New budget butter pricing 'a little cheeky'

The Valumetric butter on special in Countdown on Thursday morning.
The Valumetric butter on special in Countdown on Thursday morning. Photo credit: Newshub.

Fonterra is being accused of tricking shoppers into paying more for butter.

Valumetric 400g butter blocks recently went on sale at Countdown for $5.50 - that's $1.38 per 100g.

Comparatively, a 500g block of Anchor butter (Also Fonterra-owned) costs $6.20, or $1.24 per 100g; and a block of 500g Signature Range butter is $5.90, or $1.18 per 100g.

New budget butter pricing 'a little cheeky'
Photo credit: Countdown

There has been a 62 percent increase in the price of butter in the last 12 months. As of November the cheapest block of butter available was $5.74 a block - a year ago it was $3.50.

Auckland University senior marketing lecturer Mike Lee describes the move as "a little cheeky", particularly because it's easier for consumers to notice a difference in price than size.

"The size is obviously designed to target low-involvement consumers just making decisions based on price rather than perceptible product size differences."

He says consumers have been caught out in the past.

"Chocolates, confectionary and biscuits are the common culprits. Coke has also recently moved to a price rather than volume model as well, but for them it may be more about the current negative stigma associated with high volumes of sugar consumption.

"Arguably the confectionary companies could argue the same things, but one gets more cynical when the price per gram goes up."

His advice for consumers: be vigilant.

Fonterra says it introduced the Valumetric butter range to compete with other 400g options already available.

"There is no 500gm Valumetric butter and the 400gm Valumetric is clearly labelled and comes in smaller packaging," a spokesperson told Newshub.

Fonterra says consumers should be well-informed because both Foodstuffs and Progressive Enterprise supermarkets display the price per 100g to make comparison easier.