Bottled water is going upmarket

Nestlé and Danone are doubling down on premium brands

This article has been kindly reproduced with permission from The Economist and was published on 19 October 2025.

Strolling through a villa in the south of France, Lily Collins sips from a sleek pastel can. Shot by Damien Chazelle, the director of “La La Land”, this might be a trailer for a romantic comedy. It is, in fact, an ad for flavoured water.

The ad for Maison Perrier, launched last year by Nestlé, reflects the direction of the $300bn-odd bottled-water industry. The Swiss food company has sold many of its mass-market brands and is heading upmarket with labels such as Maison Perrier. Danone, its French rival, is also doubling down on premium brands like Mizone, a vitamin-enriched drink sold in Asia.

Strolling through a villa in the south of France, Lily Collins sips from a sleek pastel can. Shot by Damien Chazelle, the director of “La La Land”, this might be a trailer for a romantic comedy. It is, in fact, an ad for flavoured water.

The ad for Maison Perrier, launched last year by Nestlé, reflects the direction of the $300bn-odd bottled-water industry. The Swiss food company has sold many of its mass-market brands and is heading upmarket with labels such as Maison Perrier. Danone, its French rival, is also doubling down on premium brands like Mizone, a vitamin-enriched drink sold in Asia.

Two forces are behind the shift: environmental stress and changing tastes. Climate change is making mineral water harder to source. Torrential rains let polluted surface water seep into aquifers. Last year Nestlé destroyed 2m bottles of classic Perrier after faecal bacteria were found in a spring. Prolonged droughts in southern Europe have caused supply shortages.

Pesticides, fertilisers and microplastics often taint even remote springs. But under EU law, “natural mineral water” must be bottled untreated. Some brands have reportedly resorted to banned purification methods. Critics add that extracting water from Alpine sources and flying it around the world in plastic is unsustainable—and that bottled water can cost 1,000 times more than tap water, often with no added benefit. More than 1m plastic bottles are sold every minute. The EU has taken measures to reduce plastic waste and promote recycling. Selling glass bottles or cans may do less damage—and, with the right branding, fetch higher prices.

Meanwhile the young, especially, are drinking less alcohol. Spying opportunity, Nestlé, Danone, Coca-Cola and others are pushing flavoured and “functional” waters (with added herbs, minerals and so forth). These are not regulated as mineral water and so can be treated and branded more freely. In the first half of 2025, sales in Nestlé’s water and premium beverages division rose by 4.7% year on year, thanks to flavoured products. Maison Perrier came close to matching Perrier’s classic mineral water in sales (though supply issues held back the original). Danone’s sales of water in China, north Asia and Oceania surged by 7.7%, led by growth in Mizone.

Whether the strategy will pay off in the long term is unclear, says Kai Lehmann of Flossbach von Storch, an asset manager. Nestlé has spent heavily on automated bottling lines and infrastructure for its flavoured range. Its water division’s operating margin was 9.3% in the first half, against the group’s 16.5%. A decade ago water margins were around 12%. Competition is intensifying. And with famous actors and directors, marketing doesn’t come cheap.