Performance, price charge battery buying

Drug Store News, Dec 11, 1989

Performance, price charge battery buying

Performance, price and past experience are all considered by consumers when they buy batteries, Drug Stores News' Consumer Brands Preference Study shows.

Chain buyers often maintain batteries are commodity-type products. Thus, consumers respond mostly to price and impulse displays. Stores have heavily adopted off-shelf promotions to cater to this.

Yet, merchandisers add, brand name is important to an extent: The brand has to be either Eveready, Energizer or Duracell. These brands have dominated the drug store channel, in part through the clout they've built with consumers. Their aggression has equally endeared them to store managers, who reap high margins and rapid sell-through.

The vendors are spending millions of dollars a year in tooth-and-nail efforts to project distinct brand characteristics for the products. Long life has been the main theme.

Thirty-four percent of consumers named Duracell alkaline batteries as their favorites. Ralston-Purina's zinc-carbon Eveready plus the Energizer alkaline line gained a total of 41.2 percent, with 15 percent naming the Energizer. Store managers even more strongly favored the two leaders.

Both vendors have benefited this year from their television adds employing toys to convey the assertion the batteries last longest. This is a key feature that consumers respond to, industry execs say.

Eveready's "bunny" ad, launched in October 1988 on the heels of similar Duracell toy ads, sparked wide consumer response. That enthusiasm has continued with the October 1989 launch of the innovative 60-second "bunny" series in which the rabbit disrupts several simulated commercial spots. Eveready has since launched a promotion in which each store will receive a bunny to auction off to consumers.

Duracell's different tack has been to educate the consumer on battery shelflife through TV ads. Vendors now promote the "freshness dating" on packaging, also.

While this emphasis on product attributes is seen as key, price is apparently no less important. The leaders continue to offer a constant stream of coupons and rebates. Eveready took a new angle this spring by offering premium values of free batteries, or "instant gratification," with two free double AAs in a six pack, and one free C or D in a three-pack.

A high number of consumers mentioned price as the reason for making their brand choice -- 23 percent of the total (with 12 percent saying lowest price was the buy-inducing reason.)

A high percentage -- 15 percent -- said they bought the batteries because "they last longer." Only 1 percent, in contrast, said they made the decision based on the "Copper Top," the Duracell battery which the company has attempted to highlight.

After price and perceived product benefits, brand attributes gained less mention than with some other drug store items. The top attribute was good past experience, cited by 31 percent of those who said they are brand loyal.

Though 80 percent of consumers said they purchase a regular brand, 43 percent said they would buy a substitute if the regular brand were out of stock. That was the highest percentage in any general merchandise category surveyed, and supports the view of batteries' commodity character.

The survey indicates that Ray-O-Vac, despite a recent push into the drug store channel with its Smart Pack configuration, still has a way to go. It also seems to reflect the stagnation of the Kodak battery that some drug chain buyers report.

Even though last year Kodak integrated its battery and film sales forces, the company's strategy of underpricing Eveready and Duracell hasn't paid off in better market share. After three years, it's still losing money on the business, one industry source asserted.