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Growing market: Bottled water on sale at Connaught Place, New Delhi. Rajeev Dabral / Mint

Growing market: Bottled water on sale at Connaught Place, New Delhi. Rajeev Dabral / Mint

Covid-19 may drive the demand for hydration brands

Action is heating up in the branded water segment with startups springing up to launch new products on health planks

Action is heating up in the branded water segment with startups springing up to launch new products on health planks. They are taking pains to differentiate themselves from the regular packaged water category, which seems to be growing at a fast clip. According to data from research and analytics firm Euromonitor, the bottled water segment has been growing at 18-19% year-on-year in India. The country is estimated to consume 11,153.3 million litre of bottled water in 2020.

Unfortunately, there are no numbers available for the value-added water category. Yet, there are firms betting on marketing nutrient-induced or natural spring water to cash in on the new wave of healthy living. While the value-added or flavoured water segment is not new as brands such as O’cean and Wild have been around for several years, startups are thirsty for a share in the category which they feel can only expand.

Gujarat-based Aakash Vaghela set up AV Organics in 2018 to launch Evocus H2O, a new-age, black alkaline bottled water brand. The germ of his business idea lay in his passion for fitness and interest in sports. Vaghela’s research on hydration led him to scientist Nobert Chirase in the US who is now advising on the product. The company sources and refines the core minerals in the US, and infuses them in the water at Vaghela’s Vadodara plant. “If covid-19 hadn’t hit us, AV Organics would have been profitable," said Vaghela. The black-coloured alkaline water was first launched in June 2019 in Chandigarh and Pune. “We launched before covid-19 as we noticed a health revolution in the country. With covid, that revolution is being fast-forwarded. Our target consumer is the mid- to high-income urban, health-conscious individual," he said.

Before the pandemic, the alkaline water was available in modern trade outlets, such as Modern Bazar, 24 Seven, Nilgiris and Le Marche, but post-covid, the company is banking on forging relationships with online sales and delivery partners such as Dunzo, Amazon, Big Basket and Grofers.

Vaghela’s R&D team is working on three more products—all in the innovative, multifunctional foods and beverages segment. To justify his foray, Vaghela noted that India’s health and wellness market stands at $25 billion, out of which the functional foods and beverages segment is worth $7 billion. This is expected to grow at a compounded annual growth rate (CAGR) of 22% over the next five years. Premium packaged water will also touch a 22% CAGR. “We sit at the intersection of premium water and nutritional drink," he said, stressing the potential for his brand.

Two years ago, Coca-Cola introduced its global premium water brand Glaceau Smartwater in India. Coca-Cola India did not respond to Mint’s queries, but according to information available on the company’s website, Smartwater, made through the vapour distillation process, is re-mineralized with electrolytes—potassium, calcium and magnesium. The brand is available in all the metros, besides Goa, Pune and Chandigarh.

Right in the middle of the pandemic, on 5 June, homegrown spring water brand Responsible Whatr was launched by Ankur Chawla and his partner Bhrigu Seth. Sourced from a mountain spring in Himachal Pradesh, the water contains natural minerals. “It’s neither processed nor has additives," said Chawla, a sommelier by profession having managed food and beverages portfolios at many big hospitality chains. Chawla, who has launched water only in recyclable aluminium cans, admitted that his business plan was based on servicing the hotels, restaurants, cafes (HORECA) segment, which crashed due to the pandemic. He quickly pivoted to target the B2C segment through online channels. He’s now eyeing sparkling water both for India and the export market.

Value-added water, companies claim, improves the quality of hydration, flushes out toxins, aids digestion and metabolism. These are promises which consumers – in search of health and immunity – are likely to latch on to. Vivek Gupta, managing director (Mumbai market), Ipsos India, who has done studies on fortified water for clients in RO/water purification space, said it usually gets a strong positive response from consumers. Its appeal has got reinforced during covid, but whether it’s sustainable will depend on relevance and building credibility, since trust is a critical factor for water, Gupta added.

Shuchi Bansal is Mint’s media, marketing and advertising editor. Ordinary Post will look at pressing issues related to all three. Or just fun stuff.

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