Rayovac

Question 1: Should Spectrum Brands enter the rechargeable battery market?

The increased popularity of high-drain devices such as digital cameras has seen an exponential growth in the use of household batteries. Rayovac Corp is the third largest consumer battery manufacturer and marketer in the world. And like its competitors (Duracell and Energizer) was looking for ways to meet this demand.

In order to decide whether Spectrum Brands should enter the rechargeable battery market a number of issues must be resolved

* Being considered an important player in the industry as a whole requires participation in the alkaline battery segment

* Establishing a market for rechargeable batteries whilst minimising cannibalisation of Alkaline battery category

* The role of customers, channels, and strategic partners are also assets that must be understood, developed and leveraged for entry into the rechargeable battery market.

The following analysis will first review each of the points discussed above and then provide a recommendation for entry into the rechargeable battery market.

Alkaline Batteries

The alkaline battery segment has been strongly dominated by Duracell and Energizer. It is a mature market. Although the cost of an alkaline battery is increasing and the consumers are seeking greater usage from a battery, consumers are still loyal to well known brand names

A SWOT analysis of Rayovac’s alkaline battery offerings is show below

Strengths * Equivalent quality to competitors * Lower price than competitors | Weaknesses * Low brand awareness amongst consumers * Lack of strong relationships with retailers |

Opportunities * Increasing cost of one of use batteries allows Rayovac to appeal to cost conscious consumers looking for value for money * American consumers prefer convenience | Threats * Competitors reducing price * Competitors may block relationships with retail partners by offering better discounts |

Rayovac needs to...