Basic H2O

Table of Contents
Introduction ............................................................................................................................................ 2 Executive Summary ................................................................................................................................. 2 Company Description............................................................................................................................... 3 Situation Analysis .................................................................................................................................... 3 Market Demographics ......................................................................................................................... 3 SWOT Analysis ......................................................................................................................................... 4 Competitive Analysis ............................................................................................................................... 6 Customer Analysis - The customer interested in BASIC H20 would be: ................................................. 6 Marketing Strategies ............................................................................................................................... 6 Targets ................................................................................................................................................ 6 Objectives ............................................................................................................................................ 7 Positioning........................................................................................................................................... 7 Key Differences .................................................................................................................................... 7 Pricing ................................................................................................................................................. 7 Distribution Channels........................................................................................................................... 7 Promotion Strategies ........................................................................................................................... 8 Evaluation and Control ............................................................................................................................ 8 Defining Success .................................................................................................................................. 8 Implementation Milestones ................................................................................................................. 8 Contingency Planning .......................................................................................................................... 8 Appendices .............................................................................................................................................. 9 Detailed Financial Projections .............................................................................................................. 9 Bibliography ............................................................................................................................................ 9

Introduction
At Basic H2O we believe your good health starts with the health of our planet. We have bottled our water in biodegradable plastic that is 100% compostable for a cleaner, healthier planet.

Executive Summary
At Basic H2O we believe in taking steps to improve your health. Recent studies published by the Journal of the International Society of Sports Nutrition and the Centre for Bone Diseases conclude that the habitual consumption of alkaline water will help achieve acid-base balance and will increase your hydration status. The consumption of alkaline water lowers bone resorption which leads to a slower rate of bone loss in healthy adults. Our Alkaline water is tested for purity by an independent laboratory to insure the quality and the health benefits you will receive from Basic H2O. At Basic H2O we believe in giving back. A percentage of the profits from the sale of Basic H2O will be donated to CharityWater.org, a non-profit organization dedicated to bringing clean and safe drinking water to people in developing nations. Looking to improve your health? Get back to the Basics. Basic H2O is a product that is safe for consumers and environmentally friendly by creating a more efficient way to produce bottled water.

Company Description
Basic H2O is a company founded with the intention of not only improving the health of our consumers, but also having less of an impact on the planet. Using only the purest sources available, Basic H2O is tested by an independent laboratory to ensure that consumers are getting only the finest water. Basic H2O is an alkaline bottled water, which research has shown increases the level of hydration, and helps prevent bone loss in adults. This is achieved through helping the body maintain an ideal acid-base balance. Our product is packaged in a biodegradable container, which is 100% compostable. Basic H2O uses a patented process to produce a container that will not contaminate landfills or waterways. This process also reduces oil consumption, as our bottles are not petroleum based. In addition to being both healthy and environmentally friendly, Basic H2O has pledged to give a portion of profits to CharityWater.org. This is a not-for-profit organization which specializes in getting water to underdeveloped countries. We believe that everybody is entitled to a drink of water. Basic H2O sees the future holding many opportunities for our company. Our alkaline enriched product can be adapted to include many different flavor options. Having these options gives the company the ability to cross into several markets, allowing for growth and expansion. Our unique combination of offering a bottled water product that is healthy to drink and not harmful to the environment sets our company apart from competitors. This marketing plan outlines how our company plans on educating consumers about the benefits of alkaline water, and showcasing our commitment to improving the world around us.

Situation Analysis
Market Demographics
y Population of United States is growing but the growth rate of the overall US population is slowing due to the aging of the population. Life expectancy is projected in the middle series to increase from 76.0 years in 1993 to 82.6 years in 2050. Growth Rate of US aging population is rising, the overall population will be older than it is now. The median age of the population will steadily increase from 34.0 in 1994 to 35.5 in 2000, peak at 39.1 in 2035, then decrease slightly to 39.0 by 2050.

y y

SWOT Analysis
Location of Factor Type of Factor Favorable Strengths y Proprietary water preparation process y Proprietary bio-friendly bottle material y Production tooling complete y Contracts in place with primary and alternate third-party quality control laboratories y Very small amounts of mineral additive required to alkalize a large quantity of water y Major ingredient for our product (water) also one of the most readily available y Our water will be tested and free from all chemicals and harmful bacteria y Our label will be made to gain the trust of our customers with providing exactly where our water source is that we use y Unique product new to the marketplace with limited direct competition y Easily identifiable, self-explaining brand name y Recognizable as being environmentally friendly using biodegradable plastic y New brand that consumers do not have any negative preconceptions about y Basic H20 has pledged to give portions of profits to charity y Preventing bone loss is filling a different need y Market segment- older adults worried about bone loss and younger adults who value health and fitness y Water is a basic physiological need for all people y Promotes social responsibility with the charitable tie in to building wells in third world countries y Promote environmental responsibility by using a sustainable plastic bottle Unfavorable Weaknesses y Production adjustments costly and timeconsuming y Third-party quality control recertification process is very time-consuming y Exact blend of minerals to make our water alkaline depend upon several specialty suppliers who will be difficult to replace in the event of a shortage y Cost of potable water in sufficient quantity for mass production showing a steadily increasing cost trend y Finding a clean water source to use for our product y Still adding to the millions of other plastic bottles that are discarded each and every day y Expense in educating consumers on benefits of alkaline water could be high y Developing a cost-effective biodegradable water bottle could be time consuming y Brand being new to the market could take time to get public awareness y Convincing skeptical consumers that charitable contributions are actually being made y Social Media marketing to an older generation would be difficult y Product may be considered gender based as bone loss is more of a concern for women than it is for men y In general, tap water in the US is clean and safe to drink and is under more scrutiny than bottled water y The Natural Resource Defense Council estimates that bottled water is between 240 and 10,000 more expensive than tap water

Internal

Opportunities y Responding to changing consumer demands within our area of specialization fairly easy due to existing production methods y Well-known name brands have been slow to recognize changing attitudes toward bio-friendly packaging among consumers y Well-known name brands have completely ignored consumer attitudes toward alkalized water y Solid science exists to backstop our claim that drinking alkalized water is highly beneficial to health y The premium the average consumer will pay for environmentally-friendly packaging is significantly above cost y Over the past several years, bottled water has been recalled for contamination by arsenic, bromated, cleaning compounds, mold and bacteria. We have the ability to take away all these worries for our customers y Increased consumer concern with products that are environmentally friendly y Consumers looking for products that are quick, healthy, and readily accessible (don t require much thought or effort) y Limited competition in the alkaline water market place y Alkaline water is relatively new to the marketplace creating the newness factor y Consumers fear bone loss as they begin to age and it is a growing health concern y Use of social media such as Twitter and Facebook to create a buzz about the product. y Aging population has more buying power and more disposable income y Consumers are more fearful of what is in their tap water y Increased concern about the security of our water supply - terrorism y Possible legislation to levy a tax on sugary soft drinks y Preventing bone loss is important to one s health y Real Alkalized Water sells 1/2 Liter Alkaline Bottled Water for $1.99. Could sell for less and market BASIC H2O as a

Threats y Well-known name brands could have a significant negative impact on customer loyalty should they choose to enter our marketplace y Health benefits of drinking alkalized water difficult to communicate to uneducated / less-educated consumer demographics y Drinking alkalized water may become labeled a health fad by media outlets, damaging our chief distinguishing feature y Consumers may not understand the value-add of our water preparation process y Consumers may view even our biofriendly bottles as wasteful y Other bottled water companies maybe trying to find the same product that we are creating y Most of the bottled water companies are well known by their names and the amount of time that they have been around. This could deter a consumer away from trying out a new brand of bottled water such as ours y A lot of consumers don't know all there is to know about the bottled water they drink. A lot of consumers think that since its bottled, it s safe to consume y Much competition from other bottled water brands and sports drinks y Limited consumer knowledge of benefits of alkaline water y New concept/product to the marketplace could take time to catch on y Only one choice of product could prove difficult with consumers looking for variety y Growing public concern for the environment and sustainability y Ad campaign directed against the use bottled water because of environmental impact (Brita Water Filters) y Bottle deposits on water in some US States y Recession and inflation having an effect on cost and the amount of disposable income one has y Competition from other soft drinks that promote health vitamin water y Similar product Real Alkalized Water

External

Competitive Analysis
y Increasing competition for the market share of bottled water. According to the US Census Bureau there was a 65.6% increase in bottled water manufacturers in the US from 1997 to 2002. The market for bottled water is increasing. According to the US Census Bureau there was a 132.4 increase in the value of shipments of bottled water in the US. 1997 NAICS Description Year Establishments Value of shipments ($1,000) 1,826,678 785,869 132.4 Annual payroll ($1,000) 213,523 132,426 61.2 Paid employees

NAICS code

312112

Bottled water mfg

2002 1997 % change

250 151 65.6

6,722 4,661 44.2

Customer Analysis - The customer interested in BASIC H20 would be:

y y Aging consumers worried about their bone density decreasing. Consumers interested in the health benefits of increasing their hydration by achieving an acidbase balance. Consumers who are environmentally aware. Consumers interested in supporting the non-profit organization, charitywater.org.

y y

Marketing Strategies
Targets
y y y y y Athletes Pregnant and Nursing Women Consumers aged 50+ Health conscious consumers. Environmentally conscious consumers.

Objectives
y y Increase product awareness among the target audience Inform target audience about features and benefits of our product and its competitive advantage Decrease or remove potential customers resistance to buying our product Make consumers aware that our product is eco-friendly Make consumers aware of the health advantages when consuming our product

y y y

Positioning
y y New Drinking Water with health benefits Environmental and Global Charity Messaging

Key Differences
y y y Alkaline water increases hydration and slows the rate of bone loss. Biodegradable bottles are better for the environment than plastic bottles. BASIC H2O gives percentage of profits to charitywater.org.

Pricing
y y y $2.99-12pk of 16os. Bottled water $4.99-24pk of 16oz. Bottled water $.99-16oz. Individual Bottled water

Distribution Channels
Our bottled water will be distributed through an intensive distribution channel that will allow our product to be available at a wide variety of retail stores. This will also allow our customers to have easy access to our product and safe healthy drinking water. Once our products have reached the market, we will send out coupons for free samples and offer free samples in the grocery stores where our product is being distributed. We will distribute free samples to the major businesses, restaurants, and schools.

Promotion Strategies
y y y T.V. commercials Magazine and news paper ads Internet ads

Evaluation and Control

Defining Success
y y y y y y Know the business Know your market Know your competition Craft your message Deliver your message Funnel your marketing

Implementation Milestones
y y y y Production of the finest water available Providing a plastic bottle that is not a contaminate Providing a plastic bottle that is recyclable Creating a safe and clean drinking water at a competitive price

Contingency Planning
y y y y y y Insurance Environmental Issues OSHA standards Financial safeguards Back up system Government regulations

Appendices
Detailed Financial Projections
y y y The bottled water market is expected to double its sales the next 2 years Starting the company with our first and main product of bottled water Reinvesting profit to create marketing plan for additional products to introduce

Bibliography
Ashford, Nicholas Askounes, and Charles C. Caldart. Environmental Law, Policy, and Economics: Reclaiming the Environmental Agenda. Massachusetts: MIT Press, 2008. This book includes information about the nature and origins of environmental contamination of water. This book could be used to help us market our bottled water. Providing information to the customers about the contamination of water could help us to ensure them that our bottled water isn't contaminated and that it is pure and safe to drink. Barry, Jennifer. Green Marketing for 2010. Bottled Water Reporter, Nxt Book. 23 Feb. 2011 <http://www.nxtbook.com/ygsreprints/ygs/G12345_IBWA_DecJan0910/#/18>. This website discusses the operation of Going Green and making sure that bottles used are less toxic for the environment and marketing campaigns should be used to show the changes being made to help follow this standard. Recycling is one of the simplest and most widely available avenues for consumers and corporations to reduce their environmental footprints. Baskind, C. Five reasons not to drink water. 1 Jan. 2010 <http://lighterfootstep.com/2008/05/...>. This web site talks about five reasons not to drink bottled water. Using this web site might help us to improve our bottled water products so that there aren t reasons not to drink our bottled water. Bottled Water. Columbia University Water Center. 20 Feb. 2011 <http://water.columbia.edu/?id=learn_more&navid=bottled_water>. Provides an overview of the history of bottled water, from the days of the Roman Empire to the present. Discusses the beginnings of bottled water regulation, and the advertising and marketing efforts of major bottlers to distinguish themselves from their competition. Touches on some current controversies surrounding bottled water. Casabona, Bart. Pepsico s Aquafina Launches the Eco-Fina Bottle, the Lightest Weight Bottle in the Market. PepsiCo. 25 March 2009. <http://www.pepsico.com/PressRelease/...html>. This press release announces a plastic bottle, called the Eco-Fina and made for Pepsi, which contains 50% less plastic than previous bottles. In addition, new cardboard packaging is discussed for this bottle, which seeks to further reduce waste. Enhanced bottle aesthetics and an appeal to consumers environmental concerns are highlighted. Green, Jasmine. Biodegradable Plastic. Care 2 Make a Difference. 31 Jan. 2011 <http://www.care2.com/causes/environment/...>. This website discusses different options for biodegradable plastic, specifically options made from corn, hemp and feathers.

Heil, D. P. Acid-Base Balance and Hydration Status Following Consumption of Mineral-Based Alkaline Bottled Water. Journal of the International Society of Sports Nutrition. 31 Jan. 2011 <http://www.ncbi.nlm.nih.gov/pubmed/20836884>. This article is a study of the effects of drinking mineral-rich alkaline water on healthy adults and their acid-base balance and hydration status. Koch, Wendy. USDA Unveils New Green, Bio-Based Label. USA Today 19 Jan. 2011. This article describes a new USDA label available to products or packaging that are made up of biodegradable ingredients. Plummer, J. Is bottled water safe? 8 Dec. 2009 <http://www.articlesbase.com/wellness-articles...>. This web site offers information about how bottled water is not the safest type of water to drink. Some bottled water comes from public water sources where the water is treated. A water filter is the only way to ensure that the water you drink is clean and free of contaminants. This web site also offers information about what filtration systems are the best on the market. These filtration systems are the competitors and they can offer ideas. Rodwan, Jr., John G. Confronting Challenges. Bottled Water Reporter. 23 Feb. 2011 <http://www.bottledwater.org/public/...pdf>. This article has some great statistical information about bottled water and how well it is doing compared to previous years. Despite an uncharacteristically staid performance in 2008, bottled water remains a beverage industry phenomenon. It stands as the second-largest beverage type in the U.S. market and for many years also ranked as the most vigorously growing category. The bottled water industry has risen by twice as much since 1997 and it will continue to do so. Senior, Dorothy A. G., and Nicholas Dege, eds. Technology of Bottled Water. New Jersey: WileyBlackwell, 2005. Contains ten- to thirty-page sections written by various authors on topics ranging from types of bottled water to water treatment methods to safety and ethical concerns to bottling equipment and technology. Covers all types of water, including purified, mineral, sparkling, and carbonated. While much detailed information is presented, the book contains a definite pro-bottled water industry slant. Wynn, E., M. A. Krieg, J. M. Aeschlimann, and P. Burckhardt. Alkaline Mineral Water Lowers Bone Resorption Even in Calcium Sufficiency: Alkaline Mineral Water and Bone Metabolism. Centre of Bone Diseases. 31 Jan. 2011 <http://www.ncbi.nlm.nih.gov/pubmed/18926940>. This article is a study of the effects of the consumption of alkaline water on bone loss in women with a normal calcium intake.