BREAD SPREAD

COELI CARR

These days, there's plenty of butters, margarines and spreads to go around, dairy managers are observing. The popularity of crusty, artisan breads, the public's disenchantment with low-fat dietary regimes, and shoppers' desire to indulge themselves may all be contributing factors to retailers' awareness that "butter is back."

What's more, the category spans a wide price and quality range, with something for every taste and preference, they said.

Dannie Ray Sullins, manager of the dairy and cheese departments at the recently opened Fox & Obel Food Market, Chicago, sees the new interest in butter as a natural progression from consumers' fascination with another dairy item.

"There's a parallel between people buying exotic cheese, which has millions of flavor nuances," Sullins, who is also a cheesemaker, told SN. "Now people are recognizing these nuances in butter. Customers are asking for 'cultured' butter and for specific brands they are loyal to."

But in some supermarkets, shoppers have not veered away from traditional product. At the relatively upscale Pine Creek, Del., store of Acme Market, Malvern, Pa., dairy associate Bob Auger says that he sells three times as much margarine as butter, though all spreads do well. Estimating his 16 feet of butter-and-spreads shelf space holds about 10 different brands of margarine -- including the retailer's own -- in various low-fat and light formats, Augur stated there's usually at least one margarine on sale in any given week. Of the butters, the salted Acme brand outsells the two commercial brands 2 to 1, with sales of sweet butter picking up during the holiday baking season.

While Augur says that most of his customers have favored margarine for "health reasons," simple economics is also a factor. "The price of butter has skyrocketed in the past couple of years," he said, adding there's noticeable shopper movement when either commercial or store-brand butter goes on sale. The chain -- a division of Boise, Idaho-based Albertson's -- advertises in circulars, and specials take the form of either a price reduction or a buy-one-get-one-free offer.

For Fox & Obel's Sullins, on the other hand, the sale of margarine and spreads was "somewhat of a failure." Now, only about 25% of 15 feet of shelf space is relegated to those items.

"Customers found the non-butter items not to be what they were looking for in terms of flavor," he said, adding that shoppers perceive these items have limited application -- mainly on toast in the morning -- and lack versatility. "To a certain extent, all these funky spreads have left people with a sense of deprivation."

He added that various reports seem to vacillate on the health benefits of these products.

"The more well-traveled and educated our consumers are, the more they choose butter in moderation," Sullins said, noting that the "Food Network has done miracles for specialty stores" with respect to butter.

Because of limited space, Sullins rotates his butter product, which he prefers to limit to eight brands. Offering too many choices is counterproductive because it confuses and intimidates customers, he said.

Despite the fact specialty butters cost about twice as much as commercial brands, price has not been a big deterrent, according to Sullins.

"Sales of imported, specialty butters have skyrocketed," Sullins said. So much so -- by at least 20% in the last couple of years, he estimates -- that cheese producers "have started to get in on the show" by now offering butters.

"We can't keep Vermont Cultured Butter [from Vermont Butter & Cheese Co.] in the store," he said, referring to this European-style product's 86% butterfat content vs. 80% for most commercial butters, and 83% for many specialty butters. Cultured butter is "hugely in demand," he said, noting people are willing to pay for flavor, especially if a retailer educates and hand-sells butter to the customer. It's not surprising, then, that he provides shoppers with literature from vendors and endorses active and passive sampling.

"Active sampling promotes betters sales," he said, adding that his staff walks around the store with tasting trays. Even the store's cafe gets into the act: The cafe sells half a baguette and offers samples of four different kinds of specialty butter for $3.50. "The staff is educated and, if a customer has other questions, we'll send over the dairy guy," Sullins said.

At Foods of All Nations, Lynn Hampton, a director at the chain's Virginia Beach store, said he stocks more than a dozen kinds of European butters -- English, Swedish, Danish and Italian among them. For more exotic tastes, he sells Greek sheep's butter, as well as truffle butter priced at $13.99 for two ounces. The store's customers are largely well-traveled due to their affiliation with the area's military bases, and Hampton allots about 16 feet to butter and spreads.

"In our market, butters do well," he said. Because of the built-in "familiarity" factor prompting his European customers to buy their native countries' own butter product, Hampton said he has no need to advertise or offer specials. He is, however, always open to adding to his already-substantial variety.

"If a lot of customers request a product, we'll get it," he said.

In contrast, Wild Oats Markets, Boulder, Colo., has successfully developed the category by narrowing the focus on organic butter, according to Rick Werner, the chain's category manager, dairy and frozen. Depending on the size of the store, organic butter product occupies from 3 to 5 feet of shelf space.

"There's terrific movement when we have specials on organic brands," Werner said. "No question that promoting the organic creates velocity."

Even though Werner sells imports -- the brands vary from store to store, and imports do well in Boulder, he said -- "a high percentage of the sales are in organic."

Because of the preferences of his consumer base, Werner finds himself in the enviable position of letting the product sell itself, without much need for sampling.

"Most of our customers are well aware of the quality and taste of organic," he explained. "They know they're going to pay a premium relative to commercial butter, but they have a clear idea of the value equation."

Werner terms his price reductions on organic butter as "very aggressive," especially during the winter holidays.

"Like conventional stores, we have a baking season and the butter goes," he said, noting November and December as key months for increased revenues.

"You want people to buy that butter in your store," Werner continued. "You want to be seen as a partner, so you put items on sale when customers need them."

Although the Wild Oats stores do not sell commercial butter -- they also sell no margarine because it contains hydrogenated oils -- the company does produce a store brand called "Wild Oats Down to Earth Value."

"Our store-brand butter is nonorganic, but clean," Werner said, noting that this butter is priced 65% lower than organic brands "to give customers a price point comparable to the conventional brands in a supermarket."

Werner anticipates he'll promote European butters to a greater degree down the line and offer a more consistent selection, when "corporate centralizes the purchases."

Meanwhile, retailers have enough on hand to tempt interested customers, whom Werner terms "foodies who love new and exciting things, the kind of people you can please with demo, since they taste and feel it in their mouth."