It wasn’t long ago that asking for butter with your meal would herald a sideways glance and a tut from your host. In fact, it seemed to some people that there was no bigger indication of a lack of self-care than liking a knob of the yellow stuff on your toast. Well, like all good bits of food hysteria, this one seems to be firmly in reverse, with the big news in the butters, spreads and margarines (BSM) category being that good old-fashioned butter is back in vogue.
That’s the total amount value sales of BSM are estimated to reach this year, according to Mintel
Once passed over by health-conscious consumers because of its high calorie content, the classic yellow fat is enjoying a renaissance as canny manufacturers reframe it as a natural product with impeccable provenance.
So while sales of ‘health’ spreads plunged 7.4% last year, according to Kantar, Brits bought 8.7% more blocks of butter and 6% more spreadable tubs.
“I’d definitely say we sell more butter than spreads - and it’s been that way for a long while,” agrees Abbie Houston, co-owner of the Abbiecraig Services c-store in Fife.
“I’m definitely a ‘butter person’ myself! I think butter’s success may stem from the way there’s lots of news about how margarines aren’t particularly good for you.
“I also think that people are going back to basics. And so one of the things they’re buying more of is butter.”
Stuart Ibberson, business unit director at Arla Foods, confirms Abbie’s theory. “More consumers are now following an ‘everything in moderation’ approach and are taking a more holistic view on health,” he says.
“Added health benefits are a growing interest within the category as people are becoming more and more concerned for their wellbeing. As with other categories people are showing that they are willing to pay more if the extra money goes to the farmer. Other trends include added flavours and textures such as chillie or garlic.”
Liz Spooner, graduate buyer, fresh produce, Spar
“Rather than just counting calories or looking at the saturated fat content, they’re paying more attention to what is in a product and, as a result, don’t necessarily deem low fat as a healthy option if it’s packed full of e-numbers, additives, preservatives and stabilisers.
“As a result, many consumers are now switching away from these products into the more natural and taste-led sectors such as spreadables and block butter because they trust them and know they can deliver a quality product.”
However, as good retailers know, national trends don’t always translate straight into local markets. Grant Scrimgeour, retail services manager at Dundee University Students Association Premier store, says that for his customers - primarily young people - spreads are the top choice.
“Our customers’ average age is 20 and they all tend to go for spreads over butter,” he explains.
“In fact, I’d say we sell seven to one in favour of spreads. Although, when Utterly Butterly is on promotion we sell plenty of that, too.”
He believes that his market still associates health with spreads rather than butter although for these thrifty consumers price is a massive factor, too.
The big guns
So what are the best-sellers in-store? As you’d expect from such an established category (with 99% penetration in the UK, according to Mintel) the chiller is dominated by heavily-advertised names such as Lurpak, Flora and Anchor.
Mintel says that 80p in every pound spent on BSM goes direct to the biggest household players: Arla Foods (Lurpak and Anchor) Unilever (Flora) and Dairy Crest (Utterly Butterly). It’s a statistic borne out by sales on the shopfloor.
“We have five players that dominate what we stock - including own brand,” says Scrimgeour. “In our store it’s these - including big sellers such as Flora - that make up about 70% of the volume.”
The category lockdown by the main brands means that BSM isn’t always considered, as Scrimgeour puts it, “the sexiest category in the store”. But HIM’s research on typical BSM shoppers should be enough to set retailers’ pulses racing.
According to HIM, BSM shoppers spend an average of £10.51 per visit (compared with £6.04 for the average customer) and put more items in their basket (5.4 items versus 2.8).
Interestingly, half of HIM’s interviewees said that c-stores should consider putting more variety of pack types and sizes in the chilled category, too - which suggests they’re looking for more than the standard convenience pack.
Manufacturers’ relentless focus on promotion means that brands are being forced to up their game in producing eye-catching on-pack activity that gives consumers even more of an incentive to buy. For example, Lurpak’s current loyalty scheme attempts to hook customers with a chance to claim high-end kitchen equipment.
Liz Spooner, graduate buyer for fresh produce at Spar, says that retailers will see even more activity appearing on packs in the future. “This is a highly competitive category with many people suggesting they will buy only on promotion - therefore there is an opportunity for more on-pack promotions including competitions, and driving awareness through social media,” she says.
Customers love promotions
One of the most telling stats from recent research is the number of c-store customers shopping the category purely on promotion. Some 81% of BSM shoppers thought promotions ‘important’ versus 55% of average shoppers, according to HIM.
In their stores, Grant Scrimgeour at Dundee University Students Association Premier store and Abbie Houston at Abbiecraig Services in Fife say that the proportion of customers seeking out a deal is probably even higher.
“Promotions are very important,” says Scrimgeour. “We have spreads on promotion and then we see an uplift in their sales while sales of other brands decrease.
“People are still very conscious about price and aware of the money they have in their pocket. There really is no brand loyalty out there.”
For Abbie, it’s the pricemarked packs (PMPs) that really hit the mark with her customers.
“PMPs are very important for us and I’d say that most of our stock in spreads is PMP,” she explains.
“Customers like them because they feel they’re getting better value for money.”
Hold out on price
Despite all the attention around price, retail expert Clare Rayner says that retailers shouldn’t be lowering prices of must-have products that customers would have bought anyway. And it’s worth remembering that research from HIM shows that 70% of BSM shoppers are on a top-up mission, versus 30% buying on impulse.
“Definitely get away from ‘three for two’ thinking because consumers don’t want to have to lug loads of items home with them,” she advises.
Mintel says that the fortunes of the BSM category are tied into butter’s natural accompaniment - bread. This theory is confirmed in c-stores by the volume of customers coming in to get spreads for their breakfast toast or lunchtime sandwiches.
“Breakfast and lunch are the key occasions for spreads, accounting for 84% of total usage,” says Unilever UK category manager for chilled foods Nick Hart.
“Since the recession started, homemade breakfasts and lunches have enjoyed a revival, up 3% and 3.4% respectively since 2008.”
Liz Spooner says that the category’s close ties with set meal occasions could prove a problem in the long-term, although the ‘Mary Berry’ home baking effect might provide a welcome uplift.
“The category has faced increasing competition from alternatives such as healthy breakfast bars,” says Spooner. “On the other hand, the economic times have bought a trend of home baking which is seeing an uplift in the category.”
Abbie at Abbiecraig Services says that the key time for buying butters and spreads at her store is in the evening as workers rush home from the office. “Another is Saturday morning,” she adds. “Customers come in to pick out a couple of rolls for breakfast and buy some butter to go with them.”
Running out of spread or butter is a regular, and reliable, driver for getting customers in to buy. But is there any way of boosting sales further? Rayner says: “I recently read some research which said that winter is the season when customers want comfort food - so they really respond to images of jacket potatoes with lots of butter and hot buttered toast when it’s cold outside and they’re feeling depressed.
“You can also tap into popular culture, too. There’s been a real trend for home baking so you could appeal to mums on the school run by grouping together products needed to bake your own cookies with the kids.”
Lurpak goes for loyalty
Lurpak is doing more on pack activity with a new Kitchen Heroes Loyalty Scheme designed to reward customers with foodie-focused treats. Rewards include branded oven gloves, pot stands and the opportunity to win high-end cookery-related prizes. The promotion runs until March 2014 across Lurpak Spreadable 250g and 500g formats, which feature unique codes.
Anchor brings the brand together
Anchor’s new Tastes Like Home TV slots showcase the way Anchor has always had a place in family life. The ads are the first time the brand has highlighted its extended product portfolio in one place.
Kerrygold spreads the love
This September proud Irish butter brand Kerrygold went all soft with a new spreadable product. It might be a smart move since the spreadables portion of the BSM market is the largest in terms of value.
Flora splashes out on marketing
The brand’s iconic sunflower design is back, alongside a £12m marketing spend. “The new Flora campaign brings back the iconic sunflower that generations of mums know and love,” says Patty Essick, brand-building director for spreads at Unilever UK.