Premium water made through electrolysis
Since starting his first bottled water company in Hawaii in 1980, and subsequently launching more than 50 bottled water plants in seven countries, Steven Nickolas has had a longtime fascination with the hydrating benefits of water. After studying the scientific characteristics of water for two decades, Nickolas parlayed his passion into his latest venture: the Alkaline Water Co.
Founded by Nickolas in May 2013, the Scottsdale, Ariz.-based company produces Alkaline88, an 8.8 pH-balanced alkaline drinking water that has been enhanced with trace minerals and electrolytes, explains Nickolas, the company’s chief executive officer and president.
“Water is not just water anymore,” Nickolas says. “… Alkaline88 is scientifically a more healthful alternative to traditional bottled waters as it provides for greater hydration due to its 84 trace minerals from Himalayan salt. It can be manufactured anywhere in the world using our proprietary electrolysis equipment.
“We start with completely purified water, and then re-mineralize the purified water using 100 percent Himalayan salt,” he continues. “It is then run through our electrolysis process, which produces two streams of water — one, which is acidic, and the other is alkaline. We bottle only the alkaline water and add no chemical buffers, [thus] ensuring the purity of our product.”
The premium water already is resonating with consumers. Alkaline88 has been the No. 1 selling alkaline water in Southern California for the past year, according to New York-based Nielsen. The success of the premium water segment could be aiding the growth of Alkaline88. According to Nielsen data, the segment grew 21 percent last year.
Alkaline Water Co. reports sales of just less than $7.1 million for the 12 months ending March 31, 2016, a 91 percent increase year-to-date compared with the $3.7 million generated in its 2015 fiscal year. Additionally, in the first three months of the year, the company saw growth of 200 percent and sales of $3 million in the first quarter, it says. The company is predicting $18 million in sales for its 2017 fiscal year.
Alkaline88 is packaged in single-serve 16.9-ounce bottles, 700-ml bottles, 1- and 3-liter bottles and 1-gallon bottles, and is available in more than 20,000 stores throughout all 50 states and the District of Columbia, he adds.
“We use a very sophisticated network of brokers and distributors who have successfully placed our product in stores across the United States,” Nickolas notes. “Our core business lies in our direct-to-warehouse relationships with many of the large retailers. We have recently entered into territorially exclusive distribution partnerships with many of the most outstanding [direct store delivery] DSD distributors.”
The company utilizes contract packaging facilities in Northern and Southern California, Arizona, Texas, Georgia, and Ohio to manufacture Alkaline88 using the company’s proprietary electrolysis equipment, which is paid for and installed by the Alkaline Water Co., it says.
“These contract facilities give us a significant advantage over our competitors as we continue to reduce our environmental footprint and logistical cost,” Nickolas explains.
Balanced life, balanced hydration
With a tag line of “A balanced life starts with balanced hydration,” Alkaline 88’s success lies in its simple messaging, Nickolas says.
“We started Alkaline88 with the vision that our target consumer is females between 25-50 [years old], with a college education and family. What we have found is that some of our largest consumers are Hispanic, millennial and also aging baby boomers,” he says. “We have been successful in a variety of retail outlets — from health food stores to convenience stores and from grocery to mass retail. It appears our typical consumer is everyone.”
A 30-year commitment to studying health, nutrition and the science of water has contributed to Alkaline Water’s success, Nickolas says.
“Pure water is a mainstay of any serious health regimen,” says Nickolas, who, alongside high school friend Mike Beck, began making purified water out of their homes in Maui, Hawaii, in 1978. This led to the creation of his first bottled water company, he notes.
“I was further exposed to the many scientific characteristics of water in 1995 when a group of scientists in Dallas, Texas, were the first to demonstrate the benefits of electrolysis and how it can produce water that … not only contains a higher pH but also hydrates the body better.
“In 1998, I joined two other individuals [Ken Uptain and Merlin Yockstick] and started Essentia Water, which … has become the No. 1 selling water in the health food category,” he continues. “I knew it was only a matter of time before the benefits of alkaline water would finally become mainstream.”
Nickolas predicts that alkaline water consumption could surpass the consumption of purified water in the next 10 to 20 years.
“We continue to be pleasantly surprised by the depth of the alkaline water market,” he says. “This is not a flash in the pan. … Our product helps people overcome their medical issues by staying hydrated. When manufactured properly, alkaline water made through electrolysis is by far the best water anyone could drink.”