Keurig was the first company to make coffee pods trendy in North America. But if you do any looking around online today, the brand that you'll see most often is Nespresso. Because despite Keurig's massive head start, when their patent expired in 2012, Nespresso stole their lunch. But this dominance was not just luck, and the way that they did it might surprise you. So it is time to spill the tea on the Nespresso coffee pod craze.
Today's video is sponsored by Masterworks. Now, while it might seem like Keurig had the head start in North America, Nespresso was actually the original gangster in the story all the way across the water in Europe. In 1975, an engineer named Eric Favre had the idea for a machine that allowed people to make sophisticated espresso at home instead of going to an espresso bar. He created a patented technology that used insanely high pressure to make that little a nice foam topping that people love and associate with high-end espresso. From there, Nespresso was born.
Just like Keurig, Nespresso machines popped up in offices before they were ever marketed for home use. But their sales weren't looking particularly great, and the company had huge overhead at the time, so they had to find a new business model to make any money at all. Enter these guys.
In 1990, Jean-Paul Gallard took over as CEO and turned Nespresso into a luxury at-home Nespresso brand. He did this by creating an exclusive club around their product, lowering the price of the machines, and then jacking up the price of their single-use capsules. Sound familiar? Unlike Keurig, though, whose marketing tactic was all about convenience, Gallard wanted to sell Nespresso products to high-end consumers.
Or as he put it in an interview once, people... who have a doorman, which is such a vivid way of describing somebody as wealthy. It did not take long for Nespresso machines to show up in upper-class homes all throughout Europe.
George Clooney was even paid a ridiculous amount of money to do European Nespresso ads, and that worked, apparently. But as you well know, the Nespresso of today isn't just limited to the wealthy Europeans and their marble palaces, and today there's examples of this all over the world, even in the world of art. The whole Future Proof team is very excited to announce that this video is sponsored by Masterworks. Masterworks is a platform for investing in contemporary art for just a fraction of what the billionaire investors pay to purchase it outright.
While investing in art was reserved for the wealthy elite, today, anyone can invest in a bank seat. Based on research and art trends and appreciation value projections, Masterworks purchases art and makes it investable to their members only. The art is then held over time until Masterworks finds the best time to sell and once sold, the returns are distributed back to the investors. With all of the world's volatility right now, it's nice to be able to diversify your portfolio and fine art traditionally does pretty well in the marketplace because it's kind of outside of the marketplace.
Masterworks is giving everyday people just like you and me a chance to get in on the art investment world. And the best part is if you sign up, it only takes like 60 seconds and you'd be supporting this channel. Because brands like this help us make content free for you. So if you want to support the channel and support them, click the link down in the description to check it out.
Now, Nespresso has penetrated the gated communities of Europe, but there was one massive market that Nespresso had a hard time cracking. North America. In the land where coffee means XXXL with double cream and double sugar drank out of a styrofoam cup the size of your head, fancy espresso just wasn't what American consumers wanted. So in 2014, Nespresso released new machines that were capable of making much larger cups of coffee. that had a European flair.
This basically married North America's need for instant gratification with a bit of that little foamy fancy stuff to make you feel extra special. But of course, it wasn't just enough to bring a better Keurig to the market. They needed something special.
No, some one special. Yes, they brought George Clooney back for a victory lap to make North American Nespresso ads and that pretty much sealed their fae-apparently. Could you imagine How successful this channel was, if it was just George Clooney hosting instead of this dumb idiot, frig, we'd be at a million subscribers right now. I am disappointed in myself, honestly.
Please hit the subscribe button to make me feel better. However, it wasn't just the elevated Clooney coffee experience that Nespresso offered. By the time Nespresso had entered the coffee pod scene, the environmental impact of these things was pretty well established and probably one of the largest consumer complaints about the product. They're basically the younger sibling who watched Keurig, the older sibling, go out and do everything wrong, and then they got to come in afterwards and just reap all the benefits.
They understood from the beginning that if Nespresso was going to conquer this new market, they needed to make coffee pods better tasting and better for the planet. And they did this by making some huge sustainability promises. Now, if you check out the sustainability page on Nespresso's website, they... kind of come off as these like superhero planet savers. They promise to protect the rainforest, to work with small independent coffee farmers around the world, and their biggest swing, to ditch disposable coffee pods and replace them with recyclable aluminum coffee capsules.
Nespresso made the bold promise to recycle your coffee pods for you if you drop them off at a Nespresso boutique or mail them back to them in a bag that they can and send to you for free from their website if you order it. This innovative solution tackled the problem at the core and in the course of merely weeks, completely solved the problem of coffee pod waste. Thank you so much for watching this week's video. If you liked it, please remember to subscribe because, no, we're not done.
That was like a fake ending to the video. We got a lot more to get into here. Just because consumers can recycle something, does not mean that they do.
But the awareness that they could recycle something makes people a lot more willing to buy them and Nespresso knows this. Nespresso has no measurable way to track what percentage of their pods actually get recycled conveniently. Experts have speculated that at most only 5% of the 14 billion pods that Nespresso sells every year actually get recycled, which means a whole heck and hunk of them are sitting in landfills.
which was what they invented the aluminum things to specifically not do. So that's sucky. Nespresso owners have also complained that the pods can get moldy and grow sitting in the recycling bag for months before it's full enough to actually send off for recycling, which means more of them get trashed. Those really dedicated Nespresso users advised to fully dry your pods out before storing them in the freezer to avoid growing spores and stinking up your kitchen, which seems really super convenient and easy to get on board with.
But regardless of this program's actual impact on the plant, but regardless of this program's actual impact on the environment, it has had a massive impact on their revenue. Nespresso has dominated the coffee industry, partly on the idea that they were not only better, but more sustainable than the competition. But where would they get such a cunning, brilliant idea from?
Well, As they used to say back in the late 2000s, Yeah, that was a weird song that we all sang to for a while. 2000s were a weird time to be alive. Yes, Nespresso's mama company is the infamous and ever controversial Nestle. If you don't know about how horrible this company is, we quite literally don't have time to get into all of it in this video.
for a number of reasons. From bottling water in droughts to child labor violations, they're top tier f*** face capitalism in a nutshell. But even with all these controversies, Nestle is doing just fine because they own everything. pretty much everything.
They own most of it and it's depressing as hell. Now how did Nestle influence Nespresso in this takeover? Well other than providing them all the money and technology in the world and free license to do morally anything they want to win, Nestle is also a marketing genius. They are one of the world's largest polluters and they earned that title by shoving off the responsibility onto their consumers by promoting recycling.
They made consumers feel less terrible about using single-use plastics because they understood that if people thought that their recycling efforts offset the waste that they would be creating, they would keep buying it. So does this sound a little familiar now? As long as those Nespresso coffee pods are recyclable and they've made the public claim to be a sustainable company, then you as the consumer can feel good about buying it.
Nespresso doesn't need to track how many of their pods actually get recycled because their job is just to offer the program it's your job to make sure that the pods get recycled their nestle style recycling push has been so convincing in fact that in july of 2021 nespresso was named the most sustainable coffee company by the world finance magazine now this would be more convincing if you just ignored the irony of a Finance Magazine giving out sustainability awards and the fact that only publicly traded massive corporations were considered for the award and that this news was provided by Nestle Nespresso themselves. But anyway, despite the fact that their recycling program is a failure, Nespresso still looks like a more planet-friendly option than Keurig, who literally just launched recyclable plastic K-Cups in 2016 and weren't even fully rolled out until 2020. God, guys, come on. Pair that with the sexy George Clooney coffee experience and it's really easy to see why everybody is rushing to buy Nespresso coffee pods because they wanna feel like George Clooney likes them.
That's understandable. So it's been eight minutes of Levi telling you how terrible the corporate world is. The apathy is washing over you.
And the last thing that you want to do is like this video, obviously. But you should, please. Because you know what? There's always hope.
There is always hope that you will like this video. Because liking the video helps us. It helps the videos get more views.
And more views means more subscribers. And more subscribers mean more views. And the growth of this channel overall.
Anyway, I digress. At the end of the day, whether it is Nespresso or Keurig, single-use coffee pods are a bane to the planet's existence overall. And both brands know this, which is why they've been scrambling to create solutions to appear to fix the problem.
And they aren't the only ones doing so. Other companies have offered new products like reusable and compostable coffee pods to work with Nespresso and Keurig machines to solve this issue. So let's talk about... Compostable coffee pots.
Fun fact, the first fully biodegradable coffee pods for Nespresso machines was created by, yes, the Ethical Coffee Company, which was founded by none other than Jean Paul Gallard. Remember that guy? We talked about him earlier. He's the one who wanted to turn Nespresso into like an upscale coffee brand for people who had a Dorman.
Gallard. Gallard. F***. Gallard left Nespresso and had a huge falling out with Nestle, which couldn't be hard to do, so in 2010 he launched his own company to be in direct competition with Nestle, and that's just good old-fashioned capitalism for you.
Gallard's pods might be biodegradable, but they aren't a perfect solution by any means. There is this idea that as long as something is compostable or biodegradable that it's perfectly sustainable thing, and that is just not true. Compostable coffee pods are tricky because they're not easy to manufacture, first of all, which means they're usually more expensive.
They have to be able to withstand really high heat to actually make coffee, which isn't easy with natural materials like bamboo and paper. Natural materials also don't keep coffee as fresh as plastic or aluminum pods do, so there's also issues with their shelf life. Then there's the issue of actually disposing of it.
City composting is not something that most people have access to in North America. A lot of waste management companies also don't accept the coffee pods in their compost collection because they're too easy to confuse with the plastic pods and they end up getting tossed into the regular trash instead. This issue definitely varies based on where you live, but the bottom line is that unless you have an at-home compost system, it's hard to know if your coffee pods are actually getting composted. So I know you're yelling already, the hero here is the reusable coffee pod, right? You can fill the pod with your own coffee.
And then when you're done with it, you simply wash it, you know, use it over again. Biddy-bid-bam, biddy-diddy-boom is the thing I just said. It's cheaper than buying single-use pods. You can compost the grounds yourself, and you're avoiding all that package waste in the process.
Congratulations. However, there is one major downside, and it is that they kind of suck at making coffee. You have to find the right type of...
pod to fit your machine and then you've got to get your grind exactly right to fill the pod with an extremely exact amount of coffee grounds and water and if your measurements are just even slightly off you kind of end up with a terrible cup of coffee now at this point i hate to say it you're gonna hate it when i say it and i'm so sorry but maybe you should just make coffee the old-fashioned You know, I was expecting you to have some sort of retort there. Sorry, that was that was an extended pause. And we don't really do that on this channel very often.
So if you're a human who drinks coffee, hopefully this video is of interest to you. And if it was, subscribe. We'll see you in the next one.
Thank you so much. Bye bye.