We are currently living in a world of electrical gadgets and these power hungry little appliances require batteries to keep them going. The total battery market is worth pound;350m, according to Energiser, and it claims to be the only major battery brand in growth, adding over pound;10m a year in incremental sales, and producing more than six billion battery cells annually.
Alkaline type batteries hold the lion’s share of sales with a 75.3% stake in the total market. Rechargeable and specialist products are driving steady growth across the category and the rechargeable battery segment is worth pound;8m – up from pound;3.5m at the end of 2004. AAA battery sales rose 14% in 2006 to pound;72m.
Consumer thirst for new technology is having a profound effect on the battery category. Devices are increasingly considered critical to our lifestyle, but some are also immensely power-hungry so battery life is a key selling point.
Sarah Richardson, marketing manager of Energizer, says: “Selling the right batteries to power a range of devices is critical to meeting consumer need and growing your profits. To help consumers clearly differentiate between our batteries we have split the range into Everyday and Premium and introduced modern new packs, designed to appeal to hig- tech families. This has made it easier for consumers to identify the right batteries for their devices and this in turn will help drive sales in-store.”
Energizer also has a range of rechargeable batteries and says the rise of the ‘ethical consumer’ has created an increase in rechargeable sales.
For 2007/2008, Panasonic has a major focus on the independent sector with the launch of new Panasonic Alkaline Special Power, an exclusive battery for the convenience sector. Panasonic spoke to over 1,000 CTN consumers and highlighted three key factors, named brands, price-marks, with 83% of customers saying they would like to see price-marked battery packs at their local store and 77% of consumers saying they are more inclined to buy products that are price-marked, and batteries that will last in a variety of products.
Panasonic is advising wholesalers to move their convenience retailer customers on up to new Panasonic Alkaline Special Power to ensure they offer their customers a competitively priced, long lasting battery from a brand they can trust.
Tim Clark, marketing manager for Panasonic Batteries, says: “We see a huge sales and profit opportunity for independent retailers to capitalise on the growing trend towards higher power batteries. By wholesalers moving their customers up to alkaline technology with the trusted brand name of Panasonic Special Power we believe they can maximise their battery sales and take full advantage of impulse purchases – especially now our packs are price marked.”
Martin Gormley, brand manager of Duracell UK Ireland, says: “With such substantial market share, it remains clear that Duracell is the consumer’s preferred choice of battery and should remain front-of-mind for retailers. Duracell is the brand consumers know and, most importantly, trust. Who doesn’t picture the signature copper and black battery and our trademark bunny when thinking about batteries? We invest millions of pounds in multi-media marketing campaigns each year to grow the category and drive consumers in-store.”
According to Duracell, the UK’s battery market remains a vital impulse category with 70-75% of battery buyers not planning to buy batteries when they enter a store.
Seasonality is a big factor in batteries sales and Gormley says almost 40% of battery sales are made in the run up to Christmas. However, Duracell has also been working on encouraging sales during the summer. In June Duracell launched a promotion with iTunes to provide consumers with a free iTunes download with every purchase of special packs. Another promotion is Golden Ticket, which gave consumers the chance to win iPod prizes and tickets for a variety of festivals across Europe this summer.
Paul Lettice, trade communications manager of P G UK, says: “As the market leader in the battery category, Duracell is a must stock brand for retailers of all sizes across the UK. Recent activity from the brand has included a number of high profile partnerships with amazing consumer brands.
“This year will see even more compelling consumer promotions and marketing activity driving demand. Retailers should stock up to ensure they can meet demand, drive their sales and boost profits.”
On September 26 2008 the Batteries Directive will come into force, introducing recycling to the batteries market. Uniross is already working to reduce the number of batteries in landfill sites, as it only makes rechargeable batteries and is endorsed by the World Wildlife Fund.
Peter Keen, managing director of Uniross, says: “Uniross is providing a potential answer to the issue of batteries being thrown away. It also saves the consumer money. A rechargeable battery can be recharged between 500 and 1,000 times, and on the fourth of fifth time you are already saving yourself money.”
Uniross has been researching into why people buy rechargeable batteries and has new branding and new packaging being launched in October.
Last year Uniross launched the Hybrio battery to fill a gap in the market, it can be used straight away like an alkaline battery but can also be recharged. Uniross has also launched the Compact fast charger, supplied with four AA 2700mAh batteries for power-hungry equipment like digital cameras, MP3 players and electronic games.
Keen says that wholesalers should pass on special offers to their customers to stimulate sales and encourages wholesalers to get in contact with Uniross to talk about products and POS materials.
He adds that the rechargeable market is not as buoyant as it has been in the last three years. This is possibly because sales of items that use rechargeable batteries, such as digital cameras and MP3 players, have declined due to the fact that mobile phones can now replace them.
=== distributors viewpoint ===
Sales are steady. The growth of the multiples and the number of independents struggling makes it more difficult for us but we have diversified into different products as well. Obviously the run up to Christmas is massive for battery sales due to the seasonal demand, so we’re gearing up for that.
There has been a recent increase in the number of battery brands competing at the premium end of the battery market, with each brand looking to best suit the needs of tomorrow’s devices. Energizer has introduced Lithium AA/AAA batteries that are the longest lasting on the market, nbsp;and as each new generation of devices get more and more complex, it’s fair to assume that they will need more power to drive them, so we expect this trend to continue.
The increased demand for high-drain products such as digital cameras and MP3 players has driven the sales of alkaline batteries, whereas the sale of zinc batteries has remained relatively static. nbsp;The high-end range of batteries is also showing growth, but the higher price point means that the volume is still relatively low in comparison to standard alkaline/zinc sales.
It’s in all of the major players interest nbsp;to give support to us as a distributor. Support comes in the way of images, presentations and marketing support, all of which helps us to be better informed and up to date with the latest happenings.
The run up to Christmas always comes with multipack promotions from the major players (Duracell/Energizer/Panasonic). These usually take the form of 50% extra free packs across the full range of batteries (AA/AAA/C/D/9V). Each company only releases a limited amount of such promotional stock so it’s important to plan well for the uptake and get customer interest/orders confirmed as early as possible.