Batteries: challengers surge in flat sector

Duracell’s pink fluffy rabbit is probably not a very happy bunny at present. Although the rate at which Britain’s biggest battery brand is losing power has slowed over the past 12 months, value sales remain down, with a fall in average price helping to drive a 4% decline on volumes down 0.8%.

The performance mirrors that of the wider sector. Value is down 2.1%, thanks in part to deal-driven falls in average price and the growth of value brands claiming to offer the same as leading brands, at a fraction of the price. Indeed, volume sales of batteries in grocery are growing, up 1.9% year on year.

At an average of 88p a battery, Duracell certainly has its work cut out justifying its price in a market where pound shops are selling packs of 16 batteries for £1, and Asda is offering a 50-pack of JCB batteries for £10. Where Duracell struggled, Energizer did better, with value and volume up slightly despite it having the highest average price, at 89p a battery.

Energizer’s slight gains come despite the brand losing listings in Morrisons and Waitrose in 2013, and thanks to strong NPD introduced in April, including enhanced PowerSeal technology to prevent used batteries leaking, and a Maxi Charger with colour-changing lights to show charging ­status. Energizer boosted ad spend to support its new launches, and claims its Ultra+ and High Tech lines saw sales rises of 17% and 20%.

But beyond the big boys is where the real excitement begins. Panasonic has nearly doubled sales and Supreme Imports’ JCB is up 157.7%, thanks to a new Asda listing and the launch of the X10 lin, positioned as a higher-grade alkaline battery equivalent to Duracell, retailing at £2 for a six-pack. JCB has also benefited from consumers ­trading up from discount ranges. “There’s been a big shift in the last year,” says Supreme MD Sandy Chadha. “Three years ago, the discounters were pushing 20/30/50 packs of cheap Chinese zinc batteries. They leaked and ruined toys, so confidence in these products was low. Those stores have now gone to branded alkaline.”

Panasonic replaced Energizer in Morrisons and Waitrose, and Tim Clark, sales manager for UK & Ireland, says keen pricing in the middle tier has contributed to the 13.2% drop in own-label sales. “The price differential between a private label and a branded battery is less noticeable for a consumer, especially when brands remain willing to promote.”

Deals, as well as increased distribution, have helped Philips achieve impressive gains over the past year, says Mike Shiel, sales & marketing manager for Philips Accessories. “We’re finding value-for-money packs are more popular than ever.”

Widening distribution in the mults, discount and convenience sectors, as well as NPD and a brand relaunch have helped Over-seas Trading’s Keep it Handy to one of the greatest gains. Launches included six packs of longer-life alkaline batteries retailing at £1.

Still, such brands are tiny next to Duracell, worth nearly twice as much as all other brands in grocery combined. But together, these brands are in 11% value growth; volumes are up 20.7%. P&G offloaded Duracell to Warren Buffett’s Berkshire Hathaway this autumn. He will have his work cut out.