Portable takes a go at battery sector
Portable power is the growth area of the battery category. While sales of alkaline batteries remain challenged, rechargeable batteries and chargers are becoming a bigger part of the category.
“This year, we expect overall revenue for primary alkaline batteries to decline about 3% as fierce competition among manufacturers continues to pressure pricing for round cells,” said Tim Doyle, a Consumer Electronics Association spokesman.
Lou Martire, VP trade development at Energizer, said the company has found that actually reducing promotion on C, D and 9-volt batteries has increased profitability for retailers without a loss of volume.
Fewer devices now require batteries, although consumers always will need round cells to power toys and remotes. Doyle said growth in the category exists “if you know where to look.” Rechargeable batteries, he said, are one sector seeing sales climb as consumers increasingly adopt these solutions to portable power needs. New methods, such as inductive and solar, are “fanning the flames heating up the market for rechargeables,” Doyle said.
Jason Gere, an analyst for RBC Capital markets, said he sees long-term value in rechargeable lithium-ion batteries. “People will be willing to pay up for rechargeables,” he said.
A growing part of the category is portable power systems. Last year, Energizer introduced a line of Qi-enabled cord-free charging products to the market. Qi is gaining momentum as the universal charging standard enabling chargers and devices to communicate with one another regardless of manufacturer. The company recently expanded its portfolio with a new line of Energizer Universal USB wall and car chargers and a single zone inductive charger.
Martire believed that helping shoppers make the right battery choices at the shelf — whether they need alkaline batteries for remote controls and flashlights, lithium batteries for GPS systems and digital cameras, or power options for their mobile devices — will keep the category profitable.
To help retailers optimize category performance, Energizer has rolled out the Shopper Based Solutions program, a visible permanent merchandising program that Martire said has helped retailers achieve above-average category growth.
The article above is part of the DSN Category Review Series. For the complete Batteries Buy-In Report, including extensive charts, data and more analysis, click here.