Great thirst for bottled water market

The domination of Vietnam’s bottled water market by  foreign brands such as La Vie and Aquafina is detailed in new marketing studies that also hint of more development potential.

The market’s value could reach $300 million by 2014, according to UK-based market research firm ADatamonitor.

Meanwhile, a survey of Vietnam’s six leading cities conducted by the global market research firm Nielsen shows that the bottled water market had picked up 23 per cent year-on-year in 2012.

The surveyed cities, accounting for 60 per cent of Vietnam’s total market share, showed stable growth with more than 20 per cent hike in Hanoi and 30 per cent hike in Ho Chi Minh City.

“Foreign players still hold the upper hand in Vietnam’s bottled water market currently. Pepsi’s Aquafina is on top of the market seizing 40 per cent of the total market share, closely followed by La Vie with 30 per cent of the market share,” said Nielsen Vietnam’s Customer Services director Nguyen Huong Quynh.

The research showed that 70-80 per cent of bottled water market share was corralled by foreign players with local companies just holding a modest slice.

Foreign players, however, are investing more in Vietnam. Coca-Cola, which owns the Dasani bottled water brand, recently announced adding its $300 million investment plan to the Vietnamese market.

“The investment will mostly channel into building new infrastructure facilities as well as expanding Coca-Cola product portfolio in Vietnam, including pure bottled water segment under the Dasani brand,” said Coca-Cola’s external relations director Nguyen Khoa My.

La Vie Company Limited, under Nestle Waters Group, recently announced a fresh $12 million investment plan into a new production line in southern Long An province, raising its total investment capital in Vietnam to $23 million with two established production facilities.

“This is La Vie’s biggest ever investment to date. The new line’s capacity would be tripled the existing one’s with an enclosed and entirely automatic process,” said La Vie Vietnam Ltd’s deputy general director Nguyen Thi Tuyet Van.

“This would become Vietnam’s largest bottled mineral water production facility until now,” she said.

Beverage giant Pepsi, which owns the popular Aquafina brand, took over a former San Miguel plant in southern Dong Nai province’s Long Binh Industrial Park, which started operating in the first quarter of 2012 with an annual capacity of 180,000 litres.

“This is part of our strategy to grow presence in Vietnam, or more exactly to materialise our $250 million investment capital commitment in 2010,” said Saad Abdul Latif, managing director of PepsiCo Group in Asia, the Middle East and Africa .

According to recent statement by Binh Duong Provincial Planning and Investment Department, Japan’s Kirin Vietnam Beverage located in My Phuoc Industrial Park in the province’s Ben Cat district decided to bolster its chartered capital to $15.8 million to inject into producing bottled and canned fruit juice and other drinks.

This is one of 17 foreign -invested projects being licenced and registered to raise investment capital in the province in the first eight months of 2012, according to the department.

When foreign players ramp up efforts for market share expansion, local players have also proven more proactive in investment decision.

This was seen in Vital brand’s recent efforts for roll-out of strings of fresh drinks like bottled fresh lemon, salt lemon and passion fruit.

Vinamilk, Vietnam’s leading dairy brand, also steps in the market through launching bottled salt lemon to satisfy consumer appetite for nutritious drinks.

“How to make themselves outshine the crowd with breakthrough brand promotion and market expansion plans remains the greatest challenge to local players,” said Huong Quynh.

Bao Giang (