Bouncing Back
by Julie Cook Ramirez
Contributing Editor

Bolstered by a resurgence in home cooking, butter sales rebound from a couple of years in the doldrums.
Once thought to be a lost art, cooking and baking are enjoying a resurgence in America’s homes and kitchens, spurred by the popularity of TV chefs.
And when it comes to cooking and baking, the clear preference is for butter. Sure, margarines and spreads have their uses with regard to bagels, toast and the like. But for professionals, butter is clearly where it’s at. And increasingly, that message is getting through to home cooks as well.
“The chefs, the folks on the foodservice side of the world, they have more of an appreciation for what butter brings to a recipe, as well as the functionality of butter that really makes it a superb choice in the kitchen,” says Jed Davis, director of marketing, Cabot Creamery Cooperative, Cabot, Vt. “As the so-called lost generation of Americans who had gotten away from cooking gets more comfortable making their way around a kitchen, one of the things they learn very quickly is the positive attributes of butter.”
The increasing recognition of the superiority of butter in cooking and baking applications has led to a positive upswing in sales. According to Chicago-based Information Resources Inc. (IRI), butter sales across supermarkets, drug stores and mass merchandisers, excluding Wal-Mart, rose 5.7 percent in units during the 52-week period ending March 25, 2007, while falling 3.8 percent in dollars, a reflection of the leveling off of butterfat prices, which were sky high just two years ago.
TOP 10 INDIVIDUAL BUTTER BRANDS*
 $ Sales
(In Millions)
% Change
vs. Year Ago
Unit Sales
(In Millions)
% Change
vs. Year Ago
Total Category$1,190.9-3.8%464.05.7%
Private Label547.2-5.1240.05.1
Land O’Lakes340.8-2.6114.28.0
Challenge59.2-1.617.83.5
Breakstone30.4-14.313.1-11.4
Tillamook25.24.38.110.0
Crystal Farms21.63.89.112.4
Keller’s18.5-14.07.82.3
Cabot18.45.26.813.4
Hotel Bar17.6-5.77.621.6
Horizon Organic12.02.92.21.2
* Total sales in supermarkets, drug stores and mass merchandisers, excluding Wal-Mart, for the 52-week period ending March 25, 2007.

SOURCE: Information Resources Inc.

TOP 10 INDIVIDUAL MARGARINE/SPREADS/BUTTER BLEND BRANDS*
 $ Sales
(In Millions)
% Change
vs. Year Ago
Unit Sales
(In Millions)
% Change
vs. Year Ago
Total Category$1,174.8-1.1%757.2-5.4%
I Can’t Believe It’s Not Butter229.1-2.5120.0-3.1
Shedd’s Country Crock192.65.197.71.6
Private Label80.0-9.778.6-14.1
Smart Balance75.833.033.626.0
Blue Bonnet71.0-6.281.0-8.8
Parkay70.5-8.149.4-10.4
Land O’Lakes64.0-2.439.0-4.7
Imperial50.4-8.066.6-8.7
Smart Balance Light44.120.122.218.2
Fleischmann’s40.3-10.625.6-13.5
* Total sales in supermarkets, drug stores and mass merchandisers, excluding Wal-Mart, for the 52-week period ending March 25, 2007.

SOURCE: Information Resources Inc.
At the same time, sales of margarines, spreads and butter blends have fallen both in dollars and units — down 1.1 percent and 5.4 percent, respectively. That’s not for a lack of trying. Spread manufacturers have been rolling out a bevy of butter alternatives, many of which claim to offer additional health benefits garnered from such ingredients as flax seed oil, olive oil and omega-3 fatty acids.
Late in 2006, I Can’t Believe It’s Not Butter, the Englewood, N.J.-based Unilever brand, introduced a Mediterranean Blend variety. Made with olive oil, Mediterranean Blend contains 400 milligrams of omega-3 per serving and 70 percent less saturated fat than butter. In addition, it’s free of cholesterol and trans fats. A light variety is also available, boasting 85 percent less saturated fat and 50 percent fewer calories than butter. Also free of trans fats and cholesterol, it offers 200 mg of omega-3 per serving.
Hailey, Idaho-based Prosperity Organic Foods Inc. recently rolled out Organic Coconut Flax Butter, a “creamy vegan butter substitute” that blends organic extra-virgin coconut oil and organic flax seed oil. Available in Original, Thai Basil, Sweet Orange and Garlic & Onion varieties, it’s not suitable for cooking, due to the sensitivity of flax seed oil to high temperatures.
Meanwhile, Smart Balance and Smart Balance Light, manufactured by Cresskill, N.J.-based GFA Brands Inc., continue to experience strong growth. The original Smart Balance now occupies the fourth-highest margarine and spreads spot, racking up a 33 percent increase in dollar sales and a 26 percent increase in unit sales. Smart Balance Light, meanwhile, holds the No. 9 spot, with 20.1 and 18.2 percent increases, respectively. The company recently bolstered its offerings with the addition of Smart Balance Organic Whipped Buttery Spread, a trans-fat-free product that is said to taste, spread and cook just like real butter.
“What the folks at Smart Balance have tapped into is the feeling that the biggest problem with butter is all the fat,” Davis says. “Because nobody has come up with a butter that doesn’t have that kind of fat content, Smart Balance and similar products have been able to capitalize on that.”
While he remains confident that Smart Balance’s consumer base is relatively small, Davis admits, “I’m not sure how to keep that from becoming a more growing trend.”
Battling the Competition
Specifically, Davis says, the problem is that consumers have shown themselves to be overly reactive to news regarding the health-related pluses and minuses of butter and spreads. With other categories, such as ice cream, he says, that hasn’t been the case.
Butter, however, is an altogether different story. “It’s very easy to hang a bull’s eye around the neck of butter,” Davis explains. “Butter just always seems to be the whipping boy.”
Seeking to keep consumers coming back to butter for everyday use, manufacturers have racheted up their R&D efforts. Crystal Farms, a subsidiary of Minnetonka, Minn.-based Michael Foods Inc., recently introduced a Salted Sweet Cream Spreadable Butter, which is designed to be “soft and spreadable” right from the refrigerator. Made with canola oil and salted sweet cream, the product is also said to be suitable for baking and cooking.
Meanwhile, Dublin, Calif.-based Challenge Dairy Products Inc. recently rolled out its own Spreadable Butter.
While debate still rages in the industry with regard to the integrity of spreadable butters, Land O’Lakes consumers have responded enthusiastically to the Arden Hills, Minn.-based company’s spreadable products, according to company spokesperson Lydia Botham.
As with so many other dairy categories, the organic butter segment is growing at a far more rapid pace than the category as a whole. Organic Valley, in particular, experienced huge gains — up 25.9 percent in dollars and 24.7 percent in units, according to IRI.
Organic Valley chief operating officer Louise Hemstead says two main factors have been propelling the organic butter segment to new heights. Obviously, one factor is the increasing availability of organic butterfat, which had been in short supply until recently. That factor alone recently enabled the company to reintroduce its European Style Cultured Butter, which had to be pulled from the market temporarily due to the shortage of organic butterfat. Introduced three years ago, the product has always been popular, in large part because of its authentic flavor garnered from its Swiss cultures.
Ironically, the other factor is the very one that has sent conventional butter sales spiraling downward in recent years: pricing. Organic products tend to carry a premium price tag, so when conventional butter prices soared, it didn't cost much more to go organic.
“At times when we’ve seen conventional butter prices come up and kiss organic butterfat, we can hardly keep organic on the shelf,” Hemstead says. “The consumer really feels they are getting an extra value with the organic butter.”
What’s more, she says,  they tend to stick with it, even after conventional butter prices come back down.  
Julie Cook Ramirez is a freelance journalist based in the Chicago area.