The poor American consumer. When it comes to what product to use on their bread, muffins, bagels and other baked goods, they just can’t seem to get a straight answer.

For years, butter’s high fat content made it the enemy, sending health-conscious consumers flocking to margarine in droves. Lately, however, alarming news about the health risks of consuming trans-fatty acids has caused many people to reconsider that decision — and reconsider butter.

As a result, butter sales have been taken on a virtual rollercoaster ride. When the pendulum swings toward margarine, butter sales drop. When the pendulum makes it way back toward butter, sales soar. That sounds simple enough, but it doesn’t take into account one complicating factor that has been gaining steam and stealing sales away from butter in recent years: trans-fat-free spreads.

“As the trans-fatty acid hype got more elevated in the media, we saw a shift toward butter because just by the nature of the product, it doesn’t have trans-fatty acids,” says Brenda Doke, associate product manager, Keller’s Creamery LLP, Harleysville, Pa., a subsidiary of Kansas City-based Dairy Farmers of America. “As more and more margarine companies came out with trans fat-free products, however, there were a number of consumers who shifted back to margarine either because that’s what they grew up with or that’s just what they were more comfortable with.”

Overall, the margarine, spreads and butter blends category has experienced less than spectacular sales — falling 4.8 percent in dollars and 7.5 percent in units — throughout supermarkets, drugstores and mass merchandisers, excluding Wal-Mart, during the 52-week period ending March 19, 2006, according to Chicago-based Information Resources Inc. (IRI). A closer look at the data backs up Doke’s theory that trans fat-free spreads have lured some consumers back to the spreads category, however.

Among the top 15 margarine, spread and butter blend brands, the only three that achieved any growth at all were trans fat-free products. Holding down the number 15 spot, Promise racked up increases of 13.2 percent in dollars and 20.6 percent in units. It was the Smart Balance franchise, however, that outshone all the rest. Smart Balance Light came in 10th with dollar sales up 49.0 percent and unit sales up 51.7 percent, while the original Smart Balance product moved up to seventh place (from ninth place last year at this time), thanks to a 24.5 percent increase in dollar sales and a 22.5 percent increase in unit sales.

TOP 10 BUTTER BRANDS*
	$ Sales (In Millions)	% Change vs. Year Ago	Unit Sales (In Millions)	% Change vs. Year Ago
Total Category	$1,246.3	-6.0%	445.0	0.5%
Private Label	577.4	-5.3	230.1	3.4
Land O’Lakes	354.1	-8.8	108.2	-4.8
Challenge	63.6	-1.0	19.0	4.1
Breakstone	35.1	2.9	14.6	7.5
Tillamook	24.5	-18.7	7.6	-16.3
Keller’s	21.4	4.2	7.5	9.5
Crystal Farms	20.9	-17.1	8.2	-12.0
Hotel Bar	18.2	8.5	6.1	3.1
Cabot	17.4	11.2	2.1	33.1
Horizon Organic	11.7	24.3	3.9	17.6
* Total sales in supermarkets, drug stores and mass merchandisers, excluding Wal-Mart, for the 52-week period ending March 19, 2006. SOURCE: Information Resources Inc.

Smart Balance spreads are manufactured by GFA Brands Inc., a Cresskill, N.J.-based company that claims to have originated trans fat-free spreads when it rolled out Smart Balance in 1996. According to president and chief executive officer Robert Harris, the government’s recent focus on the danger of trans-fats helped the public become aware of the benefits his products bring to the table.

“When we first starting talking about trans fats, no one knew what we were talking about,” Harris says. “There’s no doubt we were assisted by the huge amount of publicity by the FDA on the new labeling regulations and the danger of trans-fatty acids.”

For the most part, butter makers shrug off the notion of products like Smart Balance posing much competition. They downplay the seemingly large gains, pointing out that the growth is coming from a “small base.” What’s more, they say, trans fat-free spreads are prohibitively expensive for the mainstream consumer. Rather, they claim such products are consumed primarily by those whose doctors have forbidden them from eating butter.

“There’s a portion of the population that has been absolutely restricted from having butter, based on what their physicians have told them,” says Jed Davis, director of marketing, Cabot Creamery Cooperative, Cabot, Vt. “Smart Balance recognized that and made a run at it, somewhat successfully, by saying, ‘Hey, here’s something that serves that purpose, but is better for you.’”

Not only does Smart Balance offer consumers a zero-trans-fat alternative to butter, it also boasts a patented blend of fats that has been clinically proven to help improve the ratio of good to bad cholesterol. What’s more, it contains high levels of omega-3 and -6 fatty acids, which have been touted as beneficial for everything from heart disease to bipolar disorder.

Should butter makers take a page from the Smart Balance playbook and begin experimenting with fortified butter?

“We are always looking at ways we can improve the quality of our product and bring something more to the consumer,” Doke says. “As the lines continue to blur between butter and butter blends, there are certainly opportunities to do fortified products as it makes sense. We need to keep in mind, however, that consumers are not going to go to butter to get their vitamins and minerals for the day.”

According to Davis, studies have already been conducted in Canada regarding the efficacy of increasing the level of omega-3 fatty acids in milk, in turn raising the level of omega-3s in every resulting product made from that milk. Don’t expect to see butter packages boasting of its healthfulness anytime soon, however. According to Jerry Kozak, executive director, American Butter Institute, Arlington, Va., butter makers would be prohibited from making such claims under the Nutrition Labeling and Education Act due to butter’s high saturated fat content.

Butter makers aren’t about to cede the competitive edge to trans fat-free spreads. As an industry, Kozak says, butter makers shied away from touting the naturally trans fat-free nature of their product. But individual companies, like Reno, Nev.-based Odell’s, have taken to promoting “the health aspects of pure butter,” pointing out that butter, unlike traditional margarine, doesn’t contain any trans fats. That kind of effort might prove necessary if trans fat-free spreads continue racking up impressive sales gains, while butter turns in performances like this past year, in which dollar sales fell 6.0 percent, while unit sales held virtually still, up just 0.5 percent, according to IRI.

While such figures serve to give a snapshot of the butter category at retail, Doke cautions that IRI data must be taken with a grain of salt because it doesn’t include sales from a number of increasingly key outlets, including the burgeoning natural food store segment. That segment is proving especially key for Odell’s, which recently shifted its focus from the foodservice and ingredient markets to retail. Introduced at retail in the summer of 2005, Odell’s Seafood Butter, Clarified Butter, Original Popcorn Butter and Authentic Ghee are sold in 10-ounce microwaveable tubs.

According to Tonja Park of Odell’s sales and marketing, the company’s target market is middle- to upper-class “foodies” between the ages of 32 and 50. She and Doke agree that an increasing percentage of gourmet butter sales are taking place in natural food stores, like Whole Foods and Fresh Market. Doke credits The Food Network for feeding the “foodie” trend and encouraging people to make gourmet meals at home.

“In spite of the general trend of time-pressed consumers, there’s also this group of people that really take pride in going back to the kitchen and creating gourmet meals,” Doke says. “They want to use restaurant-quality ingredients, so they can make a restaurant-quality meal at home.”  

Julie Cook Ramirez is a freelance journalist based in the Chicago area.