Butter was something of a dirty word a few years ago. As consumers were encouraged to follow low-fat diets, yellow slabs of butter were viewed by many as at best an indulgence and at worst a short cut to ill health.

But with TV chefs happily chucking it into their dishes and the trend for all things natural, the public is once again learning that - in the words of an old TV advertisement - 'no buts, it's got to be butter'.

"Consumers are looking for pure, natural products with provenance, while they see celebrity chefs using butter in cooking," says Kerrygold sales and marketing director Ray Levett. But he adds: "There's a clear division in terms of usage now. Pack butter is generally used for cooking while spreads are more convenient."

Jane Gosney, Rachel's Organic marketing manager, adds: "Butter still has a key part to play in the market. As consumers demand more natural food, the pure nature of butter is very popular. There has been strong growth of both salted and unsalted butter over the past couple of years."

Butter may be back in favour, but consumers have not fully returned to their old ways. According to TNS, spreadable butter has overtaken the traditional block format for the first time, as consumers look to marry taste with convenience.

Indeed, everyday block butter has suffered its second consecutive year of decline, down 7.5% to £158m [TNS 52 w/e 23 April 2006]. Spreadable has experienced a second year of double-digit growth, up 18.4% to £187m.

Lurpak's fortunes are a case in point. Since the launch of Lurpak Spreadable in 1997 to buck falling butter sales, spreads have taken more than 75% of the brand's total sales. While its block variant has dropped 8.4% in value share to £29.3m, its spreadables have grown 9.5% to £132.4m [IRI Infoscan 22 April 2006].

There has been a similar trend with Anchor, with block sales down 8.3% but spreadables up 21%.

There has been a flurry of NPD in the spreadables sector in recent months, such as Kerrygold's Lighter Softer Butter - a 100% pure softer butter with 25% less fat but without vegetable oil, and Lurpak Spreadable Unsalted.

Although these new packs offer consumers variety in a traditional category, there are other concepts on shelf that offer butter lovers even more choice.

Those with allergies, for example, are picking up goats' butter instead, reports St Helen's Farm. It is seeing a 24% year-on-year rise in sales - despite a 250g pack costing a premium of £1.39 - and says the category is worth £1.5m.

"People usually move from goats' milk to goats' butter and we expect to see a similar growth to that experienced by the soya milk category," says marketing manager Mike Hind.

Most of the big brands regard promotions as key to future growth.

Kerrygold adverts are appearing on TV this summer running alongside a sampling campaign, while Lurpak is investing in its biggest single promotional spend with the Perfect Breakfast, which gives the chance to win a weekend away at a continental hotel.

Anchor is set to join the fray, with an on-pack promotion and TV commercial being launched this month.

Meanwhile, Country Life is making a £6m marketing investment later this year for its newly launched Lightly Salted Spreadable, which contains 0.9% salt.

Organic A category of contradictions

Organic could be seen as something of a contradiction in the butter category where brands are keen to

reinforce their natural


Anchor, for example, ditched its organic offering some years ago, as brand manager Caroline Baker explains: "Anchor butter is seen as so close to nature anyway that doing something organic could cast doubt on what's in your other products."

Kerrygold admits that it is considering an organic launch, but says the sector is currently left pretty much to the organic specialists.

Chris Mutch, trading manager at Musgrave Budgens Londis, says: "Organic isn't huge, but it's important to offer the choice, and at Budgens and Londis we have block and spreads from Yeo Valley."

Yeo Valley is now a major brand in the chiller cabinet and although the manufacturer says organic butter is about a decade behind organic yoghurt, in terms of market development it does not see why butter should be any different.

Yeo Valley marketing director Ben Cull says: "While some products are seeking to grow sales with health claims, such as added Omega-3, products made with organic milk don't need anything like that. Organic milk is already naturally rich in Omega-3."

There are fewer margarine organic offerings, probably because most buyers prioritise cost over provenance.

"People buy margarine because it's cheaper and convenient," says Andrew Mackintosh, head of sales and marketing at organic wholesaler and distributor Suma Foods. "There's a direct correlation between producing organically and the cost of the raw product."

He adds that people are becoming more aware of the issues surrounding traditionally sourced palm oil, the production of which can destroy animal habitats. "Accountability and sustainability are increasingly important to people." n