Quotes of the Day

Sunday, Mar. 07, 2004

Open quoteThings did not go better with coke last week, at least not in Britain. When the Coca-Cola Company launched its Dasani brand bottled water in the U.K., it found itself awash with bad publicity. Coca-Cola's $12.8 million British ad campaign ("The more you live life, the more you need Dasani") was barely under way when newspapers began shouting that Dasani's "pure still water" is a filtered version of the same H2O that pours out of millions of London taps. Since Dasani is produced in Sidcup, Kent, one tabloid dubbed it "Eau de Sidcup." Others quickly calculated that Dasani is making a 3,000% markup on water that the utility company claims is 99.92% clean (though their arithmetic did not include the cost of filtering, bottling or marketing), and food-standards officials announced they are investigating the company's use of the word "pure."

That Dasani is filtered tap water was hardly a trade secret — and it didn't prevent the product (or its filtered-tap rival, PepsiCo's Aquafina) from becoming huge hits in the U.S. But Europe is the spiritual home of bottled mineral water, and Dasani's British launch marks the first time a well-known American water brand has made a serious play in Western Europe. What's more, Britain is the beachhead of Coca-Cola's campaign to establish Dasani in 20 new territories and make it the world's No. 1 water brand. An invasion of France is scheduled for next month with an ad campaign saying: "Let's treat ourselves well every day" — something for which the French are already pretty famous.

Will European purists reject Dasani's "pure, still water"? Coke thinks not, and a look at the market tells why: the world's bottled-water industry was worth a whopping $42.4 billion last year, and will grow another $10 billion by 2007, according to industry consultants Zenith International. Even water-shy Britons are catching up, drinking 2.2 billion dollars' worth last year, a 16% rise. And despite British media howls, 44% of the world market is already processed tap waters like Dasani, which was launched in 1999 and has become America's No. 2 brand ($765 million in sales), behind only Aquafina ($838 million).

Coca-Cola insists Dasani's production process would pass any standard of purity. It uses a "reverse osmosis" filtering technique to strip the water to molecular H2O before adding a cocktail of minerals to impart the flavor. The company's other purified waters, such as Bonaqua, a big seller in Central and Eastern Europe, Germany and Spain, are prepared the same way. But Coca-Cola's plan for Dasani rests not on tickling a universal tastebud, but with regional variations of both branding and flavor. "We're designing a product to match consumer preference," says Jonathan Chandler, communications director for Coca-Cola in Europe. Which is why, when Dasani launches on April 19 in France, the world's biggest per capita guzzlers of bottled water (140 L per year) may be comforted to know that their Dasani is spring water, drawn warm from its 60-year journey through the earth's bowels, at the Astrid source in Chaudfontaine, southeastern Belgium, before being treated. "The U.K. palate demands a very clear, clean taste to the point of having none at all," says Vinay Kapoor, Coca-Cola's director for new products in Europe, who conducted market tests in both countries. "What clearly emerged is a mineral deficiency in the diet of most French consumers."

Customized manufacture and branding could give Dasani the edge it needs, says Zenith director Duncan Finlayson. "The U.S. has always valued processing as a guarantee of purity; in Europe it's the naturalness of water. The U.K. is somewhere in the middle." And in France? "They can tell the difference between mineral or source water and they're willing to pay for the health benefits," says Gilles Babikian of drinks distributor France Boissons.

The water fight in Europe is likely to turn on corporate muscle. French-food group Danone's deal to supply Evian to McDonald's outlets in France and Britain could soon go the way of its Dannon brand, which McDonald's dropped from its U.S. menu last week. With Coca-Cola's chiller cabinets and existing deals across the Continent, Dasani's competitors could end up facing pure water torture.Close quote

  • MICHAEL BRUNTON | London
  • Coca-Cola's new "pure" bottled tap water suffers a flood of criticism in Britain
| Source: Coca-Cola's new "pure" bottled tap water suffers a flood of criticism in BritainCoca-Cola's filtered tap water Dasani is a U.S. hit but got drenched in British criticism. Is Europe ready for American water?