Report: Butter, Margarine and Table Spreads - US

Scope and Themes
What you need to know
Definition
Data sources
Sales data
Consumer survey data
Abbreviations and terms
Abbreviations
Terms
Executive Summary
Health trends challenge market even as rising dairy costs create sales spikes
Competition from healthier alternatives and market' s own pricing
Butter loses share to margarine
Discount/supercenters grow on convenience and pricing
Concerns about health and weight
Heart disease increasing among women
Consumers concerned about economy and food prices
Healthy positioning doesn' t guarantee success
Land O' Lakes changes packaging for butter in multiple ways
Healthy products get healthier and more convenient for cooking/baking
How respondents use butter and margarine
Respondents' brand preferences
Attitudes and changing opinions on healthy eating
Significant differences in respondents' use by race/ethnicity
Higher usage in blacks and Hispanics
Income and butter/margarine use
Health concerns in blacks and Hispanics
Market Size and Forecast
Key points
Mature market chained to materials costs, but innovation can help
- Figure 1: Total U.S. sales and forecast of butter/margarine and table spreads at current prices, 2002-12
- Figure 2: Total U.S. sales and forecast of butter/margarine and table spreads at inflation adjusted prices, 2002-12
Wal-Mart sales
Competitive Context
Cooking sprays, cooking oil, grilling offer alternatives to butter/margarine for cooking
- Figure 3: FDMx sales of olive oil, 2002-07
Drive against use of rBST in milk production likely to increase price of butter, and possibly lower use
Segment Performance
Key points
Consumers not trading butter for margarine/table spreads
- Figure 4: U.S. FDMx sales and forecast of butter and margarine/table spreads, by segment, 2002-12
- Figure 5: U.S. FDMx sales of butter and margarine/table spreads, 2005-07
Segment Performance--Butter
Key points
Milk prices directly affect butter sales and pricing
Prices spike in 2004...
...leading to over-production
Butter prices increase but volume sales decline
- Figure 6: FDMx value and volume sales of butter and average price per pound, 2002-07
- Figure 7: FDMx sales of butter at current prices, 2002-12
- Figure 8: FDMx sales of butter at constant 2007 prices, 2002-12
Segment Performance--Margarine and Table Spreads
Key points
Less volatility, but also declining sales as consumer habits change
Consumers embrace healthier cooking methods
Economic uncertainty may result in more cooking
- Figure 9: FDMx dollar and volume sales of margarine/spreads/butter blends and average price per pound, 2002-07
- Figure 10: FDMx sales and forecast of margarine and table spreads at current prices, 2002-12
- Figure 11: FDMx sales and forecast of margarine and table spreads at constant prices, 2002-12
Retail Channels
Key points
Discount/supercenters continue to grow sales
Convenience stores and drug stores the biggest losers
- Figure 12: U.S. sales of butter and margarine/table spreads, by retail channel, 2005-07
Retail Channels--Supermarkets and Other Food Stores
Key points
Growing food prices only reason for growing sales
Continued consolidation, though slowing
- Figure 13: U.S. sales of butter and margarine/table spreads at supermarkets and other food stores, 2002-07
Retail Channels--Discount/Supercenter/Warehouse Club
Key points
Supercenters offer multiple levels of private label pricing
Sales likely to continue to cannibalize other channels
- Figure 14: U.S. sales of butter and margarine/table spreads, at discount/supercenter/warehouse clubs, 2002-07
Retail Channels-- Convenience Stores/Drug Stores and Other
Key points
Not the only 24-hour retail
- Figure 15: U.S. sales of butter and margarine/table spreads, at c-stores/drug stores and other, 2002-07
Retail Channels--Natural Channel/SPINS
- Figure 16: Natural product supermarket retail sales of butter and spreads, at current and constant prices, 52 weeks ending march 22, 2006-08
Natural channel sales by segment
- Figure 17: Natural product supermarket retail sales of butter and spreads, by segment, 52 weeks ending march 22, 2006-08
Natural supermarket channel sales of butter and spreads
Butter sales
- Figure 18: Natural product supermarket retail sales of butter at current and constant prices, 52 weeks ending march 22, 2006-08
Organic butter sales
- Figure 19: Natural product supermarket retail sales of eggs, by organic, 2006-08
Spread sales
- Figure 20: Natural product supermarket retail sales of spreads at current prices and constant, ending march 22, 2006-08
Organic spreads sales
- Figure 21: Natural product supermarket retail sales of spreads, by organic, 2006-08
Brand tables
Butter and spreads
- Figure 22: Manufacturer brand natural supermarket sales of butter and spreads, 2006 and 2008
Market Drivers
Lifestyle and attitude changes impact this market
All good things in moderation redefines butter
There is more to food than fat and calories
- Figure 23: U.S. per capita butter consumption, 2000-06
Health concerns are still an issue in this market
Overweight and obesity are serious problems in the U.S.
Are consumers changing their diets?
- Figure 24: Adult population over age 20 and adult obese population, estimates, 2002-07
- Figure 25: Share of children aged 2-19 considered overweight, by age, 1971-2004
- Figure 26: Reason to watch diet, 2005 and 2007
Heart health concerns hit women (and this market)
- Figure 27: Prevalence of cardiovascular diseases among adults aged 20 and older, by type, by gender, 2005
- Figure 28: Prevalence of cardiovascular disease in Americans aged 20 and older by age and gender, NHANES 1999-2002
Commodity prices continue to rise
Driving up food prices
- Figure 29: Changes in food prices, at and away from home, 2004-08
Leading Companies
Key points
Little overlap between segments
Healthier for you suppliers not guaranteed success
Private label not immune
- Figure 30: Manufacturer sales of butter and margarine/table spreads at FDMx, 2005-07Brand Share--Butter
Key points
Fragmented supply structure
Organic butter sales inconsistent
- Figure 31: FDMx brand sales of butter in the U.S., 2005 and 2007
Brand Share--Margarine and Table Spreads
Key points
Premium spreads with plant sterols for lowering cholesterol levels are not all succeeding
Smart Balance is succeeding
How is Smart Balance succeeding?
- Figure 32: Selected functional spreads prices in Indianapolis, indiana, april 2008
Olive oil spreads grow
- Figure 33: FDMx brand sales of margarine and table spreads in the U.S., 2005 and 2007
Brand Qualities
Do consumers want to buy food products that seem like pharmaceuticals?
How is Smart Balance winning consumers?
What are well established brands doing to drive perceptions?
Margarine brands try to replace butter in baking, cooking, or table
Butter brands struggle with private label for share
Land O' Lakes offers a consistent image to butter consumers
Innovation and Innovators
Land O' Lakes half-pound packaging and half sticks add convenience
Adapting to regional preferences
Prominent omega-3 labeling
Healthy spreads made convenient for baking
Advertising and Promotion
Overview
Individual campaigns
Unilever
- Figure 34: I Can' t Believe its not butter #1, 2007
- Figure 35: I Can' t Believe its not butter #2, 2007
Country Crock
- Figure 36: Shedd' s spread country crock ad, 2007
Smart Balance (formerly GFA)
- Figure 37: Smart balance ad #1, 2007
- Figure 38: Smart balance ad #2, 2007
Butter and Margarine Usage
Trended usage of butter, margarine, and margarine spreads
- Figure 39: Usage of butter, margarine, and margarine spreads for 2003, 2005, and 2007
Trended household volume usage of butter and margarine
Trended volume usage of butter and margarine/margarine spread
- Figure 40: Usage of butter, margarine, and margarine spreads, by amount, 2003, 2005, and 2007
Current usage of butter, margarine, and spreads
- Figure 41: Usage of butter, margarine, and spreads, by gender, March 2008
Preferences for everyday use
- Figure 42: Everyday usage of butter, margarine and spreads, March 2008
Product Preferences Based on Type of Food Preparation
Preferences for baking
- Figure 43: Usage of butter, margarine, and spreads for baking, March 2008
Preferences for stove-top cooking
- Figure 44: Usage of butter, margarine, and spreads for stove top cooking, by gender, March 2008
Brands
Popularity of brands
Brand preferences by household income
- Figure 45: Use of butter brands, by household income, May 2006-June 2007
Brand preferences by region
- Figure 46: Use of butter brands, by region of residence of respondent, May 2006-June 2007
Margarine and margarine spreads
- Figure 47: Use of margarine/margarine spread brands, by household income, May 2006-June 2007
Attitudes and Motivations
General behaviors about and attitudes towards cooking habits
Key findings
- Figure 48: Frequency of cooking, by gender, March 2008
- Figure 49: Frequency of cooking, by age, March 2008
Beliefs and behaviors related to butter use
Key findings
Beliefs and behaviors related to margarine use
Key findings
Consumer Behavior: Switching Products
Key findings
Behavioral changes by age
Behavioral changes by income
- Figure 53: Behavioral changes with regard to butter use, by household income, March 2008
Consumer Attitudes: Cooking, Shopping, Flavor, and Health
Consumer attitudes about cooking and shopping
Key findings
- Figure 54: Attitudes about shopping and cooking, by gender, March 2008
- Figure 55: Attitudes about shopping and cooking, by age, March 2008
Consumer attitudes about flavor
Key findings
- Figure 56: Butter and margarine flavor preferences, by gender, March 2008
- Figure 57: Butter and margarine flavor preferences, by age, March 2008
Health beliefs
Key findings
- Figure 58: Health beliefs about cooking and butter/margarine, by gender, March 2008
- Figure 59: Health beliefs about cooking and butter/margarine, by age, March 2008
Race and Ethnicity
Preferences and usage differences by race/ethnicity
Key points
- Figure 60: Usage of butter, margarine, and margarine spreads for 2007
- Figure 61: Usage of butter, margarine, and margarine spreads for 2007
Usage differences by race and income
Key points
- Figure 62: Usage of butter, margarine, and spreads, by race/ethnicity and household income, March 2008
Brand preference by race and income
- Figure 63: Use of butter brands, by race/ethnicity, May 2006-June 2007
- Figure 64: Use of margarine/margarine spread brands, by race/ethnicity, May 2006-June 2007
Consumer Behavior: Switching Products by Race and Income
Key findings
- Figure 65: Behavioral changes with regard to butter use, by race/ethnicity and household income, March 2008
Attitudinal and Behavioral Differences by Race
Consumer attitudes towards cooking and shopping by race and income
Key points
- Figure 66: Attitudes towards shopping and cooking, by race/ethncity, March 2008
- Figure 67: Attitudes about shopping and cooking, by race/ethnicity and income, March 2008
Consumer attitudes about flavor by race and income
Key points
- Figure 68: Butter and margarine flavor preferences, by race/ethnicity, March 2008
- Figure 69: Butter and margarine flavor preferences, by race/ethnicity and income, March 2008
Health beliefs by race and income
Key points
- Figure 70: Health beliefs about cooking and butter/margarine, by race/ethnicity, March 2008
- Figure 71: Health beliefs about cooking and butter/margarine, by race/ethnicity and income, March 2008
Appendix: Other Useful Consumer Tables
Usage of butter, margarine, and margarine spreads
- Figure 88: Usage of butter, margarine, and margarine spreads, by age, May 2006-June 2007
- Figure 89: Usage of butter, margarine, and margarine spreads, by household Income, May 2006-June 2007
- Figure 90: Usage of butter, margarine, and margarine spreads, by number of people in household, May 2006-June 2007
- Figure 91: Usage of butter, margarine, and margarine spreads, by number of people in household, May 2006-June 2007
Use of margarine by type of oil used in production
- Figure 92: Types of margarine used, by type, May 2006-June 2007
Usage of butter, margarine, and spreads by type
- Figure 93: Usage of butter, margarine, and spreads, by age, March 2008
- Figure 94: Usage of butter, margarine, and spreads, by race/ethnicity, March 2008
- Figure 95: Usage of butter, margarine, and spreads, by household income, March 2008
Preferences for baking
- Figure 96: Usage of butter, margarine, and spreads for baking, by gender, March 2008
- Figure 97: Usage of butter, margarine, and spreads for baking, by age, March 2008
- Figure 98: Usage of butter, margarine, and spreads for baking, by race/ethnicity, March 2008
- Figure 99: Usage of butter, margarine, and spreads for baking, by household income, March 2008
- Figure 100: Usage of butter, margarine, and spreads for baking, by presence of children in household, March 2008
Preferences for stove top cooking
- Figure 101: Usage of butter, margarine, and spreads for stove top cooking, by gender, March 2008
- Figure 102: Usage of butter, margarine, and spreads for stove-top cooking, by age, March 2008
- Figure 103: Usage of butter, margarine, and spreads for stove top cooking, by race/ethnicity, March 2008
Preferences for everyday use
- Figure 104: Everyday usage of butter, margarine and spreads, by gender, March 2008
- Figure 105: Everyday usage of butter, margarine and spreads, by age, March 2008
- Figure 106: Everyday usage of butter, margarine and spreads, by race/ethnicity, March 2008
- Figure 107: Everyday usage of butter, margarine and spreads, by household income, March 2008
Butter brands usage
- Figure 108: Use of butter brands, by number of people in housedhold, May 2006-June 2007
- Figure 109: Use of butter brands, by number of children in household, May 2006-June 2007
Beliefs and behaviors related to butter use
- Figure 110: Beliefs and behavior related to butter use, by age, March 2008
- Figure 111: Beliefs and behavior related to butter use, by race/ethnicity March 2008
- Figure 112: Beliefs and behavior related to butter use, by household income, March 2008
- Figure 113: Beliefs and behavior related to butter use, by region of residence, March 2008
- Figure 114: Beliefs and behavior related to butter use, by presence of children in household, March 2008
Beliefs and behaviors related to margarine use
- Figure 115: Beliefs and behavior related to margarine use, by age, March 2008
- Figure 116: Beliefs and behavior related to margarine use, by household income, March 2008
- Figure 117: Beliefs and behavior related to margarine use, by region of residence, March 2008
- Figure 118: Beliefs and behavior related to margarine use, by presence of children in household, March 2008
Behavioral changes with regard to butter use
- Figure 119: Behavioral changes with regard to butter use, by gender, March 2008
- Attitudes toward meal preparation
- Figure 120: Attitudes toward meal preparation, by age, March 2008
- Figure 121: Attitudes toward meal preparation, by race/ethnicity, March 2008
- Figure 122: Attitudes toward meal preparation, by household income, March 2008
- Figure 123: Attitudes toward meal preparation, by household income, March 2008
Appendix: Trade Associations

Butter, Margarine and Table Spreads - US - May 2008

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