Bottled water for free: Will this new advertising model sustain?

What if someone tells you that the bottled drinking water you purchase will now be provided free of cost? This might initially sound impossible, but that's exactly what some new Bangladeshi companies like Mizu, Magna Water and Free Flow are claiming to offer.

But of course, nothing is really free. Just think of Facebook and YouTube. They may appear free at first glance, but using them actually entails being fed with hundreds, if not thousands, of advertisements every day.

These new initiatives offering free water too will operate under a similar business model. The bottles themselves will serve as advertising space, allowing brands to display their names for promotional purposes in exchange for a specified fee. 

While this approach is likely to ensure that the companies receive funding and operate seamlessly, customers can benefit by obtaining a fundamental necessity like water without having to spend their hard-earned money.

However, the key question remains: can such a model truly be sustainable in our country? Additionally, it is important to understand how these companies will function and why there has been a flurry of multiple enterprises adopting the same model within a short span of time.

Despite widespread skepticism regarding the potential success and ethical implications of these initiatives, the proponents of these companies assert that this strategy has already been tried and proven successful in numerous other countries.

Mizu was the first company to introduce this advertising model in Bangladesh from November last year. According to Nijhum Islam, co-founder of the company, the inspiration for the initiative stemmed from the suffering of the crores of people grappling with water scarcity in Bangladesh.

"Our primary goal is not to make profit, but make water free and easily accessible to those in a vulnerable condition," said Islam. However, they are still in the phase of establishing their own brand first and hence, as of now, their operation is mostly limited to the capital Dhaka. Still, they have already collaborated with some well-known brands like Chillox, Mentors and G-Projukti.

The business model works like this: the bottled water companies receive a certain amount of money from a brand in exchange for a maximum of 1,000 bottles, print labels of that brand and a QR code. They then fill up the bottles from a BSTI-certified provider. Then, they either deliver those water bottles to the sponsor brand or assume the responsibility for direct distribution. 

However, many experts are of the opinion that this advertising model may struggle to sustain, as they may face challenges from both the big bottled water brands as well as local shopkeepers.

The mass competition in the fast-moving consumer goods (FMCG) sector, particularly in the bottled water market, is seen as a potential obstacle that could pose a threat to the viability of these initiatives. 

"Also, retailers enjoy the highest margin by selling bottled water, therefore there won't be any push from the shopkeepers' end," said Zakaria Hossain, a standing committee member of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI). 

But Mizu's Nijhum Islam clarified that their strategy is likely to remain secure, as they hold onto the direct distribution channel themselves. That means, instead of dispersing the water bottles to various retail outlets, they rather select a specific location, for example in front of an educational institution, where the sponsoring brands have the highest percentage of target customers. 

He also added that in the coming months, they have plans to extend their distribution in coastal regions like Satkhira, where the water crisis is the most severe, forcing poor people to buy water at a high price.

Magna Water's goals, however, are slightly different from that of Mizu. Co-founder Farhan Ahmed says the main philosophy lies in the fact that instead of advertisements on Facebook or YouTube, advertisements on a basic necessity like water bottle can grab more eyeballs, while also making water free for the target customers of many brands. 

"Besides, we will donate Tk1 revenue from each bottle to people suffering in the water crisis," said Ahmed. 

Tamzid Rahman, CEO of the latest start-up Free Flow, acknowledged that they are inspired by Free Water, a Texas-based beverage company offering free drinking water to people, and want to replicate its success in Bangladesh as well. 

"This strategy is generating 10x more impressions than direct mail and boasting a 29% return on investment [in the US, according to data by Free Water]," Rahman said.

He also revealed that recently the initiatives of Free Water, and its equivalent Free Paani in India, have gone viral on social media platforms like TikTok and Instagram, from where Bangladeshi social entrepreneurs are also taking inspiration. 

Even though Free Flow has yet to begin its on-field operations, Rahman said they would use aluminium bottles and paper cartons instead of plastic bottles. Both Mizu and Magna Water said they too will replace plastic bottles with more environment-friendly and biodegradable options in the coming days. 

Furthermore, all three companies have also set their sights on expanding this advertising model to other products in the future.  

Still, many within the country's marketing fraternity pointed out some other concerns that might hamper the model's success in the long run. 

According to Sazzad Chowdhury, a marketing expert and business development manager of a Dhaka-based catering service, investors will hesitate to pay the amount that will be spent on one bottle. 

"This model may have succeeded in countries like the US where people are more educated and socially conscious. But here in Bangladesh, most people just throw away bottles after drinking water, and don't care much about what's written on the labels. So, what will be spent on advertisement in these bottles will be more beneficial if spent on traditional marketing," he explained. 

Tanveer Ahmed, another marketing expert and co-founder of a matchmaking start-up, suggested that instead of resorting to these companies, client companies themselves can do the same as a promotion for their brands by distributing free water bottles in locations such as traffic signals or parks. 

Shayekh Sakif, product analyst in Pathao's product and technology department, said that he found the initiative to be a "marketing and distribution game" rather than an awareness initiative. 

"Definitely the initiative is very good but to have a sustainable business around this, brands that will monetise the business will definitely look forward to having the best possible outcome which might be a challenge," he said. 

Meanwhile, Dr Mohammad Shahidul Islam, an assistant professor of Marketing at Brac Business School, Brac University, believes that such a strategy as providing free bottled water which is sponsored by advertisement demands an all-encompassing analysis of its ethicality, sustainability and compliance with the societal marketing principles. 

"Ethically, using water — an essential need — as an advertising tool could be equated to commercialising basic needs, therefore bringing about the issue of feeding human rights with businesses," he noted. 

According to him, this ethical position may be less stringent when there is transparency and consumer consent, but the risk of abusing consumers' needs still exists. 

"As socially-oriented marketing, this concept corresponds with the idea because it directly benefits consumers and if implemented in a responsible manner, could help resolve water availability questions," he concluded.