“Is that a real butter patty?”
That question was asked on the 1970s TV show “WKRP in Cincinnati,” and new market research is showing that today’s consumers are asking the same question as they demand simpler, pure and flavor-packed ingredients. Their top pick in the so-called oil-and-fats food category isn’t margarine and even olive oil – it’s butter.
According to Advertising Age, butter has been growing in popularity among consumers. Grocery-unit sales of butter grew 2.19 percent in the year ending May 13, compared to olive oil’s increase of just 0.21 percent. Margarine, spreads and butter blends, however, declined by 6.24 percent. Overall, butter led with $1.5 billion sales during this period, compared to margarine/spreads ($1.4 billion) and olive oil ($706 million)
Despite butter’s burst of popularity, market research Euromonitor International expects the retail dollar sales of oil and fats product to stumble in the next few years. They predict retail sales to drop by 5 percent in the next five years. The economy is primarily to blame for the decline – as the economy improves, more consumers eat out. Additionally, consumers are growing ever-more health conscious, opting for oil-free methods of cooking instead of traditional oil or fat cooking.
Though the outlook for the category maybe be grim, there was some good news for the creamy dairy product. Euromonitor projects that butter’s volume sales will grow by 10 percent through 2016, while margarine, viewed as “artificial” by consumers, is expected to continue falling.
Land O’Lakes, a giant in the butter industry, recently started an aggressive campaign to pull even further ahead of the competition.
Earlier this year, the company introduced its olive oil-infused butter and announced a partnership with web-darling, author and county cooking mogul Ree “Pioneer Woman” Drummond. Land O’Lakes plans to reach new and younger markets with their campaign, hoping to persuade them to use the new butter variety in ways primarily dominated by olive oil, such as sautéing and pan frying.
Some butter companies are focusing on other flavor options to beat out margarine, such as sea salt, cinnamon sugar and honey. Others are focusing on combining butter with canola oil to create spreadable butter, which was first launched on a large-scale by Land O’Lakes in 2000.
Spreadable butter as a subcategory is worth about $130 million and growing.