Posted on Sunday, December 28, 2008 by Michael
I found Corey Bergman’s recent blog post interesting. In part…
I’m reading a book (that has yet to be released) called “Wired to Care” by Dev Patnaik…
Back in the late 1950s and early 60s, Maxwell House began slowly substituting tasty but expensive “Arabica” beans with bitter but inexpensive “Robusta” beans in its coffee, Patnaik writes. After all, customers were complaining about the increasingly high prices. Maxwell House made the transition slowly, conducting consumer research along the way, and the vast majority of its coffee drinkers were unable to detect the difference. This kept prices under control, customers happy, and the business continued to run at a respectable profit. Other coffee makers did the same.
By 1964, coffee sales declined for the first time in the history of the U.S. Younger people weren’t becoming coffee drinkers. Why? To a first-time coffee drinker, it tasted horrible. Coke and Pepsi sales began to skyrocket. Coffee continued its decline. Then a man named Howard Schultz took note of the espresso bars in Italy and launched a little company called “Starbucks,” bringing back Arabica beans with a new way of doing business. Young people began to drink coffee again. The industry had been reinvented.
Bergman goes on to say something similar is underway with local TV news.