Shoppers spent £952.7m on butters and spreads last year - a 10.5% increase over the year before. Rising shelf prices have driven this growth. To put it into context, while volume has remained fairly static year-on-year, sales were up just 0.7% in 2006.
Consumers are buying butter and spreads slightly less frequently but, on average, are buying slightly more - 0.7kg per trip compared with 0.6kg the year before.
In the past year, the key buying trends have been health, convenience and functionality.
Sales of products with specific health benefits have fallen due to a combination of factors. Taste is likely to be one of these, as many of the pure 'health' products don't match the taste consumers expect from butter. They may move over to standard brands as they start to offer healthier formulations that taste better. Another factor may be the increase in promotions in the main butter and spreads categories. The popularity of convenient spreads with healthy attributes could also be playing a part. This explains why NPD has focused on lighter, spreadable butters.
Such trends have rubbed off on other sectors, with dairy spreads developing new lighter variants in the past 12 months, including Country Life Light Spreadable, Flora Extra Light Spread and a light version of I Can't Believe It's Not Butter.
Despite this innovation in spreadables, NPD is down in the category overall. Just 2.7% of products were new to shelves last year compared with 16.5% the previous year. This will need to change if the dominance of spreadables is to be curtailed.
Somerfield, Iceland, The Co-operative Group and Morrisons overtrade in butters and spreads, which is no great change compared with last year.
Own label is growing at 22.4%, taking its value to £168.2m. The own-label shopper is likely to live in a larger household than the branded shopper, with three or more children.
Surprisingly, the own-label shopper is also slightly more upmarket and older than the branded shopper. This may have been prompted by premiumisation of the supermarkets' own-label products.
Will Duff, TNS Worldpanel