Oliver Kay worked in Zurich’s IT industry, left his mark in Silicon Valley and invested in restaurants in San Francisco. Now, he is CEO and President of SWISSeau, a company that markets and sells a premium Swiss alpine spring water in China and takes on no one else but Danone’s Evian.

You have launched your premium water SWISSeau in 2007 and chose China as your first market. Why do you think China is the right place for your product?

O.K.: Today, China is the second largest consumer market for bottled water after the United States. At the same time, there is plenty of room for growth as per capita consumption of bottled water is only 5 per cent of what we see in the United States. But not only that. A study by Merill Lynch shows that China is also the world’s third largest luxury market. People here love luxury, brands and quality and are willing to pay a lot of money for high-end products. SWISSeau is such a high-end product. We are selling premium Swiss water to people that care about their health. After the dairy scandal with melamine-contaminated milk products we believe we sell the right product at the right time in the right market.

 
How can a new brand like yours compete with established names such as Evian? How do you differentiate yourself?

O.K.:  We directly compete with Evian in the non-sparkling premium bottled water segment. I am sure the consumer is happy about this because we offer an alternative. The way we dinstinguish ourselves is by offering a pure alpine spring water from the Swiss alps with low mineral content and a balanced pH value. It is 100 per cent natural and organic as we do not treat the water in anyway to prolong the shelf life or change the flavour or the mineral content. Our water in the bottle is as pure as it come out of our pristine Swiss alpine spring. As a result, our prices are about 10 per cent higher than Evian’s.


You think many people are likely to spend RMB11 for a 30 dl water bottle?

O.K.:  Yes, I am convinced many people do spend this kind of money for a healthy product. We do not care about market domination, we are selling a niche product that appeals to a health-conscious middle-class of some 350 million people, which, by the way, is larger than the entire population of the United States.


Where do you start and what strategy do you apply to enter key markets such as first tier cities?

O.K.:  Our focus is on Shanghai and Beijing where we already entered agreements with 5-star hotels, high-end bars, health clubs and selected retail stores. Starting from 2009, we will focus on other regions but we need to be very selective as income levels are different in every province. We will probably single out 10 cities that are located close to Shanghai and Bejing.

It is strategically important to brand our product the right way. We would be silly to sell SWISSeau for a lower price than Danone’s Evian. We have a trendy life-style water that communicates quality and such a product sells for a premium price.


Expanding in the Chinese market and competing with Evian will need a lot of investment and expertise. Do you plan to do it by yourself or are you looking for a (regional) partner?

O.K.:  We never thought we could do it without a partner. We focus on what we do best, which is design, promote and market a great product. While the entire bottling process and the production of the bottles is taking place in Switzerland, we are looking for a local partner that could help us distribute and sell large quantities in China.  It takes a lot of knowledge of the local market and of course guanxi to close major deals. We could even consider a joint venture with a local company to boost our sales.

Last update : 30-12-2008

Keywords : SWISSeau, Water, Consumption, Luxury, Niche, Evian

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