FIJI Water LLC is a U.S. based company, that market its famous brand in more than a dozen countries out of its bottling plant located in the Fiji Islands. The product concept was developed in the early nineties by David Gilmour, the Canadian-born owner and founder of Fiji’s renowned Wakaya Island Resort.1
As of 2008, FIJI Water marketed its bottled mineral water in about a dozen countries in North America, Asia, Europe and the Middle East. It was marketed as FIJI Natural Mineral Water in Europe and as FIJI Natural Spring Water in Australia. The two main markets for the product were the United States and Australia.
At the same time, the company’s relationships with the Fiji government were at the lowest point. The government accused FIJI Water of transfer price manipulations and seized hundreds of containers carrying FIJI brand. The company’s tax- free concession granted by the Fiji government for 13 years in 1995came to an end in October 2008 and the company will be required to pay corporate tax in Fiji. The new water resource tax, although much lower than the draconian 20-cents-a-litre excise, still will adding about FIJI$1 million to its cost every year. In other hand, the company was making efforts to live up to its good corporate citizenship claim by focusing on its contributions to the local communities.
In the following report you will find my selected analysis of the FIJI Water Case Study. I have chosen to respond to Question 2: What factors contributed to the marketing success of FIJI Water? And Question 5: Are the FIJI government's concerns about the "negative" contribution of the FIJI Water to the local environment justified? Does the company do enough to improve its relations with the FIJI government and the local community? What else should it do to improve those relations?
What factors contributed to the marketing success of FIJI Water?
1 James McMaster and Jan Nowak, “Natural Waters of Viti Limited-Pioneering a New Industry in the Fiji Islands,” Journal of the Australian and New Zealand Academy of Management, 9:2,2003 (Special Edition on Management Case). FIJI Water’s International Market Expansion
FIJI Water global trends in bottled water consumption and demand were very important. Since more than 90 per cent of all the FIJI Water was exported, the sales of FIJI Water in the domestic market were very small.
In 2007, Eurpoe and North America were the biggest regional markets for bottled water, accounting for 30.9 and 30.7 per cent of the world’s sales volume, respectively. Asia accounted for 24.3 per cent and the rest of the world accounted for 14.1 per cent. 2 FIJI Water had made its strategy revolve around capturing international market opportunities and strongly positioning the brand in large and growing markets for bottled water.
Conquering the U.S. Market
The United States is the very first and important international market that FIJI Water launched. Due to its light mineralization, FIJI Water was characterized by a smooth taste and no aftertaste. The light mineralization also gave the water a clean, pure taste. Many U.S. consumers instantly liked the taste of the water and, having tried it, repurchased the product in preference to the more mineralized waters. Also the company continued to educate the consumer about main advantages over other bottled water brands.3
The successful marketing equation plays an important role in the product content. One of the important elements was packaging. The packaging is the first thing that comes to the customer’s eye. For many years, all bottles containing natural water were the same—round, with paper labels. Packaging, one of the most fundamental ways to differentiate a product, was not used as such a toll in bottled water markets. Over the last decade, both companies and consumers had discovered the power of packaging in bottled water brand positioning and imagery.
Similarly to packaging, FIJI Water’s price was...