The demand's always there

Chain Drug Review, Nov 10, 2008

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NEW YORK -- The nation's struggling economy has retailers minimizing their inventory levels and consumers keeping their holiday spending at last year's levels--if not cutting back on such expenditures by substantial measures.

But batteries will remain on many "must purchase" lists this holiday season, since they are needed to power flashlights, calculators, clocks, cameras and a wide range of other products.

Such retailers as CVS Caremark Corp., Rite Aid Corp. and Walgreen Co. are promoting brand name and store label batteries in Sunday newspapers and through in-store circulars.

Retailers are also revamping their battery center merchandising programs, establishing freestanding planograms and developing secondary displays, including front-of-store endcaps near the checkout and film processing.

"We continue to be in a growing market for portable electronics that create a variety of personal power needs," notes Kurt Iverson, a spokesman for Procter & Gamble Co.'s Duracell brand. "The battery consumer is a very important one in the drug channel, and Duracell is working with its retail partners to build sales and profit.

"Shoppers who purchase batteries are more likely to purchase many other items in the store, which turns into higher basket rings for the retailer."

The category is expected to close the year on a high note, particularly in the performance-battery segment, which Energizer Holdings Inc. vice president of trade development Lou Martire notes has been the category's fastest-growing segment. Over the summer the company rolled out Energizer Advanced Lithium AA and AAA batteries to power devices in this sector.

Energizer emphasizes that its Advanced Lithium line lasts up to 20 hours longer than Energizer MAX cells in wireless gaming accessories and up to eight times longer than Engergizer MAX in digital cameras. In addition, the company says the line is one-third lighter than ordinary alkaline batteries, a benefit that allows gamers to move quickly and easily when using a handheld remote, and helps extend the use of flash units and handheld GPS devices.

"Chain drug growth trends have been slightly outpacing the food and discount universe," says Martire. "Drug stores have done a good job implementing strategies that encourage trade-up."

At Duracell, "Don't forget the batteries" is the message being touted to parents during the holiday season. Promotions by the brand feature an eight-pack of AA batteries that includes a small screwdriver for assembling toys.

"In addition, consumers will be able to help us 'Power a Smile' by posting a photo of their child on our online site," says Iverson. "For every photo we will donate a dollar toward helping deliver toys and batteries to kids at Mattel Children's Hospitals around the nation.

"It's a perfect fit with the in-store experience that flags this program on-pack and sends consumers looking for it through an aggressive television media buy featuring Santa driving a Duracell-wheeler to deliver the toys and batteries to the hospitals."

Separately, Duracell has forged an alliance with DaneElec USA, a manufacturer of memory modules and boards for computers, digital appliances and other products, to create a full line of Duracell flash memory products that will enable consumers to boost the memory of such devices.

"Memory is great fit for Duracell, since there's a big consumer trust factor in saving family photos or key documents," says vice president and general manager Rick June. "Memory is a complementary category that just makes sense for a digital camera user who's already buying Duracell batteries to power the device."