SodaStream: More than a one-off gift?

21-Dec-2015 - Last updated on 21-Dec-2015 at 16:44 GMT

SodaStream wants the product to be used daily by customers

When pushing a new product into the already-crowded beverage market, there’s a lot of work that needs to be done. SodaStream’s US President John Sheppard said the company’s biggest challenge is to be seen as more than just a kitschy gift item.

“We’ve got to fight that, just the idea of making it a unique, one-off gift,” he said at a session on Achieving Brand Success at Zenith International’s 2015 WorldWideBev event in New York City last week.

SodaStream allows users to turn water into regular or flavored sparkling water. It’s an item that briefly took off in sales with the American public as a home-made soda machine, but has faced challenges in recent years, said Sheppard, who became president of the company in September 2015.

The crux of the issue is this: Customers generally don’t know what the product is when they see it. He believes this can be changed with a more aggressive advertising and marketing campaign.

“If I can get it in the house, people are going to use it and they’re going to continue to use it,” Sheppard said.

Rise in sparkling water gives hope

With a rise in low-calorie, low-sugar, better-for-you beverages and a rise in the consumption of water, Sheppard feels good about SodaStream’s chances at growth. Sales of sparkling water are up nearly 60% from 2012 to 2014, according to Mintel, something that makes Sheppard feel good about the company’s chances for resurgence.

In fact, he said SodaStream sparkling water is already the most consumed sparkling water in the US, according to numbers from his company.

“That bodes well for us. Consumers are shifting to alternatives,” he said. “It’s a great market to be in right now.”

However, sparkling water is still a small part of the water market as a whole. To boot, many people still don’t know what SodaStream is or how they can use it. Many may have only heard about the company due to what he calls its “ill-fated Super Bowl ads” that got the company more negative press than sales.

To combat this, Sheppard said the company has been trying to figure out how to educate consumers, whether that happens in commercials, online advertisements or point-of-sale advertising materials.

There will, in the coming months, be a renewed focus on pushing the product, with an in-store focus on machines, Co2 cartridges and flavors.

In addition, Sheppard said SodaStream will try to push back out into the retail market by expanding its reach beyond its current 13,000 stores, including an expansion of availability in Wal-Mart where the company had previously scaled back. There will also be expanded partnerships with companies such as PepsiCo, Sunny Delight and Welch’s.

Knowing the market, emulating success

The success of this next push of SodaStream will ride on how much Sheppard and company can educate the public on the device’s benefits.

Empowerment and education will be the key for the US market, he said. The European market already favors sparkling water, but the message must be about health, empowerment and environmental sustainability in the US.

Sheppard said the main fight will be the idea that this is only a device to be used once in a while. In the US market, SodaStream can’t simply assume it will survive as a product because it’s a “unique idea”.

“It needs to be part of daily life,” he said.