Bottled water firms turn on the taps with filters, flavours and fizz

The prototype of a water filter invented by Mitte is seen in Berlin, Germany on January 21, 2020. (REUTERS File Photo)
 

BERLIN/VEVEY, February 4 (Reuters): A German firm backed by bottled water giant Danone plans to launch a sparkling-water machine for the home early next year, its chief executive told Reuters, squarely taking aim at PepsiCo’s SodaStream.

Nestle, the bottled water market leader, is also considering a machine for the home with filters, flavours and fizz that would be a smaller version of its Refill+ dispensers being rolled out in cafeterias, hotels and offices this year.

Concerns about plastic waste and the environmental impact of transporting bottled water are prompting more people to drink straight from the tap, which is in turn pushing water firms to come up with new products to keep customers on board.

“Bottled water as we know it today, I don’t think will exist in 30 years. You will see much more point-of-use solutions like ours,” said Moritz Waldstein, chief executive of Mitte, the Berlin-based company backed by Danone.

“I am of the strong belief that it will be a fraction of the market size that we have today,” he told Reuters.

The global bottled water market was worth $135.6 billion in 2019, according to market researcher Euromonitor International, and is expected to grow to $170.9 billion by 2022, with demand expanding fastest in Asia.

Like Nestle, Mitte is betting that concerns about plastic pollution and contamination of public water supplies mean consumers will want countertop devices at home that filter tap water, as well as adding fizz and flavours like SodaStream.

In 2018, a Danone fund which invests in firms responding to growing environmental awareness joined a $10.6 million funding round for Mitte, which is developing a device to purify tap water and add minerals via cartridges.

Danone, the world’s third-largest bottled water seller with brands such as Evian, Volvic and Badoit, had slightly lower water sales in its third quarter. It is also looking to boost plastic recycling and encourage alternatives - such as Mitte.

“We think there could be demand from sophisticated consumers who for many reasons will prefer to make their mineral water at home,” said Danone Chief Executive Emmanuel Faber.

Mitte said it received extra funding from its shareholders in an investment round in December, including the Danone fund, and it might raise more money as interest had been very high.

Mitte’s first machine to go on sale will both filter and carbonate water. Set to retail for about 200 euros ($220), it will mostly be sold online and Mitte will initially target top SodaStream markets such as Germany and Sweden.

The company also has high hopes for the United States. When it ran an online kickstarter campaign to raise funds in 2017, the most pre-orders for its machines came from the United States, followed by Germany and the United Kingdom.