Fiji Water - case study PDF

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Fiji W Wa ater ter:: T The he e ex xotic w wa ater br bra and Fiji Water is one of the newer examples which testify that competent branding can elevate even the simplest commodity to celebrity status. In a category dominated by France’s Evian, Coca Cola’s Dasani and Pepsi Co’s Aquafina, Fiji Water has come to occupy third place within a short span of eight years and has grown its sales by more than 61 percent in 2004 as against a 23 percent loss of its French rival Evian. By following non-traditional methods of marketing, a distinct positioning, and a high-end pricing of US$5.90 as against Dasani’s US$2.99 and Aquafina’s US$2.49, Fiji Water has been able to establish strong brand equity among the top-tier market segments including celebrities, Hollywood stars and the best restaurants of New York and California.

Fiji’s background Fiji Water, the company that owns the Fiji Water brand, was founded in 1988 in Basalt, Colorado by David Gilmour, a businessman with interests in hotels, real estate and gold mining. The Fiji Water brand came into life in the early 1990s when Gilmour secured a 99-year deal with the Fijian government to tap the aquifer discovered by government contracted geologists and market the water under the Fiji Water brand name. Fiji Water has made extensive use of product placements in leading Hollywood movies, high-profile events and exclusive restaurants to include the brand in the elite community.

Branding philosophy As many in the bottled water category have commented, all water tastes the same. This means branding in this category is not product-focused, but story focused. The company which tells a better story and backs it up with credible facts, thereby creating an exciting myth, wins the day. Fiji Water seems to have understood this underlying truth extremely well. The Fiji Water brand is built on three pillars: creating an exciting myth, precision marketing (including personal relationships and product placements) and a controlled distribution strategy. As the physical attributes of the product cannot be differentiated in themselves, Fiji Water has resorted to creating a powerful story around the product. Fiji is a 332-island nation in the South Pacific, far from the US market and customers. This physical inaccessibility has enabled Fiji Water to create the story of this water being extracted from a virgin ecosystem far from acid rain, herbicides, pesticides and other pollutants, having for years been filtered naturally through layers of silica, basalt and sandstone, as communicated through its packaging. This story provided customers with something unique to sit up and take notice of. The story was backed by the credible fact that Fiji is an unexploited land full of tropical forest surrounded by coral reefs, unpolluted by the modern world’s necessary evils and protected by nature as it were. This created a strong myth about the brand among

customers, which in turn built the brand. The myth creation was backed by precision brand marketing. Fiji Water did not resort to the usual mass media advertising for its product launch. It formulated a two-pronged strategy: 1 Building personal relationships with the chefs of leading restaurants, resorts and spas to promote the buy-in of the brand 2 Placing the product in leading Hollywood movies and other high-profile events to attract attention and create buzz. Gilmour used his contacts in the hotel industry to pitch his product to the top end hotels, resorts and restaurants. By coming out with an award-winning slippery silver bottle design, Fiji water has been able to replace Evian in many of the top-end restaurants. Fiji Water has resorted to product placement as a major channel of promotion and brand building. By hiring Creative Entertainment Services, a Hollywood marketing consulting firm, Fiji has been able to fit Fiji Water bottles into the scripts of many major Hollywood movies. These exposures to the brand, when combined with the exciting mythical story, have made the brand noticeable. Fiji Water has also sponsored many local events such as golf tournaments, sailing regattas, and musical events. Another important aspect of Fiji Water’s branding philosophy has been its controlled distribution strategy. In line with its positioning as a high-end product, Fiji Water has ensured that it is available at the best hotels, resorts and spas used by the leading stars, and managed to get chefs’ recommendations. As is generally known, the bottled water category is notorious for its difficulty in making money. “What we offer distributors as well as retailers is the opportunity to make profits in a category that they have become used to not making any money in. Bottled water can be very difficult to make money in if you’re selling a commodity product” says Edward Slade, President and COO of Fiji Water. With its unique positioning and pricing strategies, Fiji Water has been able to make money and help its distributors to make money. Although Fiji Water’s bottles were off the shelves due to its initial inability to keep up with the huge demand, this has added to its feel of exclusivity. This controlled distribution has helped Fiji Water to be at the right places at the right time, thereby helping in brand building.

Future challenges In the bottled water category, Evian pioneered the idea of elevating a commodity to a brand status. Looking back, Evian did the things that Fiji Water is doing now. Fiji Water has until now been quite successful with its marketing, storytelling and distribution strategies. The biggest challenge for Fiji Water in the future will be to sustain this level of interest in its brand. The problem of basing the brand heavily on such a myth is that it does not create any barriers for any new entrants to come up with another, equally exciting, myth. Given the low level of involvement of customers in selecting water, customers would be willing to try out newer and more exciting brands as and when they come up. In this regard, Fiji Water should focus on formulating a strong customer loyalty and retention drive in the light of impending

competition. Although Fiji Water has managed to be included in a Forbes list of things “worth every penny”, it will require more than a strong story to carry it through in the future....