Sunday, July 15, 2007

Thirsty? Bottled water industry booms....

In what would seemingly be a perfectly competitive market, some producers of bottled water have found ways to make their products more unique, individual, and attractive to the market--causing high prices along with high sales for bottled water. At the cafe featured in this news clip, the best selling bottle of water is 30.00 a bottle, and the most expensive bottle of water is 55.00! So what is the big deal about this bottled water? I can turn on my tap and easily get drinkable water. According to the taste test, apparently, 3 out of 4 preffered the "expensive" water over the tap water, though. As far as health is concerned, the benefits of bottled water vs. tap water are still under debate, so why do you think so many people are willing to spend so much money on a simple bottle of water?

3 comments:

John Stack said...

The bottle of water does seem to be a staple of American culture. It's portable, usually small, and it is healthy. The taste test may very. One cannot take the tap everywhere, and one cannot always be certain whether the public fountain is sanitary. This branding is something else. I agree, water is water. $55.00 is a little excessive. It better pour itself. If people are willing to pay at any price, I would sell water for some outragous price also. Those people probably also prefer the "taste" of artesian water. Artesian actually refers to the way the water comes out of the ground, not the taste. It flows from the ground under its own pressure.

Jordan Slavin said...

I agree that in many cases people feel more sanitary drinking bottled water rather then from a fountain or even a faucet. I also agree that bottled water at $55.00 is a little extreme. The bottled water company's are making a good profit on selling bottled water because it is quick and easy. Right after your done you just throw the bottle away. I believe they are able to raise the price because Americans today want everything easy and fast. I also believe that the looks of the bottle and the fancy foreign name help sell more. For example, if you were going to choose a between Fiji water, with the fancy bottle and logo, and a generic bottle,with a simple logo, that tastes identical, you are going to buy the Fiji water. It has a lot to do with name brands. How can someone buy even a $30 bottle of water and even complain about gas price?

Greg Delemeester said...

[This comment is by Chunzi.]

In fact, the quality of the bottled water is really not that big difference from the tap water. May be the water companies would add something such as Vitamin E, some flavor, the original quality of the water is the same as tap water. You can buy a can of Gateorade and make a bottle which is so called “ energy drink”, this kind of self-make drink are full of shelf in WalMart by a price which is around 7 dollars.
The companies which sale the bottle water by a 55 dollars price are trying to attract consumers by their package design or some so-called “special elements” within the water which in fact are just normal Vitamins and sugar. It’s a war of psychology.
They make the package look good and labeled some fancy elements on the package and say this is a totally different water which in fact is only worth of 3 dollars a bottle. But this kind of business strategy really works on some consumers who believe in the so-called “a healthy way of drinking water”.
And this is also the strategy of companies that differ from many other water companies. As there is no winner of earning much more price in the perfect competitive market, before 55 dollars water showed up, nothing was different among energy waters. Everybody is price taker. In order to differ and specialize the products, some companies figured out this way to sale the incredible expensive water.