Perrier
Synopsis
Perrier is French mineral water, globally known as naturally carbonated spring water with low contents of sodium. In the past, Perrier controlled about 24% of the total U.S bottled water business, and was dominating half of imported bottles water sector. The market sales of Perrier sparkling water from France rapidly grew in the United States from one million US Dollars to about eighty million per year. However, Perrier now accounts for eighty percent of declining water imports in America and 29 percent of the $225 million of sales yearly in the bottled-water market, which is growing at the rate of 9 percent annually. The American public is trading low in sales of mineral water that is substituted with club soda, according to a trade source. Perrier is challenged by Khisu Mineral Water, which has apparently cured the Korean King Sejong of all illnesses. Perrier’s considerable decline of its market share in the bottled water industry seems to be very challenging for its marketing team and raises some questions of how to survive on the market and regain the previous rhythm of sales. Maybe it’s time for them to consider some inevitable changes in the marketing strategy.

Analysis
Perrier has a lot of strengths compared to its competitors. It is naturally carbonated from France, unique in its qualities, difficult to copy. It has an internationally strong brand name. So it makes sense to keep the existing product available for the market and do not diversify. From the case study we know that before the product’s price was relatively high to soft drinks but still below the price of liqueur and it was available mostly in gourmet shops. However, Perrier’s management is now suggesting to offer it in supermarket, which is not a good idea because supermarkets do their own promotions, selling their items at a discounted prices or offering them with coupons. It will have a negative impact on the product, as the product will no longer be considered as elitist.
Perrier is facing competition by Khisu Mineral Water, which has apparently cured the Korean King Sejong of all his illnesses after what he called it as miracle water.
Even though the water cured the Korean King and is called miracle, the majority of people in the United States are not familiar about the medieval history of Korea. On the other hand pretty much everybody knows about France, about its products such as special wines, perfumes, fashion, champagnes and etc. So the country of origin like Korea doesn’t give much of advantage and King Sejung doesn’t mean much to most people in America.
It was also mentioned that Perrier’s Advertising agency came up with proposal to advertise the product through radio. The advertising campaign would include historical figures such as Socrates, Julius Caesar and Dracula. The question is what do we know about those personalities. For instance Socrates drank poison, which is not considered healthy at all. Caesar suffered from epilepsy and was also assassinated. Dracula drank people’s blood.

Answers to questions 1. Should the advertising agency’s idea be accepted?
Obviously, poison, blood and sick people cannot be considered as appropriate proposal for advertising healthy drink. Consequently, the advertising agency’s idea should not be accepted and even taken into account seriously. The tone and mood absolutely did not match the idea of healthy life style and therefore does not support Perrier’s main concept and strategy in the market. The idea of beautiful woman being bitten by Dracula is trying to convey that Perrier water is as necessary for life as blood, but the way people thinking about it would be a joke. Lets not forget that Perrier’s look is considered a high-end product, but the commercial give us a picture of fun though rather than premium product.

2. How should Perrier be promoted at this stage in tis life?
In terms of advertising Perrier should consider Special Print Magazines for affluent people. In the print they can describe in more detail the facts that the water is naturally carbonated, represent its special geological phenomena, show the process of how water is extracted, how it becomes carbonated and all of the unique qualities, which characterizes the product and makes it so special. Television advertisement is not bad, but it has a limited time frame in which it is impossible to deliver all of the interesting information about the product that would be sufficient enough to attract potential customers. If you put it in radio you can see nothing of it, it’s impossible to visualize and get kind of an image of the product. Placing advertisements in magazines would enable the advertisement agency to show more images about Perrier spring, with different geological levels, illustrate how the carbonation is created, in other words deliver all of the relevant information to the public convincing them how unique their product is which would be impossible on TV ads. Perrier should also use its strong brand name and promote their water through celebrity endorsement. Celebrity endorsement was proven to be quite an effective tool to advertise. For example brands like PepsiCo are being mostly advertised by famous young celebrities. In the case of Perrier I would recommend young, famous, healthy looking athletes for instance swimmers, football players or even singers. Perrier’s management should also change their marketing campaigns and switch to the new age group between 18-25. Perrier will most likely to succeed if they also attract young people to buy their products because water is the drink all young people are into. They can advertise with words like “being in shape and getting ready for the summer”. Perrier should also promote its water in Health Magazines, emphasizing that their water unlike some other bottled water brands is naturally carbonated with over 100 million years of existence. They should also pay a considerable attention on their distribution channels and maybe start selling their water through selected high quality retail shops, as opposed to shelving their water along with cheaper brands and trying to compete through price reductions.

3. Conclusion and Recommendation.
The case wanted to show us that there is a country effect of import . For example when we buy cars, the Japanese cars, and the German cars are having extraordinary premium. Country of origin France is a great asset that Perrier has and they should defend it.
Since Perrier cannot penetrate more into the US market they still have an option to go internationally and offer their products to reach places in the world, to segments who can afford it. They can promote their product for example to the rich Persian Gulf countries since it’s non-alcoholic and prestigious drink. They can penetrate into India, China, or even Brazil and offer their product to the segments of affluent. All they can do in the US is do defend their market, but not by lowering the price, that would be totally wrong.