The bottled water market has been flourishing in recent years, as Brazilians pursue healthier lifestyles and look for better-for-you alternatives to carbonated soft drinks. In fact, consumption of carbonated soft drinks has decreased 6% 2010-14, while consumption of bottled water and juice have grown. In 2015, the Brazil bottled water market is estimated to reach a record high R$8.7 billion in retail sales, a growth of 16% compared to the previous year, according to Mintel Market Sizes. Despite this growth, bottled water launches accounted for only 6.3% of all non-alcoholic drink launches in 2015, resulting in a five-year low, according to Mintel’s Global New Products Database (GNPD). Although the category has seen strong performance in both value and volume in recent years, this has not helped to attract new product development activity: 97% of new products launched in 2015 were of unflavored products, leaving the flavored segment nearly untouched. Thirsty for innovation As bottled water is a growing market in Brazil, companies should take advantage of this lack of launch variation – either by breaking away from the traditional style of packaging, dominated by plastic bottles, or launching new products with added flavors or other ingredients, boosting growth even further. According to Mintel’s Bottled Water Brazil 2016 report, water in a flexible pouch tops the ranking of desired innovations. Flexible pouches may be better suited for easy transportation, and marketing messages could promote the on-the-go characteristic. Water in a carton seems to have a weaker appeal, as only one in 10 consumers showed an interest, with younger consumers aged 16-24 showing the highest interest (15%). Here, vibrant, attention-grabbing designs could help to inject excitement into the market and give products significant standout. It is important to keep in mind that new designs still have to communicate at a glance that the bottle contains water, to avoid confusion with other beverages. An injection of energy and flavor in the market In terms of ingredients, energy boosting ingredients are widely popular; antioxidants and added botanicals are also of interest. According to Mintel’s Sports and Energy Drinks Brazil 2014 report, one in five Brazilians do not like the taste of energy drinks, presenting an opportunity for bottled water brands to step in with product offerings that feature added ingredients with a more pleasant taste. There is also a market for bottled water products with caffeine, B Vitamins, magnesium, and guarana. Food and beverage companies using these ingredients have positioned their products as a natural source of energy and caffeine, building associations with energy boosting products at the same time. Usage of flavored bottled water is still low compared to unflavored products. According to Mintel research, almost a third of consumers drink flavored still bottled water, while nearly 9 in 10 drink unflavored bottled water. Regarding flavors, fruit varieties are the most desired, while (unsurprisingly) spicy flavors do not seem to spark much interest among Brazilians. Adding fruity flavors could be one way to lure those who are looking to lose weight and avoid the extra calories found in most soft drinks and fruit juice, without compromising on taste. While price is a major purchasing factor for most consumers, 23% say environmentally friendly packaging is an important factor when buying bottled water. Brazilians are learning that being green can be good not only for the planet but for themselves, too. Companies looking to please these environmentally conscious consumers should look into the whole lifecycle of their products, from the ingredients to how the product will be disposed. Recycling rates are still low in Brazil, but companies can do their part through product and packaging innovation. Andre is a Research Analyst at Mintel, covering Emerging Markets in Brazil. He is responsible for the development of reports and analysis of the Brazilian market. He previously worked for IBOPE, one of the leading research institutes in Latin America, focusing on media research. You might also be interested in: Is haute the future for China’s premium bottled water market? Can beer save the world?