
In the league table of odd advertising combinations, Johnny Rotten and Country Life butter must feature close to the top. Nonetheless, the punk hero was hired to promote the taste of the butter and has helped boost its sales in the process.
The yellow fats sector has always been a major investor in marketing and advertising, as manufacturers seek to boost their brands, promote new products and support the market.
This sector has come on in leaps and bounds over the years, as NPD has resulted in genuine innovation. The days of bread being shredded by rock-hard butter were consigned to the past with the arrival of spreadable variants, and the flavours of spreads and margarines have been refined so that the synthetic taste of earlier products no longer remains.
In addition, developments in formulations mean many products come with added benefits to aid a healthy diet, or have a reduced fat content.
This has been particularly important in continuing to attract health-conscious consumers aiming to reduce their fat intake.
Nonetheless, heavy use of yellow fats is in decline, according to TGI.More than one in three people has cut back on butter for health reasons, and nearly one in five on spreads.
Since 2004, value sales have risen by 40%, driven by innovation and price inflation. However, volumes have stalled, while rising costs have affected all dairy products. The market grew 16% in 2008 to reach a value of £1.1bn, according to Mintel.
Butter sales have been boosted by the trend of cooking from scratch, as well as consumer desire for natural ingredients and transparent provenance. Butter sales increased by 19% between 2007 and 2008 to reach a value of £525m. Butter has outperformed spreads over the past five years, as eating habits have changed.
However, only two in five consumers consider butter to be a 'natural' food. Perhaps as spreadable varieties become more popular, the product has lost some of its natural positioning. Spreadable butter, which surpassed blocks for the first time in 2006, accounts for 54% of butter sales.
In contrast, the market share of active health spreads has fallen off. These spreads, such as Benecol and Flora Pro.Activ, came onto the market claiming to lower cholesterol. They carry a price premium, but their health benefits are not always under-stood, causing sceptical consumers to stay away.
Yellow fats are dominated by brand names, with own-label accounting for only 16% of the market. Three manufacturers - Arla, Unilever and Dairy Crest - account for almost 75% of sales. The major players focus on extensive marketing activity and advertising to promote their brands and the sector as a whole.
Most recently, Dairy Crest backed its relaunched Clover brand with a major drive carrying the strapline
'The middle is the best of both', which refers to the fact that the product is churned like butter yet contains half its levels of saturated fat.
Arla is the leading yellow fats manufacturer and shows what can be achieved with well-supported butter brands. Lurpak's brand share has increased; its sales have risen almost 40% since 2006. Anchor, Arla's other butter brand, has also performed well and increased sales by 18% between 2006 and 2008.
Unilever's spreads portfolio includes I Can't Believe it's Not Butter, Bertolli and Flora. However, butter's resurgence has had an impact on the company and Flora's brand share has fallen, despite a modest sales increase in the past few years.
The yellow fats sector is a mature market, and significant growth will therefore be hard to achieve. However, it is expected to grow by 17% over the next five years, or 6% when inflation is taken into account, according to Mintel. By 2014, sales will have reached £1.4bn. Of these, butter sales will be worth £682m, a 20% increase over the period.
Yellow Fat Brands by Value and Share | |||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Brand | 2008 | 2007 | 2006 | % change | |||||||||||||||||||||||||||||||||||||||||||||
£m | % | £m | % | £m | % | ||||||||||||||||||||||||||||||||||||||||||||
Arla Foods | 320 | 29 | 271 | 29 | 241 | 27 | 32.8 | ||||||||||||||||||||||||||||||||||||||||||
Lurpak | 230 | 21 | 191 | 20 | 165 | 18 | 39.4 | ||||||||||||||||||||||||||||||||||||||||||
Anchor | 89 | 8 | 79 | 8 | 75 | 8 | 18.7 | ||||||||||||||||||||||||||||||||||||||||||
Yorkshire Butter | 1 | 1 | 1 | 0 | |||||||||||||||||||||||||||||||||||||||||||||
Unilever | 287 | 26 | 272 | 29 | 263 | 29 | 9.1 | ||||||||||||||||||||||||||||||||||||||||||
Flora | 190 | 17 | 177 | 19 | 176 | 20 | 8 | ||||||||||||||||||||||||||||||||||||||||||
I Can't Believe It's Not Butter | 28 | 3 | 33 | 3 | 30 | 3 | -6.7 | ||||||||||||||||||||||||||||||||||||||||||
Bertolli | 45 | 4 | 41 | 4 | 38 | 4 | 18.4 | ||||||||||||||||||||||||||||||||||||||||||
Stork SB | 24 | 2 | 21 | 2 | 19 | 2 | 26.3 | ||||||||||||||||||||||||||||||||||||||||||
Dairy Crest | 224 | 20 | 175 | 18 | 180 | 20 | 24.4 | ||||||||||||||||||||||||||||||||||||||||||
Clover | 78 | 7 | 59 | 6 | 68 | 8 | 14.7 | ||||||||||||||||||||||||||||||||||||||||||
Utterly Butterly | 70 | 6 | 58 | 6 | 45 | 5 | 55.6 | ||||||||||||||||||||||||||||||||||||||||||
Country Life | 59 | 5 | 40 | 4 | 42 | 5 | 40.5 | ||||||||||||||||||||||||||||||||||||||||||
St Ivel Gold | 6 | 1 | 12 | 1 | n/a | ||||||||||||||||||||||||||||||||||||||||||||
Vitalite | 8 | 1 | 6 | 1 | 6 | 1 | 33.3 | ||||||||||||||||||||||||||||||||||||||||||
Willow | 9 | 1 | 6 | 1 | 7 | 1 | 28.6 | ||||||||||||||||||||||||||||||||||||||||||
Kerrygold Kerrygold | 29 | 3 | 25 | 3 | 20 | 2 | 45 | ||||||||||||||||||||||||||||||||||||||||||
McNeil Nutritionals Benecol | 18 | 2 | 18 | 2 | 18 | 2 | 0 | ||||||||||||||||||||||||||||||||||||||||||
Kerry Foods | 8 | 1 | 8 | 1 | 6 | 1 | 33.3 | ||||||||||||||||||||||||||||||||||||||||||
Pure dairy-free spreads | 6 | 1 | 6 | 1 | 5 | 1 | 20 | ||||||||||||||||||||||||||||||||||||||||||
Kerrymaid | 2 | 2 | 1 | 100 | |||||||||||||||||||||||||||||||||||||||||||||
Lactalis McLelland President | 8 | 1 | 6 | 1 | 5 | 1 | 60 | ||||||||||||||||||||||||||||||||||||||||||
Other brands | 33 | 3 | 33 | 3 | 29 | 3 | 13.8 | ||||||||||||||||||||||||||||||||||||||||||
Own-label | 174 | 16 | 140 | 15 | 130 | 15 | 33.8 | ||||||||||||||||||||||||||||||||||||||||||
Total | 1101 | 100 | 948 | 100 | 892 | 100 | 23.4 | ||||||||||||||||||||||||||||||||||||||||||
Source: Mintel |
Yellow Fat Retail Sales by Outlet Type | |||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Outlet Type | 2008 | 2007 | 2006 | % change | |||||||||||||||||||||||||||||||||||||||||||||
£m | % | £m | % | £m | % | ||||||||||||||||||||||||||||||||||||||||||||
Multiple grocers/co-ops | 1035 | 94 | 886 | 93 | 830 | 93 | 24.7 | ||||||||||||||||||||||||||||||||||||||||||
Independents & symbol grps | 35 | 3 | 36 | 4 | 38 | 4 | -7.9 | ||||||||||||||||||||||||||||||||||||||||||
Other | 31 | 3 | 29 | 3 | 24 | 3 | 29.2 | ||||||||||||||||||||||||||||||||||||||||||
Total | 1101 | 100 | 951 | 100 | 892 | 100 | 23.4 | ||||||||||||||||||||||||||||||||||||||||||
Source: Mintel |