Behind the challenges in the premium water market lie opportunities. Looking back at the magical 2020, the impact of COVID-19 and the "full shutdown" of society and economy brought by prevention and control measures caused the global economy to contract severely in 2020. Especially after a long period of lockdown, work stoppages, and production halts, consumers' wallets are getting thinner, and reducing spending is a common goal for everyone. The pandemic also brought unprecedented challenges to China's FMCG market. According to a report by Kantar Worldpanel and Bain & Company, in Q1 2020 alone, overall FMCG spending fell by 6.7%, with food and beverages down 7.7%. Although FMCG spending gradually recovered in Q2 and Q3, it still could not offset the negative impact of the pandemic in early 2020. Under the pandemic, there were not many winners. Many brands in the FMCG category, such as Danone, Nestlé, and Tibet Water Resources, saw varying degrees of decline in their water businesses: compared with 2019, Danone's water and beverage sales fell by 16.8% year-on-year, Nestlé's bottled water business saw an organic growth rate of -7%, and Tibet Water Resources' water business segment revenue decreased by 55.9%. In contrast, with the shift in concepts and behaviors of the new generation of young Chinese consumers, healthy beverages or functional drinks labeled as "healthy," "sports," "weight loss and fitness," such as sugar-free tea drinks and pure juices, have set off waves of "whirlwinds," growing against the trend, and are likely to replace bottled water consumption and squeeze the premium water market. ****-01-****Industry Dilemma, Brands Fight a Breakout Battle Selling water is not an easy business. Should the pandemic take all the blame? Not entirely. In 2020, a major event also occurred in China's water industry under the pandemic: Nongfu Spring successfully listed, and its founder Zhong Shanshan briefly became China's new richest person, drawing attention to the broad prospects of China's bottled water market. It is worth mentioning that in the post-pandemic era, people's desire for health and quality is stronger than ever. How brands can seize the growing demand for higher-quality drinking water, track changes in consumer behavior, and formulate growth strategies under the "new normal" has become a "compulsory course." Facing the pandemic dilemma and changes in consumer demand, premium water brands such as VOSS, Danone, and Nestlé have made bold moves to break the deadlock. VOSS, as a fashionable premium water brand from Norway, has always been the drinking water in guest rooms of high-end hotels. As the designated water for many ceremonies, hotels, and events, VOSS has maintained solid channel relationships with international five-star hotels and has established a very solid image in the domestic premium water market. It is worth mentioning that to provide higher-quality premium water services after the pandemic, since August 2020, VOSS has partnered with star-rated hotels such as Waldorf Astoria, Hilton, and Conrad to launch the "Taste VOSS" series, using VOSS water as cooking water for ingredients, a base for cocktails, and a companion for afternoon tea, advocating a pure and ultimate deliciousness to bring people a genuine quality life. In addition to consolidating existing premium channels, VOSS further combines channel and brand development to broaden consumption scenarios and penetrate the public's mind. Cross-industry co-branding easily brings freshness to consumers and is a common marketing method for many brands to capture user attention. The king of cuisine, Laoganma, collaborated with Opening Ceremony to launch Logo hoodies; Want Want partnered with Chando to launch snow lily hydrating masks and Want Want snow cake cushions; and domestic trend brand Li-Ning x People's Daily launched co-branded trendy products, truly creating "newspaper-style" items. VOSS also saw the traffic advantages brought by cross-industry co-branding and launched co-branded products with many well-known brands. VOSS collaborated with Lane Crawford to create a Super Natural themed limited-edition gift box, injecting inspiration water into fashion; joined forces with popular tea drink brand Nayuki to launch two co-branded limited-edition cold-brew teas, "Zhi Bai Ran Xia" and "La Mei Ning Xiang," defining a new trend of cold brew; and partnered with Tongrentang to create four "hybrid" New Year special drinks, including "Da Ji Da Li," "Da Shan Zha Leng Cui," "Luo Han Guo Mei Shi," and "Hong Shen Nuan Han Cha," to meet the personalized tastes of young people and embrace Generation Z with innovation. To cope with the demographic structure and consumption habits of China's younger generation and seize the youth market, VOSS has further expanded its entertainment and digital marketing. From placements in popular web dramas like "The Sword and the Brocade," "Surgical Strike," "I Like You," and "Growing Up Together," to recommendations in live-streaming rooms of "shopping queen" Viya and seeding on social media platforms like Xiaohongshu, VOSS can be seen everywhere. In 2020 under the pandemic, VOSS achieved a double harvest in brand and market: sales exceeded targets and maintained double-digit growth. Focusing on the drinking water industry, unlike VOSS's strategy of "adding" through cross-industry co-branding and digital entertainment marketing, Danone's strategy is to "subtract": In June 2020, Danone sold its Yili drinking water business to Shenzhen Huhu Youwu Trading Co., Ltd., leaving only Mizone and imported drinking water brands such as Evian and Volvic, focusing on the premium water business. Similarly, Nestlé also had the idea of "selling water." In July 2020, Nestlé sold its Canadian bottled water business to private bottled water company Ice River Springs; in August, Nestlé sold its water business in mainland China, including local brands "Dashan" and "Yunnan Spring," to Tsingtao Brewery Group. In the drinking water field, Nestlé and Danone share the same idea: strengthen their own international brands and make premium water a strategic direction in the Chinese market. ****-02-****A New Start, Premium Water Brands Accelerate At the beginning of 2021, Nestlé not only continued to "sell water" but also began to "buy water." In February this year, Nestlé sold its bottled water business in the United States and Canada and acquired the premium functional water brand Essentia Water. Together with Nestlé's existing premium water brands Perrier, S.Pellegrino, and Acqua Panna, it is clear that premiumization and functionalization will be two key directions for Nestlé's water business. Long-term layouts cannot compensate for recent performance in the short term. Affected by out-of-home consumption channels, the market continues to "face pressure." According to Nestlé's Q1 2021 financial report, its water business sales saw internal growth of -8.1% and organic growth of -5.6%. Danone's water and beverage business sales also fell by 11.6% year-on-year in Q1 2021. To break the current market situation, as the beverage consumption peak season begins, Danone's Mizone officially announced Liu Haoran and Ouyang Nana as brand ambassadors in April this year, hoping to bring new vitality to the brand with the new ambassadors. In contrast to other brands in the industry, VOSS's sales in Q1 2021 achieved a counter-trend doubling growth, with a strong overall development trend. Why can VOSS achieve sales growth? First, consumers' demand for higher-quality drinking water is growing, and VOSS drinking natural spring water comes from Norway, a naturally pure land in Northern Europe, meeting the high requirements of high-quality consumers for water quality and their desire for a beautiful and refined life. This makes it particularly special among a group of "French-style" premium water brands. Second, VOSS has always strengthened its premium strategic layout by deepening cooperation in global luxury hotel guest room water services, afternoon tea, and catering, sponsoring high-end events such as equestrian, golf, and tennis, and adding to fashion and entertainment events like Shenzhen Fashion Week, Golden Rooster and Hundred Flowers Film Festival, and SKI Ski Music Festival, reinforcing its positioning as a fashionable premium water brand in consumers' minds. It is worth mentioning that from the "Ancient Cuisine Modern Cooking" project co-created with Shimao Hotel to the "Half Tree Pear Blossom" concert, a performance at the 37th Shanghai Spring International Music Festival, VOSS has always taken action to promote traditional Chinese culture, achieving the perfect integration and good development of a Nordic brand in the East. During the just-passed May Day holiday, VOSS collaborated with Yellow Crane Tower to launch customized poetry bottles, paying tribute to Wuhan's restart with the ancient charm of Chinese culture. It is reported that taking advantage of the May Day holiday, the topic #Check-in VOSS Yellow Crane Tower Poetry Bottle# once topped the local Weibo hot search list, and the poetry bottle vending machines in the scenic area were very popular, becoming a new check-in symbol for Yellow Crane Tower travel. ****-03-****New Product Carnival, Where Are Premium Water Brands Headed? In general, the thriving growth of premium water brands in China is inseparable from the gradually mature market soil. Based on the upgrading of people's economic foundation and consumption demand, bottled water consumption scenarios have begun to spread to cooking, tea brewing, and coffee brewing, and gradually have social value such as gifting and hospitality. China's premium water market is ushering in a strong growth period. According to a Frost & Sullivan report, from 2019 to 2024, the compound annual growth rate of packaged drinking water is expected to reach 10.8%, with natural water, natural mineral water, and drinking purified water growing at 15.2%, 14.1%, and 11.7%, respectively. Having survived the difficult 2020, can premium water brands still stir up the waters in the overall improving drinking water world? At the beginning of 2021, Ganten, positioned as the "aristocrat in water," launched a new 4.5L mineral water product, focusing on diversified drinking scenarios such as tea brewing and soup cooking. Nongfu Spring announced the launch of the natural mineral water brand "Changbai Snow," benchmarking against Ganten. VOSS launched the new Hongyun natural mineral water to meet the public's demand for healthy drinking water. It can be seen that premium water brands represented by VOSS are very clear about their brand positioning and know how to influence consumers: The brand always revolves around consumer needs as the core. Where consumer needs are, there is the brand's battlefield; what consumers need, the brand produces. But the premium brand strategies of VOSS and others are not a one-time solution: with the gradual saturation of China's premium water market, the increase of segmented market brands represented by Genki Forest, and the diversification of markets and demand changes from different consumer groups such as "she economy, appearance economy, silver economy, lazy home economy, and single economy," the challenges faced by enterprises are increasingly huge. In the fiercely competitive premium water world, what pattern China's premium water market will form in the future is still unknown, and everything needs time to verify. Source: Caixin.com Once the tip is adopted, a payment of 400-2000 yuan will be made.