Retailers urged to educate staff and customers on the trends in the batteries and chargers sector
The last decade has seen a huge shift in the technology we use to power our everyday gadgets and accessories. Vince Armitage of consumer batteries manufacturer Varta discusses why retailers should be working harder to align their sales strategy with the education of staff and customers on these trends.
In recent years, the batteries sector has witnessed the emergence of trends driven by consumers being more cost-conscious. The economic downturn has prompted a shift towards shoppers looking for value for money - and this has manifested into three key behaviours: searching for cut-price products in bargain retailers; a move towards innovation technologies such as rechargeable products and the introduction of more portable power charging solutions. However, a very real and significant issue for the batteries sector is that it remains driven by confused consumers - and retailers - who are tempted by quantity rather than quality and are more inclined to buy - or stock - cheap, imported multipacks of batteries over the more expensive, branded alternatives which are higher performing. In fact, for customers searching for a 'good deal', the surge in demand for bargain products has led to the reappearance of lower performance zinc batteries on the market - as identified by the research group Mintel and also statics gathered by the European Portable Battery Association (EPBA).
A battery is a battery, right?
There are currently three common chemistries in production for disposable batteries - zinc carbon, alkaline and lithium. Each of these is positioned at a different price point to reflect performance. However, with price affecting purchasing decisions, it is vital that retailers educate both staff and customers on what these different chemistries - and price points - actually offer. For example, the zinc carbon batteries which make up the vast majority of cheap multipacks sold in discount stores do not have the lasting power of the more expensive, higher performing alternatives. The price per unit is low and the volume sold is high but, for the customer, this leads to a false economy. More zinc carbon batteries will need to be purchased to achieve the same result compared to their alkaline competitors.
While, on the face of it, this seems like a shrewd move by discount retailers to increase profits, in fact it delivers a very poor service all round - consumers feel dissatisfied by the battery performance and will be out of pocket in the long run while retailers will lose out on repeat custom. This also has a significant impact on the environment as more batteries either go to landfill or are returned for recycling. This shift back to zinc carbon batteries has not been a conscious switch by consumers. Instead, they have looked for what they perceive as a cheaper alternative, not realising that they have downgraded their battery choice, swapped chemistries and compromised on performance.
Size isn't everything
The development of batteries is ultimately device driven. As a technology develops, there is always a drive to make the products as small and as portable as possible. As a result, C, D and 9V cells are not as prevalent as AA and AAA. In fact, they account for less than 20% of the market volume. Battery manufacturers are investing huge amounts of time and money into research and development of more powerful batteries to support this miniaturisation trend.
The opportunity for rechargeables
Consumers are starting to realise that the initial outlay to purchase rechargeable products provides greater value for money in the longer term - as well as offering a more environmentally-friendly approach to power needs. Recharging has always been part of the daily life of the younger generation as they have grown up being able to charge gadgets such as phones and cameras. And, this is something which they are applying to their use of batteries as well. The biggest deterrent to the growth of this sector in the past has been low retailer and consumer knowledge. A lack of awareness of how products have improved in recent years means consumers continue to focus on price as a reference point on which to base their purchasing decisions. However, the increase in consumer reliance on gadgets means we are likely to see shoppers turning to rechargeables as a viable power solution. Rechargeable technology has developed substantially in recent years, offering cells ready to use straight from the pack, increased power and shorter charging times.
On the road - portable power solutions
With power-hungry, portable gadgets commonplace, it has been necessary for manufacturers to develop a range of products which enable consumers to enjoy their gadgets whenever and wherever they are. These portable charging solutions come with a range of adaptors enabling many gadgets - such as phones, games consoles, sat-nav's and digital cameras - to be charged simultaneously. This innovation in power technology has opened up a new sales opportunity for both manufacturers and retailers.
Making the most of the batteries display in-store
With all this variety in the marketplace, one of the key challenges for retailers is gaining the knowledge of what to stock to drive footfall, sales and repeat purchases. While each outlet will have different contributing factors, such as shopper demographics and space availability, there are a few core rules to apply. Firstly, retailers should stock a solid selection of the most utilised products, with approximately 80% of the category space given to AA and AAA batteries. Retailers should work with manufacturers to ensure that the different sizes of batteries are carefully separated and labelled to avoid confusion as incorrect purchases will frustrate the consumer and damage the customer relationship. Stocking too many different brands with the same price points and positioning doesn't work.
Not only are retailers doubling their inventory and taking up increased space but they are ultimately making the battery purchasing decision more confusing for the consumer. The recommended approach is to rationalise the offering and only stock a primary and secondary brand, giving the consumer two clear options based either on performance, brand or price.
Under the Batteries Directive, retailers selling over 32kg should have a visible battery collection point. This is also a great way to display green credentials and prompt the "bring and buy effect". If a customer has just disposed of their old batteries, chances are high that they will need replacing and, by supplying battery recycling facilities, you can encourage customers to plan their battery purchases.
The location of the batteries fixture within the store needs to be well considered. Ideally, this would be within a consumer's eye line and situated at an appropriate place within the store - beside products which need batteries for example - or near the entrance or exit of a store. A secondary location has been proven to increase sales by up to 33% as it gives the retailer the opportunity to target customers twice during their retail journey. Last but not least, both the PoS and the price must be clearly visible and easy to understand so consumers can make their decision quickly and efficiently. Additionally, staff should be fully educated on the different products, technologies and price points available so they can offer customers advice and support to make the correct purchase for their needs.
Case study: Park Garage Group boosts sales by bringing batteries out from behind the counter
Varta Consumer Batteries has recently signed up one of the UK's biggest independent forecourt chains, Park Garage Group (PGG), on a sole supply contract. PGG will stock Varta's High Energy range of alkaline batteries as well as a selection of specialist battery and promotional products at all of the 93 Park & Shop sites nationally. As part of the agreement, Varta completed a comprehensive audit of Park Garage Group's approach to battery sales. This led to a complete overhaul in which the batteries fixture was moved from behind the counter to the shop floor, allowing customers direct access to the products and the opportunity to make their purchasing decision without the pressure of a queue of other customers behind them. The move also allows staff to work with customers more closely to determine the best battery to meet their needs. Over 75% of battery sales are made on impulse, so if customers do not have the products directly in front of them, retailers can miss out on vital sales. In this particular instance, the movement of the batteries fixture onto the shop floor - and the education of staff - has significantly boosted category sales, more than doubling previous figures.
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