS guidelines.

Threat
Competition from brands such as Coca-Colas Kinley and Parle Bisleri has led to price war between the three brands. Pending court case against usage of imagery over its bottle. This could potentially harm brand-image and force the company to change the packaging all-together at a high-cost.

JV Tata Global Bev and Pepsico Nourishco

The proposed joint venture between Tata Global Beverages (TGB) and PepsiCo, announced in April 2010, will develop beverages in the health and wellness space, is likely to begin with developing affordable water. Discussions are on for the possibility of pricing a one-litre bottle of water below Rs 10, perhaps even around Rs 5. The joint venture may also offer fortified water and low-priced beverages in the earth and wellness space to attract health-conscious customers. PepsiCo is working on a new low-cost distribution system to push its under Rs 5 products.