The Coffee Pod Revolution

Posted on: 2015-04-14 12:00 AM

Kevin Sullivan, chief technology officer at Keurig Green Mountain, maker of coffee machines, got his start in aerospace and defense — working for GE in the satellite division, putting satellites onto rockets and putting them in orbit.

So, does it take a rocket scientist to make a good cup of coffee? “It helps!” he laughed.
The idea of making coffee a cup at a time started catching on about a decade ago. It turned out to be a high-tech challenge. “It’s very complicated,” he said, because it CAN’T be complicated for the guy trying to wake up in the morning.

Sullivan demonstrated: “You just close the handle and touch a button, and away it goes.”
A cup of coffee in less than a minute. Speed, convenience and the appeal of exotic flavors (Pumpkin Spice, Mountain Blueberry, Golden French Toast) have put single serve machines in one out of every three American homes.

And what happened to the percolator? And drip coffee machines? “I think they’re all in the basement,” he said. “Single serve, I think, found the hidden need, the need that people didn’t know they had.”
Filling that need has turned Keurig — whose machines can cost a couple of hundred bucks — into a $4.7 billion business.

“A cup of coffee made this way is not necessarily cheap,” said Spencer.
“It’s less expensive than if you go to a coffee shop, but it’s more expensive than if you bought a pound of coffee and did your drip grind,” said Sullivan.
Last year Americans doled out more than $3 billion on single-serve capsules.
But there is a brewing environmental controversy: What to do with the millions of pods when the coffee’s gone?

Spencer asked, “So where is Keurig now in terms of making these things recyclable?”
“We’ve been hard at work to solve that problem,” said Sullivan. “We introduced a system called Vue that has cups that are, in fact, recyclable. We have a company objective that everything will be recyclable by the year 2020. We certainly aren’t going to wait that long. I think we’re going to start that much sooner, and hopefully convert sooner than that.”

Customers apparently aren’t much deterred by either environmental concerns or price. These days, A cup of hot coffee is cooler than ever.