1-800 Batteries is working with battery manufacturer Ray-O-Vac, Madison, WI, to test retailers’ reaction to a new product that enables customers to pick up a pre-routed phone in participating retail stores to order batteries not in stock.
“Basically it is a bat phone in the aisle and the consumer can order any battery and mobile accessory that is not carried by the store and have it shipped to their home the next morning,” said Ken Hawk, CEO of Reno, NV-based 1-800-Batteries.
“The retailers get pure profit without the inventory to manage,” Hawk said. “They love it because it doesn’t take their salespeople time and gives them more revenue per square foot of shelf space, which is a precious resource.”
The two companies are jointly sharing the costs of installing the phones and implementing the program. Ray-O-Vac will stock stores with the top five portable batteries and 1-800-Batteries, a supplier of rechargeable batteries and equipment for a variety of portable electronics, will provide the phones, which will dial 1-800-Batteries’ Reno call center automatically. Approximately 132 call center agents will take the incoming calls and arrange for next day delivery for the batteries via Airborne Express. Agents are responsible for selling, as well as taking orders from retail outlets.
The program is being tested in the Midwest, and will be live in the second week of December, said Hawk, who would not disclose which retail outlets are going to be linked to the network.
To aid in the marketing of the program, Ray-O-Vac enlisted Chicago Bulls superstar Michael Jordan to act as spokesman for the campaign in an exclusive agreement.
Because of the arrangement with Ray-O-Vac, Jordan will be featured on the web site for 1-800-Batteries and in the company’s holiday catalog. He will also be part of a $30 million television advertising campaign for Ray-O-Vac.
“Michael is such a fantastic endorser,” Hawk said, “Of all the famous personalities, his time is probably the most valuable.”
The campaign will focus on the value of time. Hawk said the campaign will be positioned on “How valuable is your time? Don’t waste time searching everywhere for the right battery.”
“Unlike standard AA, 9 volt, C and D, cell batteries, which are available everywhere, retailers have found when it comes to the model specific portable batteries they never have the right ones in stock and it has been very frustrating for them,” said Hawk.
According to Hawk, retailers using this system would only have to stock the five most popular types of portable batteries, which increases shelf space for other products. Retailers will be given an updated list of the popular batteries each quarter, and then they can carry different batteries, if they have not already been carrying them, based on their popularity.
“What’s happened in the past is battery manufacturers push their product on the retailer and they get stuck with something they can’t sell,” he said. “With a skew of several thousand batteries it gets tough to manage stock.”
Retailers who use this system will get a commission for each sale with no added cost to the consumer. Hawk said his company selected Ray-O-Vac, as opposed to another manufacturer, because of their vision that offers a cost effective solution to retailers.
Ray-O-Vac was purchased by the Thomas G. Company two years ago and was publicly traded last year.