Yale School of Management

Center for Customer Insights

Advancing the frontiers of consumer understanding

Sparkling Water: Beliefs and Barriers

August 4, 2020

If you’re anywhere in the continental U.S. right now, you likely find yourself parched in the summer heat. Many of us are reaching for sparkling waters as a healthy but fun alternative to more sugary drinks to quench our thirst. Fortune Magazine recently reported that “sales for sparkling water brands were up by 23.4% year over year in May, while total soft drinks year-over-year dollar sales grew by 15.6%.” Cross-pollination with other trends like CBD (Ocean Spray’s incubator recently released a new line of CBD-infused sparkling waters), canned wines, and caffeinated drinks has led to the creation of a new market for bubbly beverages. With Soda Stream experiencing an uptick in sales while many are quarantined due to the COVID-19 pandemic, sparkling water is now becoming even more prevalent for in-home consumption.

clear glass of seltzer water on a wooden background

What is it that makes sparkling water attractive to consumers? More specifically, how can a beverage company take advantage of this trend and compete with newer startups that currently own the category? In a YCCI Discovery Project, Yale SOM students explored these questions, leading to a number of insights into consumer beliefs about sparkling water that can be applied to improve product positioning and messaging opportunities for sparkling water brands. Researchers used a variety of approaches to primary and secondary research to determine how consumers really feel about the fizzy libation.

Uncovering Beliefs

Category Distinction

While sparkling water and seltzer are technically the same thing, consumers demonstrated that they associate the name seltzer with older, more medicinal uses and sparkling water with images of refreshment, health, and fitness. Respondents also expressed a view of sparkling water as a luxury item.

Health

The study explored, in part, how exactly healthiness functions as a determining factor in consumers’ decisions to drink sparkling water. It was found that consumers enjoyed pairing sparkling water with healthy meals, but when pairing sparkling water with lunch or dinner, individuals mentioned preferring “subtler” varieties with either less carbonation or less flavor. Individuals also tend to pair sparkling water with dehydrating beverages, like coffee or alcohol, to counter their dehydrating effects. The study also found that parents used sparkling water to curb their child’s sugary drink consumption, either by watering down juices or replacing carbonated soft drinks altogether. Across a variety of goals and triggers for consumption of sparkling water, the study found that sparkling water was overall a more fun way to drink water.

Social Signaling

Importantly, many individuals saw sparkling water not only as a healthy alternative to sugary drinks, but also as a way to avoid the judgement of others and fit in socially. For some, drinking sparkling water was a way to combat the negative reaction that they felt would occur if they chose carbonated soft drinks, especially during morning hours, in front of their peers. Interviewees also cited using sparkling water as a means of pacing themselves or as an alcohol alternative while in social situations with alcohol present. Some showed evidence of using sparkling water more broadly as an alcohol replacement for celebrations.

Originality

Sparkling water was also spoken about as a way to fit into a niche group, through discovering their unique identity. One person mentioned drinking sparkling water because artists she was surrounded with at work drank it. Another mentioned that her artistic friends at school drank it, carrying with it a certain status. Finally, there was also an excitement of discovering new flavors that consumers reported in product reviews and in interviews, particularly with certain brands. This group turned out to be largely artists, graphic designers, and those in similar creative fields.

Testing Insights

With a number of insights into consumer beliefs and behaviors, the study then put these findings to the test. Three different positioning statements were based on consumer goals: Fun, Social, and Discover. The study looked at how these different positionings affected likelihood to consume sparkling water across a variety of situations. Fun positioning focused on sparkling water as a fun way to stay healthy and hydrated. Social positioning focused on ways in which users consumed sparkling water to mingle responsibly, putting users in control of their nights out with friends. Discovery positioning drew from insights around consumers’ sense of originality and their beliefs that sparkling beverage choices reflected their own unique identity.

Results

When presented with ads using messaging that reflected the respective Fun, Social, and Discover positionings, the study found an increase in consumption intent across a range of demand moments (e.g., to rejuvenate mid-day, to have fun responsibly, etc.). The preexisting messaging of the affiliate partner organization was used as a control, so the results below are as compared against this.

Fun

The Fun positioning showed an increased willingness in consumers to drink sparkling water throughout a normal day. Women were 8% more likely to report a willingness to drink sparkling water to wake up and overall survey respondents indicated a 7% higher willingness to drink sparkling water to rejuvenate mid-day when presented with the Fun positioning.

Social

Social positioning displayed the broadest impact on consumer willingness to consume sparkling water across both social and non-social situations. Firstly, it increased users’ willingness by 14% to drink sparkling water to have fun responsibly.

Secondly, while consumer beliefs originally indicated an apprehension to consume sparkling water with meals, respondents were 7% more likely to drink sparkling water with light food when presented with the Social positioning, and respondents 35 years and older were 10% more likely to indicate a willingness to drink sparkling water with a meal. Part of this boost can be attributed to the segment of female users, for whom the message of “responsible fun” resonated beyond just their drink choice and extended to fun, responsible meal choices.

Respondents presented with Social positioning also displayed a higher likelihood to consume water throughout the day.

Discover

As with the Social positioning, the Discover positioning increased likelihood to consumer sparkling water with meals. When presented with the Discover positioning, respondents were 11% more likely to do so.

Conclusion

While the health and wellness trend continues to gain momentum, this study demonstrates that effective positioning of sparkling water must go beyond focusing only on health or even taste. A compelling positioning for sparkling water may also draw on the social aspect, signaling to others that the consumer is healthy, creative, or responsible. As our “new normal” develops following the emergence of COVID-19, any social messaging will also need to be in tune with the times and display healthy social behavior and acceptable norms. An awareness of these insights into consumer beliefs and motivations, – combined with product naming and placement –  delineate a path for any new sparkling water contender to carve out a space in the market.