Money on tap
April 26, 2008
Sales of bottled water have grown 1000-fold in 20 years. So why are people paying up to $90 for a bottle of what they can get free? Johnny Davis reports
IN THE shadow of Stansted Airport in England, Elsenham is a small village whose amenities run to a convenience shop, a pub and an Indian takeaway.
Leave the railway station, cross the M11, negotiate a landfill site and eventually you come to Elsenham Estate, home to an industrial sealant manufacturer, factories and -- in a shiny building only a couple of years old -- a goldmine.
It's Elsenham Water, one of the world's most expensive waters, ``bottled at source'' from a ``pure confined aquifer''.
Unlikely, you may think. Nevertheless, one 750ml bottle of Elsenham water can cost as much as $68
-- and that's assuming you know where to shop for it. You won't find it in supermarkets.
Elsenham is sold at Collette, Paris's fanciest fashion boutique, served at El Bulli, the multi-Michelin-starred restaurant in Spain (regarded as the world's finest), and swigged by the clientele of Private C, a charter-yacht company that caters for discerning millionaires.
Next time you're staying at the Beverly Hills Hotel in Los Angeles, ask the maitre d' for a bottle.
``When we started in 2005 everybody said `yours is the most expensive water in the world','' says Michael Johnstone, Elsenham's chairman and founder.
``But price is a barrier that's our secret weapon. We don't want to be in the budget hotels.''
The towering glass vessel that holds Elsenham water is made by a company that designs bottles for top French perfumes. Its distinctive cap is trademarked. Every bottle is polished by hand before leaving the building.
``This is really like fine wine or champagne,'' Johnstone says. ``There's a premium category at the top, whereby people having a meal can order a luxury water. We helped create that market. Water is the new wine.''
Johnstone used to be in jam. One day his accountant told him his water bills were too high, so the pair went looking for a leak and instead discovered a borehole.
Johnstone called the Environmental Agency and started digging.
On day five, ``up came water''. He was told he'd hit a confined aquifer under a 400m slab of chalk ``right under this building and half the car park''.
``A confined aquifer is the best water you can get,'' he says.
The deeper you dig, the cleaner and purer water becomes. Pricier, too.
Johnstone got out of jam.
Bottled water is the food phenomenon of our times and an anomaly to previous generations who somehow managed to hydrate themselves from the tap. Global sales increased 1000-fold between 1984 and 2005.
Today the market is worth $57 billion, making bottled water the fastest-growing beverage in the world.
In Australia, a 1-litre bottle of water costs about $1.80 at the supermarket -- more expensive than petrol. Globally we spend more on water than we do on iPods, cinema tickets or trainers.
Australians last year parted with more than $385 million for 252 million litres of bottled water. And Americans get through more bottled water than coffee, milk or beer.
According to the US Beverage Marketing Corporation, 40 per cent of the US market for bottled water is controlled by Nestle, Pepsi and Coca-Cola.
BUT, despite what consumers might assume, not all of the water is extracted from remote mountain wildernesses. Some brands are simply tap water that is purified and sold at vast profit.
The thirst-quenchingly icy mountain range on the Aquafina logo has drawn the ire of US consumer groups, forcing Pepsi last July to agree to state on bottles the water ``. . . originates from a public water source'', a clarification that so far has failed to cause any evaporation in sales.
``The consumer just doesn't seem to care about the source,'' says Gary Hemphill, senior vice-president of the Beverage Marketing Corporation.
Bottled water might be moving inexorably towards becoming the world's favourite drink, but its popularity means pouring Perrier at dinner parties no longer makes the statement it did a few years ago. For that you have to turn to the luxury bottled-water market, of which Elsenham is the tip of the iceberg.
Top-shelf bottled waters represent a completely different category: products from a glacier or volcano that possess characteristics derived from their source -- the more unusual the better.
Take King Island Cloud Juice. This rainwater from Tasmania's King Island is touted as coming from ``the cleanest weather the earth has to offer''.
Entrepreneur Duncan McFie, who hit on the idea of bottling the sky's bounty more than 10 years ago, produces only about 100,000 bottles of Cloud Juice a year, but, like Elsenham, it's in demand at Spain's El Bulli and Paris's Collette.
It sells for up to $21 for a wine-sized 750ml glass bottle in London. In Australia, a 375ml bottle can be ordered online for $3.50.
Farther up the price scale is 10 Thousand BC, ``the most ancient source of water in the world''. Retrieved from melted ice in British Columbia's Coastal Glacial Range, it's bottled to the sound of classical music and costs $34 a bottle in London. Even more expensive is 420 Volcanic, sourced from Tai Tapu, a spring in the foothills of a dormant volcano near Christchurch, New Zealand, costing $48 a bottle.
Then there's Bling H2O, ``the Cristal of bottled waters'', says Kevin G. Boyd, a Hollywood producer who launched the brand in 2006. With its frosted-glass bottle decorated with hand-applied Swarovski crystals and $91 price, Boyd would seem to know his market. Fans are said to include Mariah Carey, Jamie Foxx and Ben Stiller.
``It's for the uber-luxury consumer, the guy who has the $300 bottle of champagne in a nightclub. Order Bling H2O and the perceived value is the same,'' Boyd says.
To make such a statement, you need to hang out in the places where you can be seen drinking the stuff. A handful of five-star Los Angeles hotels now employs water sommeliers to advise on the best water to accompany spiced braised pork belly or fillet of brill with parmentier of truffled leek.
IN New York, the bar Via Genova has been doing a roaring trade, despite serving nothing stronger than 65 varieties of bottled water. The luxury Claridge's hotel in London's Mayfair introduced its first water menu two months ago: a 30-bottle selection from Italy, Japan, New Zealand and Hawaii, among others.
``I already had a problem with our house water,'' says Renaud Gregoire, Claridge's food and beverage director.
``It was too available, too everywhere. But then a customer asked for glacial water, which I thought was completely crazy. I'd never heard of it. I thought, does this exist? So we went on Google. It was quite unbelievable what was out there.''
A few Australian establishments have embraced the water menu concept.
Melbourne's Bottega restaurant has seven labels on its water list (including Voss from Norway, $11, and Hildon from England, $13).
It's all a sign of the times. The micro-obsession with where our food comes from, static fizzy drink sales and the constant reminders to ``drink more water'' have all conspired to swell the market.
Just as fashion's bespoke and limited-edition sectors really took off once designer handbags went from something available to the few to something within the reach of many, the truly moneyed will always try to differentiate themselves in whatever ways they can. Even if it's with the water they drink.
``There's too much money out there, and everything is now available to everyone,'' says Reinier Evers of consumer marketing site trendwatching.com.
``Soon it won't really matter what mundane goods or service you're charging $680 for, as long as you provide a good accompanying story, and thus provide the buyer with a story they can tell others. Every single consumption good can now be turned into ``uber-premium''. Just wait for uber-premium milk, uber-premium matches, uber-premium toothpaste . . .''
Others say we're simply beginning to think about water in a new way.
``Before, it was something you would drink when you were thirsty,'' says Michael Mascha, author of Fine Waters: A Connoisseur's Guide to the World's Most Distinctive Bottled Waters.
Mascha is a wine refugee. Six years ago his doctor gave him a sobering choice: continue drinking wine or live.
``You know, I hesitated for a bit,'' he says. ``Because I had 500 bottles in my wine collection. But I think I made the right decision.''
Now he spends his time producing water menus for hotels and hosting tastings where he enlightens the public on water terroir -- how an origin of spring, glacier or well can dramatically alter taste.
One newspaper panel once had a taster praising a particular water's ``fresh, sweet, lemony aroma'', only to inform them it came from a tap in a Birmingham public toilet.
LAST month Decanter, the wine connoisseurs' magazine, put together a panel of Masters of Wine, sommeliers and some of Britain's most experienced palates for a blind taste test of 24 waters. Scoring top marks was New Zealand's Waiwera, followed by France's Vittel. Plain Thames Water straight out of the tap came third. The ultra-expensive 420 Volcanic rated poorly (in 18th place) as did Bling H2O (a dismal 22nd).
``Even the most well-trained palates,'' said Decanter editor Guy Woodward, ``couldn't tell these supposedly superior products apart from plain tap water . . . In fact, most tasters preferred the tap water.''
Unsurprisingly, a backlash against bottled water is building.
With Australia in the grip of drought and water restrictions in force around the country, some argue bottled is a better choice than tap. But, say both the Australian Conservation Foundation and Clean Up Australia, it's a spurious suggestion.
``Bottled water is the greatest con,'' says Clean Up chairman Ian Kiernan. ``Tap water is delivered to your house for between $1 and $1.20 a tonne.
``Why would you choose to buy water that costs thousands of times more, comes in a petro-chemical container that has only a 35 per cent chance of being recycled, and is transported maybe six or seven times in vehicles that burn fossil fuels?
``You are not doing the environment any favours. What we have to do is get away from bottled water.''
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