Another major factor that contributes to the successful development of the Evian Brand is their alliances with other major firms. Advertising of Evian targets the 15-34-year-old age group and particularly women.
“The growth in advertising has always been closely linked with the growth in visible branding.”
(Ellwood, I. (2002) The essential brand book. 2nd ed. Pg 13)
In January 2004, for a third year running, MSN had increased Evian’s brand awareness with a ‘refreshing’ campaign. Evian had positioned themselves as the “New Year detox solution” - a way to clean the body and mind after the excesses of Christmas and the New Year. Evian wanted to increase their consumer awareness of the drink’s healthy attributes and encourage people to associate Evian with detoxing after the New Year celebrations.
“Evian decided to team with a partner that could offer the largest possible engaged
audience and chose online as part of their overall integrated marketing campaign.”
(Nick Brock, Evian Senior Brand Manager)
Evian Advertising
The image below shows some screen shots of the MSN home page and how Evian was advertised through their detox campaign. This campaign was considered a great success, with the homepage seeing over 3.2 million users – 8% above the campaign target of three million. The editorial feature saw over 121,000 users – 22% above the campaign target of 100,000. (Keynote Report on bottled water 2005)
Chris Ward, MSN Commercial Director stated, “The Evian brand already benefits from high brand awareness, and therefore wanted MSN to help them focus on messaging and association. Online was the ideal channel to do this, whilst targeting a key audience – workers back in the office after the New Year celebrations.”
Summary of Bottled Water Industry
Bottled water consumption has grown exponentially over the past ten to fifteen years. This growth has taken place globally, but particularly in Europe and North America. The bottled water industry is within a phase of rapid increase and vastly becoming a major market share holder in the soft drinks market, furthermore the industry has been stated in the mintel report as ‘one of the fastest-growing sectors of the soft drinks market and was the greatest contributor to growth in sales of soft drinks between 2001 and 2005.’ (Mintel report 2005, market analysis).
Summary of Market Share/ Competition
Evian specialise in the production of bottled water and they are placed in an industry that is split into three main produce, which are mineral water, spring water and flavoured water. There are three main bottled water producers in this industry, which are Danone, Highland Spring and Nestle. The graphs below show the trends of the mineral water market, explaining how the market share has changed. Evian’s performance comes under Danone as they are owned by this firm.
Market Share 2003 figures %
Market Shares 2004 figures %
Market Shares 2005 figures %
Danones major competitors in this industry are Nestle and Highland Spring. From the years 2003-2005, Nestle have been experiencing a period of decline from 6.8% to 6.6% and own label’s percentage has declined from 47.7 to 46.7. The decrease in market share of Other Brands and Own Label Brands isn’t necessarily because their sales have dropped, the reason their market share has dropped is because they have been out performed by certain brands such as Danone and Highland Spring. Danone have been able to maintain a strong foothold in the market and have been on a steady increase from 27.4% to 29.1%. These firms have had a higher increase in sales then their competitors therefore they gain more market share. So the question we need to ask ourselves is why Danone is so successful in increasing their market share and become the industry leader? According to mintel reports, ‘Danone’s brands, Volvic and Evian command the greatest investment in terms of advertising, accounting for around 62% of the industry spend in 2004’
All of Evian’s competitors are shown in the graphs above. Nestle and Highland Spring being the main. There are also many own brand labels and other label companies that pose a slight threat to Evian but people still prefer Evian over their competitors purely for the unique taste and the customer loyalty between customer and company.
Evian’s position on the product life cycle
In order to examine the current situation of Evian, I felt that it would be appropriate to create a product life cycle that shows where their products stand at this current time. It was stated by Kotler (2002), that the product life cycle refers to the course of a product’s sales and profits over its lifetime. It involves four distinct stages, which are: introduction, growth, maturity and decline.
Examining Evian’s current position in the market and looking the bottled water industry, I believe that Evian is currently at its Growth Stage in the product life cycle. Evian’s product life cycle hasn’t matured nor declined as their sales are still booming. I feel that Evian’s core business, which is the bottled water industry, is still growing as people are now realising the importance of drinking water. This is linked to the strong brand equity that Evian possess. Health is a key driver behind the rising sales of bottled water. More consumers are increasing their daily intake of water.
Evian are currently at the growth stage
Introduction Growth Maturity Decline
Sales
Time
“Many people don't drink enough water which leads to dehydration. Dehydration can cause muscle pain and even headaches.”
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Bottled water is steadily gaining in popularity. Many people purchase-bottled water because they prefer the taste. Others believe that, because of environmental pollution, bottled water is a safer choice for drinking than their own household supply.
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The BCG Matrix
The BCG Matrix is a method of evaluating businesses relative to the growth rate of their market and the firm’s share of the market. This framework assumes that an increase in relative market share will result in an increase in the generation of cash. The position of a business on the matrix above will provide an indication of their cash generation and its cash consumptions.
High Low
High
Low
Evian’s bottled water products are currently placed in the cash cow box as they fit the requirements. These products are market leaders and produce large mounts of cash. The cash that Evian gain here can be used to change the Evian Affinity product range into Stars and hopefully Cash Cows.
Evian’s Product Line
Kotler (2001) defined a product line as ‘A group of products that are closely related because the function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlet, or fall within given price ranges’
There are two key attributes that explain a product line, whether the product line are Stretching or Line Filling. Stretching takes place when a firm decides to extend its product line beyond its range and Line Filling takes place when more items are added within the existing price range.
Evian have undergone product stretching on their product line as they have introduced new products into a new product line. This refers to Evian’s Affinity Range that was launched in 2001. I would call this an upward stretch as they have marketed their new products at higher price than their usual products. Evian were hoping that they customers will associate the quality of their original brand name with their new product. Customers will therefore be more likely to trust the new product.
Evian’s Brand Strategy
Looking at Evian’s current brand strategy, it is clear to identify that Evian has adapted the “Brand Extension” strategy from all the possible strategies. This specific strategy was used by Evian introducing their Evian Affinity Range in 2001. Evian used their successful Evian brand name to launch this new product in a new category.
The advantages that Evian obtained by this strategy relates to market share capture, the advertising spend efficiency, and the credibility they gained by establishing their brand name in new product categories. The only disadvantage Evian really had to be aware of is if the new product and brand name are ill matched. They wouldn’t have wanted the Evian Affinity range to ruin their current strong brand image. If Evian were to build their brand awareness, I believe they should continue to create other brand extensions and look to extending their brand line by creating similar or new products to their customers.
Perceptual Mapping
Perceptual mapping is a graphics method which is used by marketers which attempts to visually display the perceptions of customers or potential customers. Perceptual mapping helps to provide an insight into appropriate competitive actions. The map can show a companies understanding of the marketing tasks that are involved in product offering if the product is perceived to be weak. Below is the perceptual mapping for Evian.
Evian
Volvic
Buxton
Highland Spring
Nestle
Vittel
Brittvic
Eaten
Company Brands
i.e. Asda, Tesco
According to the perceptual map above, Evian are currently moving towards the ideal division to be the perfect brand. It is clear that Highland Spring and Nestle are their closest rivals and the other brands are out of Evian League. Volvic are also owned by Danone so they don’t act as rivals. The information above is purely based on the market position of products in order to determine where the brand is placed in the map.
Evian’s Brand Equity
“Brand equity is a set of assets linked to a brand’s name and symbol that adds to the value provided by a product or service to a firm and/or that firm’s customers.”
(Aaker, D. A. (2002) Building strong brands, Pg 7/8)
“Brand equity is the value built-up in a . It is measured based on how much a customer is aware of the brand.” Ellwood, I. (2002) stated that “The most important value of a brand to a business is the equity it adds to the balance sheet.” The encouraging beliefs that consumers accumulate about a specific brand are what makes the brand a valuable asset for the company that owns it. Alan Mitchell of Marketing Week described brand equity as "the storehouse of future profits which result from past marketing activities.” Brand equity could either be positive or negative. Evian have strong brand equity as they fulfill the criteria for positive brand equity, for example, positive brand equity is created by effective (advertising and MSN campaign) and consistently meeting or exceeding customer thoughts and this is something they have accomplished through their brand development. Negative brand equity is the result of bad management and this is something that Evian do not possess.
“Advertising has been a particular powerful way of communicating a brand’s functional values, as well as building and communicating its emotional values.”
(De Chernatony, L. (2006) From Brand vision to brand evaluation. 2nd ed. Pg 5)
The basis of brand equity lies in the relationship which is developed between a consumer and the company selling the products or services under the brand name Evian have developed their high brand equity through their excellent customer loyalty. Evian are currently the best selling mineral water brand in the world and sell more bottles of water than any other competitor so Evian must have something unique that adds values to their brand which ultimately attracts consumers over competitors. Their customers prefer their products over their rival products and they believe Evian products have extra value. Evian customers are willing to pay that little bit extra for products because of many reasons. In return for the customer’s brand loyalty, Evian essentially assures the consumer that the product will confer the benefits associated with, and expected from, the brand.
“Customer loyalty is the key to the long term success of a brand and business. The promise that the brand offers must be supported by the product offer in use, otherwise the brand will quickly be recognized as a superficial gimmick.”
(Ellwood, I. (2002) The essential brand book. 2nd ed. Pg 16/17)
Evian have already been established to have strong brand equity, the question now is how will they protect their valuable asset? They need to find appropriate measures of their brand equity. If the Evian brand was to lose its unique image in the minds of customers, their branded products will become more like a commodity. The customer loyalty would be reduced and this would have an equivalent negative effect on the company market share and profit margins.
Key challenges facing Evian’s continued success
One of the future challenges that Evian need to tackle in the future is the supplies of fresh water, which are increasingly rare and fragile. This has become one of the great challenges in present time, in terms of quantity, quality, access, distribution of the planet's resources. However, water is a renewable resource which goes through a natural cycle of evaporation, precipitation, runoff and catchments.
Another of Evian’s challenges is to continue to meet consumer needs. This is linked to competition. The prices set by own labelled brand companies such as Tesco and Asda could attract a lot of consumers. However these specific products are generally cheaper quality and do not represent brand image. They are attractive to customers on a lower budget as they are relatively cheaper compared to their branded rivals. Tesco purposely place their own cheaper No Frills bottled water next to producers such as Evian because they want the consumers to identify the price savings they could make. The innovation of new methods of producing the variations of bottle water has led to a general decrease in prices.
Ralph Turvey (1971) quoted “Manufactures spend a great deal of money trying to find out about consumer preferences so that they can tailor their products more closely to what people want.”
I believe that “Income” plays a huge part in determining the demand for a product. Evian products are seen as luxury products to consumers and could be purchased for this reason or as part of the public’s ambitions to live a healthier lifestyle. As the general household income rises, it could yield a greater demand for Evian products. If the economic performance is poor, it may deter customers from purchasing Evian products.
The Brand image is very significant in the bottled water industry. This follows as people who drink from bottled water assume that, the more expensive the water and the better image the company provides, therefore the more interest consumers will have in their product. This comes from the assumption that Evian products are more purified then bottled water products produced by ASDAs own brand. These companies have spent years building up their brand image, proving the success of their product. It is a challenge for Evian to keep their brand image to a high standard.
I think the main challenge for the Evian Brand would be to beat off rivals. Rivals in the same market can innovate and try match the standards set by Evian but this hasn’t been possible at the moment but who knows what the future holds. Although Evian hold most of the market share in their industry they operate in, they still want to over power their competitors. Rival firms can innovate products and offer products similar to Evian but for a cheaper price. This is when Evian’s brand equity plays a part and whether their customers are really that loyal to the Evian brand.
The market in which Evian are placed in is booming and does attract new entrants so it would be a challenge for Evian to eliminate new entrants. An example of this would be when Coco Cola had entered the bottled water industry with the name of “Dasani.” Dasani was unsuccessful in the market and quickly reached the decline stage of the product life cycle. “Coca-Cola's Dasani brand of bottled water was found to have illegally high levels of bromate, which is a cancer-causing chemical. Coca-Cola, which had called their water, "as pure as bottled water gets," immediately recalled 500,000 bottles. It is, of course, a public relations disaster for the company, which has been trying to develop new markets other than soft drinks.”
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So Coca Cola had realised the opportunity in the bottled water industry and came up with their own water brand but Coca Cola had simply used tap water. Coca Cola realised they couldn’t fight the trend towards water forever.
How the Evian Brand be strengthened through to 2010
Evian’s core business is the manufacturing of bottled water. Many sources have stated that the bottled water industry will continue to grow primarily by the trend towards healthier eating habits. More consumers are becoming aware of the need for adequate hydration and are realising that diets can be improved by drinking more water.
Porter’s (1986) generic strategy model concentrates on the strategic choice of differentiation, cost leadership or focus as the core approach for a brand.
(Ellwood, I. (2002) The essential brand book. 2nd ed. Pg 234)
Evian have already adapted the “Differentiation Strategy.” This has been linked to their successful innovative ideas.
Innovation
Innovation has helped Evian in their current market as it is common. Organisations are always trying to innovate and differentiate their product range in order to gain more market share and build their brand awareness.
“Successful brand building helps profitability by adding values that entice customers to buy.”
(De Chernatony, L. and McDonald, M., (2003), Creating powerful brands in consumer, service & industrial markets, 3rd ed. Pg 14)
For example, Volvic, who are also owned by Danone, they introduced flavored water and now other firms are also trying this technique. Evian have introduced skincare products that contain only Evian water. Evian were also the first company to offer a spa to their customers (Evian Affinity). By introducing these beauty products, Evian have attracted a new set of customers as they have differentiated their product range and being apart of other industries gives Evian a more competitive advantage and higher strength. Danones research team has shown in-depth research into the designing and packaging of their bottle water products for Evian. They developed the easy grip on Evian’s portable water bottles which came in the 330ml, 0.5 L and 1Litre sizes. The easy grip is grooves and frosting on the outside packing of the bottle which allows consumers easier grip while holding the bottle. After a year of research Evian realised that most consumers purchasing these bottles would carry them around throughout, so they invented this easy grip bottle. I believe Evian can still look at ways to innovate their products in order to gain competitive advantage over their rivals as this would be a major strategy to build their brand strength.
“Evian’s innovative on the go bottle is introduced so that consumers can take Evian where they go”
Ansoff’s Product/Market Matrix Model
Ansoffs product/market matrix model is used in strategic marketing planning.
In terms of market penetration, Evian have already implemented this strategy as they have already marketed their existing products to their existing customers. Product Development, Diversification has also been taken place when Evian had introduced Evian Affinity to their consumers and innovated their products. Market Development has also taken place as their Evian brand is known worldwide. I think Evian should continue this successful strategy of diversifying their product range and improving their product range because that is what is keeping them at the top of their industry. Their brand awareness is vital in order for the brand to stay strong. Aaker, D. A. (2002) quoted that “Brand awareness refers to the strength of a brand’s presence in the consumer’s mind.” It has already been mentioned before that the industry that Evian are competing is set to grow further in the coming years, so Evian should take advantage of these facts and look to further develop their brand and build their brand awareness.
If Evian were to merge with another company, this could also be a successful strategy for the coming future. The reason for this choice can be linked to Evian continuing to differentiate and diversify their product range. For example, when Evian introduced their Affinity product range, they joined up with Johnson & Johnson who would make their new products through product extensions. Maybe in the near future, Evian decide to enter a new market so those merging with another would benefit them in the future.
Conclusion
The following analytical account demonstrated how the Evian has become so successful over the years. Evian current market position was analysed and all the factors that contributed to the success of the Evian Brand were also stated. I found out that Evian have a strong equity as this topic was closely examined in the report. I believe the reason for the Evian Brand being so successful can be due to the fact that Evian meet consumer needs and they look after their customers. I have realised that the Evian Brand has a bright future I believe their brand will continue to grow in the future. I recommended that Evian should continue to be innovative and carry on product developing in order to remain a dominant force in the market they are present in.
References:
Aaker, D. A. (2002) Building strong brands. New York: Free Press.
De Chernatony, L. (2006) From Brand vision to brand evaluation. 2nd ed., Oxford:
Butterworth-Heinemann.
De Chernatony, L. and McDonald, M., (2003), Creating powerful brands in consumer, service & industrial markets, 3rd ed., Oxford: Butterworth Heinemann.
Ellwood, I. (2002) The essential brand book. 2nd ed., London: Kogan Page.
Bibliography:
Textbooks –
Aaker, D. A. (2002) Building strong brands. New York: Free Press.
De Chernatony, L. (2006) From Brand vision to brand evaluation. 2nd ed., Oxford:
Butterworth-Heinemann.
De Chernatony, L. and McDonald, M., (2003), Creating powerful brands in consumer, service & industrial markets, 3rd ed., Oxford: Butterworth Heinemann.
Ellwood, I. (2002) The essential brand book. 2nd ed., London: Kogan Page.
Evans, A. et al. (2004) Business planning and decision-making. Harlow: Pearson Custom Publishing.
Needle, D. (2004) Business in context. 4th ed., London: Thomson.
Electronic Resources –
Search Engines –
Bottled Water Advertising: Evian
(25th October 2006)
Bottled Water - UK - June 2005
(27h October 2006)
Definition Evian
(25th October 2006)
Do Global Brands Benefit From a Unique Worldwide Image?
(27h October 2006)
Evian
(25th October 2006)
Evian
(28h October 2006)
Evian
(27h October 2006)
Evian Brand
(25th October 2006)
Evian moves into TV sponsorship and joins the world of fashion
(27h October 2006)
Evian Natural Spring Water
(27h October 2006)
Evian Spa
(27h October 2006)
Evian Spa, bathing in luxury
(27h October 2006)
Groupe Danone
(25th October 2006)
Groupe Danone
(29h October 2006)
Sell the Brand, Not the Product
(25th October 2006)
Take a Brand Stand
(25th October 2006)
The History of Bottled Water in the UK
(27h October 2006)
University of Wolverhampton
(27h October 2006)
- Ebsco
- Science Direct
- Keynote - Mintel
Market Research Databases –
- Mintel Report on the UK Bottled Water Industry
- Keynote Report on the UK Bottles Water Industry
Journals –
Journal of Brand Management
Journal of Product and Brand Management
Appendix
Powerpoint Presentation on Evian