TESTING THE CHARGE

JONATHAN SISKIN

On-battery testers, introduced last year as a technological innovation and added consumer convenience, have failed to spark shopper interest or awareness, report chain supermarkets.

This appears despite the fact that Duracell and Eveready poured millions into developing and promoting on-battery testers, and their market research indicated upwards of 90% of consumers liked the testers after they tried them.

According to retailers and wholesalers polled by SN, it's pretty much "business as usual" for this $1.9 billion category, which posted an overall sales gain of 6% for the year ended Dec. 1, 1996, reports Information Resources Inc., Chicago.

Said Bill Liesenfeld, nonfood buyer, Sak-N-Sav, Houston, on-pack testers have so far been a nonfactor in driving sales in this category. "Our stores are in low-income areas, and for our customers, battery sales are primarily price-driven. Generic brands, which cost up to 80 cents less per package of four AA batteries, typically outsell both Duracell and Eveready, " he said.

As far as battery brands go, however, there continues to be heated competition between the two major players. According to market share data compiled by ACNielsen, Schaumburg, Ill., statistics for the third quarter of 1996 reveal that Duracell remained the leader with 48% of the domestic market, followed by Eveready with 35%.

The ongoing battle for market share between Duracell and Eveready heated up last spring when both of the industry's main suppliers introduced on-battery testers. Duracell and Eveready are currently the only battery manufacturers offering these innovations.

Duracell initially launched its on-battery testers in April 1996, on PowerCheck AA batteries only. On Jan. 9 of this year, the company announced it will begin shipping PowerCheck batteries to retailers this spring, in AAA-, C- and D-sizes.

Meanwhile, Eveready simultaneously leaped into the fray last spring with the introduction of Energizer on-battery testers on AA-, C- and D-size batteries. In January it announced that the AAA Energizer on-battery tester will be available in early 1997.

Eveready is also launching a new Energizer "Win on the Spot" promotion, offering consumers a chance of winning up to $250,000 in cash prizes. Prepacked display units will carry specially marked packages announcing the contest. By pressing two green dots on the battery, consumers will know instantly if they are winners when the word "win" appears.

"We have always had a strong market for batteries, but I have not seen any particular increase in sales due to the introduction of the on-battery testers," said David Lynam, nonfood buyer at Harding's Friendly Markets, Plainwell, Mich. He also noted that consumers do not seem to be aware of the testers and have yet to show any interest in using them.

"Both Duracell and Eveready continue to heavily promote their product lines, and as a result we are also advertising batteries with more frequency than ever before. While we haven't done any special promotions to push this category, our sales strategy is to concentrate on price-point ads in local newspapers which has generated a strong response over the years," Lynam remarked. There are 32 Harding's markets spread across southwestern Michigan, with two located in northern Indiana.

Another nonfood buyer at a leading Midwest wholesaler said that while battery sales are up considerably for both major brands within the past year, he could not attribute this increase to the testers. "I have not yet heard a single comment from consumers about these testers, " he reported.

Duracell's PowerCheck batteries feature a heat-sensitive gage that is activated by pressing two dots on the side and bottom of the battery, which then gives a graduated reading within 10 seconds on the remaining battery power.

The Energizer on-battery tester utilizes similar technology that measures the power based on the amount of heat generated in the tester. However, instead of a gage, at full power the word "Good" appears in the Energizer's tester window. If the window remains black, it means less than 25% of the power remains.

"While a new technological innovation may be a nice novelty for consumers, I don't know if they're going to make a difference in terms of sales. In my experience it's been a nonissue," said Nelson Rodenmayer, a Cincinnati-based marketing director for Jacksonville, Fla.-based Winn-Dixie Stores', Midwest division. "People have to buy batteries once they go dead and they're going to continue to purchase them with or without on-battery testers."

Winn-Dixie's Midwest division includes a total of 60 Winn-Dixie stores and 27 Thriftway stores. "What drives our battery sales is the old-fashioned combination of price and demand. Before and after Christmas is always a prime time for battery purchases with all the new toys being bought, while the rest of the year sales stay fairly constant, " he explained.

Rodenmayer went on to say that within the past two months Winn-Dixie introduced its own private-label battery known as Power Charge, priced below both those of Duracell and Eveready. "With our customers, buying batteries is primarily a price issue and so we expect that our lower-cost Power Charge batteries should sell exceptionally well. "

While it is still too early to determine whether on-battery testers will significantly boost sales, both companies are bullish on the prospects of consumer interest.

"We have developed a number of exciting promotion programs to support our PowerCheck batteries this year, including new high-tech PowerCheck and 'Putterman' TV commercials and multilevel marketing support programs aimed at stimulating consumer excitement and increasing retailer traffic throughout the year," said Bruce Travis, senior vice president of Duracell USA's sales and trade division, Bethel, Conn.

"The Energizer on-battery tester is a unique, value-added product that allows consumers to quickly test the power of their batteries anywhere and anytime. Now, they no longer will be caught off-guard guessing the state of batteries in their cameras, toys, portable cassette-players and other frequently used electronic devices. In addition, the testers help consumers avoid mixing up old and new batteries," said David Hatfield, vice president of marketing for Eveready Battery Co., St. Louis.

"If you look at the history of Duracell and Eveready, it has long been the strategic goal of both manufacturers to develop more value-added features for consumers over time," noted industry analyst Carol Warner of Salomon Bros., New York.

"Duracell was the first to offer an on-pack tester, introduced in 1990, it required the user to save the package. This latest technological innovation of the on-battery tester, which is part of the battery itself, is another step up in convenience for consumers," Warner said.

While on-battery testers may not have yet directly impacted sales, the fact remains that year after year more batteries are being sold than ever before. Warner cited the rapid growth in the number of new electronic devices and gadgets on the market as the major factor for the increase. "The proliferation in sales of items such as pagers, hand-held video games, portable CD-players and cellular phones have been key in driving up sales over the past five years," she said.

Positive Charge

Domestic battery consumption has been on the rise for several years and continues to charge ahead, particularly at mass merchandisers. According to the latest statistics compiled by Information Resources Inc., Chicago, for the three years ended Dec. 31, 1996, mass merchandisers continued to capture the bulk of volume. Grocery stores posted moderate growth while drug stores remained flat.