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Environmental Impact on Bottled Water – A Marketing Problem for Aquafina

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This report will analyze the importance of the negative effects that bottled water brings into the world. There are many environmental concerns that take place in this world, and bottled water is contributing to a large portion of that. In this report, we analyzed facts, statistics, and general rationale to assist Pepsi-Co’s Aquafina to make the world a healthier place. Over the last decade it is noted that Aquafina suffers from negative imagery from select customers concerned with its practices to the production of bottled water onto the environment. As mentioned, the evident environmental problems lie within 3 major ideas that are outlined in this report.

First of all, it is shown that the production of bottled water results in an overindulgent use of energy and water. Next, it is revealed that there is a large cost associated with shipping and procurement costs which ultimately lead to the extreme emissions of fossil fuels and gas. And finally, the mass generation of solid and plastic waste that polluted our environment with plastic bottles overpopulating our landfills. Ultimately, these findings will support Aquafina’s motivation to whether or not accept or reject our proposal into making their decision.

INTRODUCTION/OVERVIEWBottled water has been integrated into the contemporary society. Today, we see an abundant number of bottled water throughout our daily routines; whether they are on the ground or people drinking from it. This topic is important for discussion because it raises levels of ethical awareness between consumers and the bottled water industry. For instance, in 2008 it’s expected that the bottled water industry will produce revenues of 146.5 billion and will continue to grow by 4% each year following (IBISWorld, 2008). Because bottled water is such a cheap source, it is being sold at a cheap rate, in bulk, and with inexpensive packaging materials. However soft-drink manufacturers that market these products don’t regard that “cheap” rate. For something that’s very closely comparable, the price margins are dissimilar.

In most developed countries, bottled water can range from $500-$1000 per cubic meter, compared to $0.50 from municipal tap sources (Block, 2008). At this price water cost more than gasoline, absurd? No, in fact, consumers perfectly knowing the circumstances of this situation they are still willing to buy the product. In 1998, the average Canadian drank only 30 litres of bottled water per year. By 2005, that volume had doubled (Banning the Bottle, 2008). For manufacturers that sell bottled water, they face stern marketing problems,Environmentally Unfriendly Problems: The plastics being used to produce and package causes a lot of unnecessary waste. The sales of bottled water have soared to highs of $58 billion Euros ($92 billion CAD) in 2006 (Milmo, 2006). This was due to extremely excellent marketing by suggesting that bottled water is safer and cleaner than regular tap water. However with these extreme profit margins for bottled water manufacturers/Aquafina, they have yet to realize that their product is extremely unethical to the environment.

These implications have severely targeted Aquafina’s brand image and might have a large impact on sales in the future. Throughout this report there will be three environmental implications that will be thoroughly analyzed:•Excess use of energy and water•Large shipping and procurement cost•Solid and plastic waste generationAt the end of the proposal Aquafina will have a decision to make in regards to,1.Why should Aquafina use environmentally friendly materials to promote a clean and safe environment for their consumers and reduce on energy levels being wasted?2.Why should Aquafina add more water purification plants and warehouses on a global scale to reduce emissions on gas due to transportation cost?3.Why should Aquafina promote recycling programs to the customers to prevent excess and unnecessary waste?POINTS AND FINDINGSThe Abundant Use of Energy and WaterWith the overall consumption of bottled water on the steady rise, it raises a lot of moral questions in regards to the use of energy that’s being generated to create the bottles.

First of all, it takes a significant amount of resources in order to produce a bottle of water. The plastic used to create most of these bottles is known as polyethylene terephthalate (PET). If we analyze the amount of water bought in America in 2006, it equates to 31.2 billion liters of water. These bottles require nearly 900,000 tons of the plastic (Pacific Institute, 2006), which are drawn from crude oils. To meet the demands of American’s desire for bottled water, manufacturers must use over 17 millions of barrels of oil on an annual basis, which can evidently fuel more than 1 million cars for a whole year (Arnold and Larsen, 2006). As you can see, this is a major contributing factor as to why certain customers can start to de-value the image of Aquafina (or any other manufacturer for that matter) due to these statistics. When customers start to feel more environmentally aware, it will establish a chain reaction to local governments within states and provinces to either ban or severely limit the sales of bottled water.

For instance, the Waterloo region have already banned the sales of plastic bottles in its schools starting in 2009, and in August 2008, London, Ont., voted to ban all bottled water in city offices, recreational centers and parks (CBC News, 2008). Another notable resource being used in the creation of bottled water is water itself. Manufacturers tend to “over-extract” water from large bodies of water, this can grant negative impurities on nature as it affects the flows of the rivers, streams, ecosystems, and the natural habitat of under watered species (Gies, 2008). Another contributing factor that degrades the image of manufacturers is idea of false advertising. When consumers look at an Aquafina bottle they see snowy mountings, hinting that the water comes from a fresh spring up north. However it is reported that Aquafina drinking water is taken from public municipal sources then is filtered in a seven step process for the customer (CBS News; Lopez, 2008). Consequently, it takes roughly 3 liters of water to produce 1 liter of bottled water (Pacific Institute, n.d).

Not to mention the plants and trucks involvement on the extraction process. With dozens of trucks and vehicles coming in and out of the extraction area it’s bound to create some noise and pollution to the environment. Thus, the energy output being used to create these bottles is slowly but surely depleting our earth’s natural resources and causing unnecessary pollution to preserved natural areas. To answer the previous question asked, “Why should Aquafina use environmentally friendly materials to promote a clean and safe environment for their customers?” – The answer is simple, to promote a positive corporate image to its current and potential future stakeholders.

The Excess Shipping and Procurement CostsWith the increase in more health conscious individuals they are growing more concerned for “clean drinking water”. It’s distinguished that the world consumption of bottled water has doubled between 1997 and 2005 (Zabarenko, 2007). It’s noted that consumers who purchase bottled water consider that the water is cleaner than regular tap water. With this increase on demand, it creates added pressure for manufacturers like you, to fill those demands. In order to fill these demands, manufacturers will need to export water on a global basis. Exporting, transporting, and storage are all factors to consider when transferring bottled water. Exporting and transportation methods being used today are: trucks, boats, planes, and trains. On the latter, storage costs include; warehousing and refrigerator costs. Although a lot of corporations’ par-take on these processes, they differ then those in the bottled water industry. Water is very cheap and water is very heavy!

It is evident that water will cost a lot of money to transport and that will raise disputes on cost and emission of gasses onto the environment. For instance, one study indicated that the bottled water industry in UK generated an annual of 33,200 tons of carbon dioxide emissions through transport alone, which is equal to the consumption of energy of approximately 6,000 homes (Milmo, 2006). Whether Aquafina or any other manufacturer is transporting their bottled water by truck, air or rail they are still burning massive fossil fuels. It is noted that “more than 5 trillion” gallons of bottled water is shipped internationally. For example, consumers in San Francisco can now buy water from Fiji which is approximately 5500 miles away to satisfy their demand for “Fiji water” (Leal, 2007). In the perspective of Canadian’s, arguably they have the “clearest and purest” tap water that anyone can possibly drink (Nagel, 2008).

David Suzuki, an environmental activist, argued that “buying bottled water is wrong” and it would be “nuts to be shipping water all way across the planet” and because Canadians are so “bloody wealthy” that they are willing to buy water that comes from France (Suzuki, 2007). Therefore, with the movement of bottled water being so frequent in today’s society it creates a great emission of pollution due to the trucks and planes involved with the transportation of the product. To answer, “Why should Aquafina add more water purification plants and warehouses on a global scale to reduce emissions on gas due to transportation cost?” – The answer is simple, to help contribute to the environment and help contribute to the reduction of usage of fossil fuels.

Solid and Plastic Waste GenerationFinally, environmentally aware individuals believe that bottle water is a “total unnecessary product,” says Aaron Freeman, an Ottawa-based policy director for Environmental Defense (Gilchrist, n.d). Reasons being are those discussed in the previous point, however water bottle manufacturers are still unaware or not taking more action to the largest cause that de-value Aquafina and other manufacturers alike. This negative factor is the plastic waste generation that bottle water bestows onto our society. It is apparent that American’s spend about $11 billion dollars per year on bottled water, in that process they contribute to the generation of 2.7 million tons of plastic bottles (Zwillich, 2008). Even with a 30% reduction in the amount of PET that goes into each bottle, it is clear only 15% of bottles are recycled while the remains end up in landfills where they take 1000 of years to degrade (Milmo,2006; Niman, 2007).

This is not the bad part, even if consumers were to recycle their bottled water, it is still known as a “waste of resources” because of their energy emission required to produce the product (Nagel, 2008). In this new decade, it is noted that consumers are more declined to recycle, reports indicated that the recycling rate of PET water bottles have fallen by 23.1% in the United States in 2005, compared with 39.7% 10 years earlier (Zabarenko, 2007). With the worldwide consumption on the increase; growing 12% in the United States and growing as much as 50% in newer markets such as India. Bottled water is accounted for the single largest growth area amongst all beverages that include juice, soft drinks and alcohol (Llanos, 2005).

It is known that bottled water is consumed far away from homes, where recycling cannot take place. We can see the devastating effects that these plastic bottles will have on our environment. What will become of these landfills in the next 10, 20, 50 years? The picture doesn’t exactly paint a beautiful meadow, at least not with these statistics. As a result, to answer the previous question mentioned, “Why should Aquafina promote recycling programs to the customers to prevent excess and unnecessary waste?” – The answer would be to promote a very healthy and prosperous recycling cycle amongst bottled water drinkers.

SUMMARY AND CONCLUSIONIn conclusion, as a result of these findings its noted that there is an excess use of energy, a heavy shipping cost, and finally a lack of morals in regards to waste management. The results indicated that the following arguments are true to the sense that bottled water is polluting our environment and making the world a soiled atmosphere to live in. More results that can be drawn are, there is a swift rise on the consumption of water, despite all the negative aspirations about bottled water consumers are still willing to contribute to the cause.

Aquafina needs to quickly act in order to substitute change into the world to ultimately making it a more suitable environment to live. The implications of the findings is that the results are gathered from global resources, these results might be harder to interrupt because the majority of Aquafina’s market share lies strictly between North American boarders. The next steps that Aquafina should take are gathering more information about their strongest market (United States) and start to implement change in there. It would be cheaper to implement the change in one geographic region rather than many at once, afterwards they need to interpret the results to see what major changes need to be made and start to work on a global basis.

Works Cited / Reference

Arnold, E., & Larsen, J. (2006). Bottled Water: Pouring Resources down the drain. Earth Policy Institute. Retrieved November 30th, 2008 from http://www.earth- policy.org/Updates/2006/Update51.htmBanning the bottle. (2008, August 25). The Ottawa Citizen,A.8. Retrieved November 30, 2008, from Canadian Newsstand Core database. (Document ID: 1546174121).

Ben Block (2008, November). U.S. Bottled Water Demand Slowing. World Watch, 21(6), 5. Retrieved November 30, 2008, from Research Library database. (Document ID: 1588837121).

Blumenfeld, J. & Leal S. (2007). The Real Cost of Bottled Water. SFGate. Retreived November 30th, 2008 from http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2007/02/18/EDG56N6OA41.DTLCBC News (2008). Bottled Water. Retrieved November 30th, 2008 from http://www.cbc.ca/news/background/consumers/bottled-water.htmlGies, Eric (2008). Rising Sales of Bottled Water trigger Strong Reaction in US. International Herald Tribune: A Global Edition of the NY Times. Retrieved November 30th, 2008 fromhttp://www.container-recycling.org/mediafold/newsarticles/plastic/2008/3-19-Intl-RisingSalesOfBottled.htmGregory Lopes (2008, February 1). House probes bottled-water impact. Washington Times,C.9. Retrieved November 30, 2008, from ProQuest Newsstand (CDN) database. (Document ID: 1422295871).

IBIS World (2008). H20 = Big Business in a Bottle. Retrieved November 30th, 2008 fromhttp://www1.ibisworld.com/pressrelease/pressrelease.aspx?prid=124Llanos, Miguel. (2005). Plastic bottles pile up as mountains of waste. MsnBC. Retrieved November 30th, 2008 from http://www.msnbc.msn.com/id/5279230/McRandle, P.W. (2008) Consider It’s Life Cycle: Bottled Water. [Electronic Version]. National Geographic: Green Guide, Issue #101.

Michael I Niman (2007). Bottled Insanity. The Humanist, 67(3), 40-41. Retrieved November 30,2008,from Research Library database. (Document ID: 1275395131).

Milmo, Cahal (2006). Environmental insanity’ to drink bottled water when it tastes as good from the tap. The Independent. Retrieved November 30th, 2008 from http://www.independent.co.uk/environment/environmental-insanity-to-drink-bottled-water-when-it-tastes-as-good-from-the-tap-405955.htmlNagel, Jeff (2008). Canada: Tap water pushes over bottles. Inside the Bottle. Retrieved November 30th, 2008 from http://www.insidethebottle.org/canada-tap-water-pushed-over-bottlesPacific Institute. (n.d). Bottled Water and Energy: A fact sheet. Retrieved November 30th, 2008 from http://www.pacinst.org/topics/water_and_sustainability/bottled_water/ bottled_water_and_energy.htmlSuzuki, D. (2007). Buying bottled water is wrong, says Suzuki. CBCNews. Retrieved November 30th, 2008 from http://www.cbc.ca/canada/newfoundland-labrador/story/2007/02/01/suzuki-water.htmlZwillich, Todd (2008). Bottled Water Debate Splashe Congress. CBS News. Retrieved November 30th, 2008 from http://www.cbsnews.com/stories/2008/09/11 /health/webmd/main4440045.shtmlZabarenko, D. (2007). Bottled Water Has high Environmental Costs. PlanetArk. Retrieved November 30th, 2008 from http://www.planetark.com/dailynewsstory.cfm /newsid/41868/story.htm

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