Fish Out Of Water: A Newbie In Hong Kong’s Bottled Water Business
By Nayantara Bhat |Buyers of bottled water usually have their favorite brands. Although water is meant to be tasteless, many brands have a distinct flavor that consumers either enjoy or dislike. This is why most consumers won’t know that between the Watson’s Waters and the Evians, there’s a new kid on the block, hailing all the way from freezing Serbia.
Prolom Water–brand-named Prolom Voda in Russia and Serbia where it is most popular–originates from a region in southern Serbia famed for its healing and restorative powers. Nestled in the foothills of two wooded mountains, the freshwater springs are the source of Prolom’s low-mineral water, which has a pH value of 8.8. Other brands of water are in the 7 to 7.5 range, neutral on the chemical scale, where Prolom’s product is alkaline.
“97% of the food we metabolize produces acid waste, and some of the most common contributors to acidity in the body are smoking, alcohol, stress and pollution,” says Prolom Water distributor Ivan Ivanov. He says that drinking alkaline water like Prolom can help the body to neutralize the acids created daily by our bodies.
Ivanov, a serial entrepreneur with a background in tech consulting, has made Prolom’s expansion to Hong Kong his newest project. Ivanov’s sister worked at the water manufacturing plant and suggested that he attempt to bring the brand to China. After weeks of discussions with Prolom Voda executives, Ivanov received the go-ahead for the task, although they stipulated that he should take the time-worn route of using Hong Kong as a test market before expanding into China.
A roundabout route geographically, perhaps, but Hong Kong has long been a stepping-stone for multinational companies expanding into China, used as a platform to get a feel for the vast Chinese market. However, despite the advantages, setting up in Hong Kong didn’t come without its challenges. For one, opening a bank account for the company proved challenging. Ivanov says that after a string of money-laundering scandals involving Russian companies, Hong Kong banks have been making it harder for Russian nationals to open accounts.
After getting the preliminaries handled, Ivanov’s team faced another hurdle. They believed that China’s love of ecommerce applied to Hong Kong too, and got Prolom Water into the online stores of Watson’s and supermarket chain Park n Shop, along with selling it through their online platform. However, months in with costs mounting, they had sold a few cases of water–but not nearly enough to cover expenses. They knew then to abandon ecommerce and try their hand at offline sales.
Now, under the leadership of a new sales manager, the water can be found in many stores including Organic Plus and Dairy Farm. Ivanov has more clarity about Prolom’s initial missteps now as well, and is optimistic about the company’s growth.
“Another unique thing about Hong Kong–domestic helpers,” he says. “In many families, domestic helpers are in charge of cooking and purchasing food in the shops. People don't need to buy groceries by themselves or online.”
Ivanov has big plans for the next year. Amidst expanding to other chain stores in Hong Kong, he hopes to begin cross-border expansion into China, where he is confident that the ecommerce strategy will be a winner.
“The Chinese market is huge, and Hong Kong is just a starting point,” he says. “In China, for sure, I will concentrate on e-commerce and online sales.”