Uncommon Grounds: The History of Coffee and How It Transformed Our World

by Mark Pendergrast

  Hills Brothers had emerged as the leading regional coffee. The two aging Hills brothers, A.H. and R.W., still monitored the business but their children had taken over the day-to-day decisions. Prior to World War I, Hills Brothers Red Can vacuum-packed coffee was sold throughout the seven western states, in part of Montana, and in Alaska. In 1920 it moved into New Mexico, Colorado, Wyoming, and the rest of Montana. Throughout the rest of the twenties, the company steadily marched east, systematically saturating every new area with newspaper ads while salesmen set up window displays in local retail outlets.

  The original Jim Folger’s son James A. Folger II continued to lead the oldest San Francisco coffee firm. On July 5, 1921, Folger, like his father, died prematurely of a heart attack at fifty-seven. Ernest R. Folger, his younger brother, now assumed the presidency of both Folger companies (in Kansas City and San Francisco). When James A. Folger III graduated from Yale in 1922 with a degree in physics and economics, he joined the family business in the new advertising department. In Kansas City, Frank Atha’s sons, Russell and Joseph, also joined the firm.

  Under the new management, Folger’s newspaper ads boasted, “We Go 10,000 Miles for Coffee,” the distance the beans traveled from plantation to roaster. The ads also played up the insecurity of housewives, for whom a good after-dinner coffee meant social status. Folger’s billboards offered “A Word to the Wives . . . Folger’s Coffee,” while a sexist 1922 ad explained, “It’s a Vital Matter, Madam—to the Men.” If the coffee lacked flavor, “It’s a brand’s fault, not yours.”

  MJB, under the leadership of Max Brandenstein after Mannie died, targeted the lower price range. “Which Coffee is the MOST ECONOMICAL? In a Coffee with the flavor and great strength of M.J.B. you use half as much as of inferior grades.” Such a claim was preposterous, leading only to a watered-down brew—but it did sell coffee.

  Hills Brothers hired N. W. Ayer to design their advertising campaigns. In 1921 they placed Red Can spots in every streetcar west of the Rocky Mountains. “Rich flavored and full bodied: Selected from the finest plantations and vacuum packed.” That September, Eddie Hills, R.W.’s son, wrote to his uncle that “we have been going very strong this month. [For two weeks] we were obliged to run the factory until ten o’clock at night. . . . Things have been running very smoothly with no complications.”46

  Yet things soon did become complicated. To boost sales, the spreading chain grocery stores sometimes sold brand-name coffee below their own cost. The small grocer could not compete. Led by Hills Brothers, several coffee firms instituted a “minimum resale price” to protect the traditional retailers. Beginning in fall 1920, Hills Brothers refused to sell to any firm that did not resell their coffee for at least a nickel more than the wholesale price, which allowed approximately an 11 percent markup—usually just enough to cover overhead and give a small profit to the grocer. The rapidly growing Piggly Wiggly chain balked, vaunting the fact that it sold only at cut-rate prices. “No Hills Coffee,” its headline advertising read. “Shall the Consumer Be the Goat? No! Never! A thousand times No!” The ad explained that Hills Brothers insisted that the chain raise prices 1 cent per pound.

  For its stand Hills Brothers became an instant hero to smaller retailers. A California trade journal, the Retail Grocers Advocate, urged readers to “boost Hills Bros. Coffee at every opportunity—morning, noon and night.” The editor praised Hills Brothers for standing up to Piggly Wiggly. He blasted MJB, Folger’s, and Schilling as “outlaw roasters” for selling to the chains and not enforcing a minimum retail price. A Hills Brothers executive declared it “a war, not a battle” and vowed a fight to the finish.

  Despite the minimum resale price, the chains’ triumph appeared inevitable. Ironically, it was hastened by the Federal Trade Commission, which had been created in 1914 for the purpose of ensuring fair competition. In 1925 the FTC sued Hills Brothers for price fixing and constraint of trade. In vain the Hills Brothers briefs pointed out that their minimum resale policy effectively promoted competition by protecting the small corner grocery against predatory price cutting. The FTC ruled against the minimum resale price plan.

  The legal setback did not stop Hills Brothers’ aggressive drive toward the east. By 1925 the firm sold nearly half its coffee outside of California, and that percentage would increase substantially in the next few years. Their ad copy played up their rugged Western origins. “The robust West loves its vigorous drink,” copy read, while an illustration showed a bronco rider. Another ad portrayed a mountain scene with “Gorgeous heights and deep ravines . . . and Hills Bros. Red Can Coffee.” Out in this territory “a canyon is a canyon—dizzy-deep and awesome. And coffee is coffee!”

  By 1926 Hills Brothers was spending a quarter of a million dollars on advertising, mostly in California, Oregon, Missouri, and Utah newspapers. In 1927 the firm opened a sales division in Minneapolis, quickly establishing itself as the leading brand in the Twin Cities area. In December of that year N. W. Ayer conducted an industry survey of over two hundred towns in the Midwest. The emerging portrait showed an industry in transition, ripe for a major advertising campaign. Nationally advertised brands, such as Chase & Sanborn and Maxwell House, frequently appeared, but rarely as the leading brand; usually a local brand predominated. In fifty-five stores in Aurora, Illinois, for instance, the survey found eighty different brands. In addition, unbranded bulk coffee still outsold the brands in a sizable minority of the stores. Grocers in the rural areas reported that the Jewel Tea peddlers had grabbed as much as 20 percent of the entire coffee business.

  In 1928 Hills Brothers opened a Chicago office. For two years they systematically canvassed areas around the Midwestern city in preparation for the big push in Chicago itself. Hills Brothers began a “sampling campaign,” giving away half-pound cans to everyone in a targeted small town, while installing store displays and placing full-page newspaper ads in the local papers. The results often were spectacular. In Milwaukee, when the campaign began in October 1928, Hills Brothers was virtually unknown; two months later it was the best-selling public brand of coffee in the city, though A & P’s private Eight O’Clock brand still held the lead.

  No longer content with batch-roasted coffee, Hills Brothers’ engineers created a long roaster through which beans continuously passed on a conveyer belt. This assembly-line approach ensured a uniform roast but destroyed the art of the individual roast master, who fine-tuned each batch to the needs of the particular beans. Hills Brothers nonetheless made their new “controlled roast” the focus of their 1929 advertising, touting it with clever cooking analogies: “To thoroughly bake a hundred-pound fish would be a whale of a job,” a headline read, along with an eye-catching illustration of a housewife attempting to do just that. Similarly, the ad explained, coffee had to be roasted just a bit at a time, in a continuous process. For those who didn’t know much about roasting coffee, the ads were effective. More important, they were relentless and ubiquitous.

  At the end of the decade, Hills Brothers was an exceedingly well-managed company. Although still family-owned, the firm was run by second-generation professional managers with near-military precision. Indeed, war analogies surfaced frequently in sales bulletins. “The guns are loaded, men—firing has commenced—the ammunition piles are huge and handy—there will be no let-up in the battle from now on, until the Hills Bros. flag flies from the topmost height.” At company conventions employees sang their allegiance to the revered old brothers, A. H. and R. W. Hills: “Hail to you our honored Chieftains! / Staunch, untiring, loyal Captains! / Success was won by constant effort, / ‘Red Can’ goes marching on.”

  The Decline of Arbuckles’

  As executive M. E. Goetzinger wrote in a brief history of the firm in 1921, Arbuckle was “the world’s greatest coffee business.” Its Jay Street Terminal in Brooklyn was equipped with its own freight station, locomotives, tug-boats, steam lighters, car floats, and barges. It owned motor trucks and horses, a gigantic printing press for coffee wrappers and circulars, an
d a barrel factory, in addition to massive roasters and a sugar refinery. “A more self-contained plant plan than ours it would be hard to imagine,” Goetzinger bragged. On staff were physicians, chemists, steamboat captains, chauffeurs, teamsters, wagon makers, harness makers, machinists, draughtsmen, blacksmiths, tinsmiths, coppersmiths, coopers, carpenters, masons, painters, plumbers, riggers, typesetters, pressmen, chefs, and waiters. There were engineers of every description: mechanical, civil, electrical, chemical, railroad.

  After John Arbuckle’s death in 1912, his nephew, Will Jamison, had successfully launched the high-quality Yuban brand with his mother, Mrs. Catherine Arbuckle Jamison, and aunt, Christina Arbuckle, as financial partners. According to Goetzinger, the two elderly sisters took “the keenest interest in all our more important problems,” but they did not take part in active management.

  In 1921 Arbuckle Brothers made a fateful decision. The J. Walter Thompson advertising men, jubilant over the swift ascendancy of Yuban in New York and Chicago, wanted to take the brand national. They presented a comprehensive thirty-three-page report documenting “the opportunity for a nationally advertised coffee, and none is in so ideal a position to take advantage of it as Yuban.” The agency suggested a major full-page advertising campaign in the Saturday Evening Post, Ladies’ Home Journal, and Pictorial Review. The five-year campaign would cost Arbuckle Brothers approximately 1.5 cents per pound of coffee.

  But Arbuckle Brothers rejected the plan. A JWT memo offers only one sentence of explanation: “After consideration, they decided that the effort and cost of going national was too great for them.” It is surprising that Will Jamison would not have recognized the wisdom of the campaign, since he had been responsible for Yuban’s triumphant 1912 introduction. Although it is only surmise, it seems likely that his mother and aunt, who owned the majority of the stock, vetoed what appeared to them to be an expensive and perilous undertaking.

  Whatever the reason, Arbuckle Brothers stopped growing. Within the next few years the two elderly women died. Then in 1928 Will Jamison also died, leaving the company to his two sisters, Margaret and Martha Jamison, who neither married nor took much interest in the coffee business. By the end of the twenties, the Arbuckle brands had been largely pushed off the shelves by nationally advertised brands. The frustrated J. Walter Thompson men gave up the Arbuckle account and began to look for another coffee that they could promote in popular consumer magazines.

  The Corporate Monsters Swallow Coffee

  In the summer of 1929, within months of each other, two new corporate giants came into being, signaling a new age in the production of consumer goods and the ultimate death of family businesses. In February Royal Baking Powder Company snapped up Chase & Sanborn Coffee, whose gross sales now topped $12 million annually. A few months later the Fleischmann Company bought Royal, along with Chase & Sanborn, and reincorporated as Standard Brands. Already delivering perishable yeast twice a week to grocers, the new management put coffee on the same trucks, adding the packaging date. “It’s dated,” ads announced, supposedly assuring Chase & Sanborn’s freshness.

  In July 1929 Postum, which had swallowed Maxwell House Coffee, renamed itself General Foods. Maxwell House had been a very attractive acquisition. Under the leadership of Joel Cheek and his numerous offspring, it had continued to expand throughout the twenties. In 1921 Maxwell House had entered New York, building a gigantic roasting plant in Brooklyn and running ads that showed flappers sipping from dainty cups, “Good to the Last Drop.” In just over two years Maxwell House had overtaken Yuban to become Manhattan’s top brand.

  The Southern coffee’s successful invasion of New York City naturally attracted the attention of the J. Walter Thompson admen, whose national ad proposal had been turned down the year before by Arbuckle Brothers. In 1922 JWT executive John Reber approached Frank Cheek, who managed the Brooklyn plant, but he couldn’t shake the Maxwell House allegiance to its little-known advertising agency, Cecil, Berreto, and Cecil. After two years of courtship the JWT men finally won the cherished Maxwell House contract. The coffee firm had just opened a new roasting facility in Los Angeles. “An important factor in our favor proved to be our having a going California office,” a JWT memo noted.

  Another factor may have been the Thompson agency’s increasingly sophisticated manipulation of potential consumers through a combination of surveys and psychology. In 1921 the J. Walter Thompson agency hired John B. Watson, famed as the father of behaviorism, a new school of psychology emphasizing how positive or negative stimuli could shape behavior. According to Watson, humans responded best to stimuli that evoked fear, rage, or love. “Tell [the consumer] something that will tie [him] up with fear, something that will stir up a mild rage, that will call out an affectionate or love response.” Once surveys revealed which buttons to push, “any object or person in the world can be made to call out a love response.”47 He sought “such proficiency in our science that we can build any man, starting at birth, into any kind of . . . being upon order.”

  When Watson arrived at J. Walter Thompson, he spent nearly a year in a kind of advertising boot camp. “Yubanning is a strenuous job,” Watson wrote to a friend. “We are up at 6:30 A.M., have a meeting at 7:45 and by 8:15 we are on the trail of the grocer.” By 1924, when JWT snared the Maxwell House account, Watson had risen to vice president and become the ad agency’s “chief show piece,” as a snide contemporary journalist put it.

  Though Watson did contribute to the Maxwell House campaign, it was run by another famed JWT account manager, James Webb Young, whose youthful experience included evangelical door-to-door Bible sales in the South. A surprising number of early copywriters with a religious background were attracted to the secular advertising pulpit. “Business had become almost the national religion of America,” Frederick Lewis Allen observed in Only Yesterday, his classic book on the twenties. “So frequent was the use of the Bible to point the lessons of business and of business to point the lessons of the Bible that it was sometimes difficult to determine which was supposed to gain the most from the association.”

  Young conducted surveys of San Francisco and Chicago housewives, along with home tests of Maxwell House. Coffee, he wrote in an internal memo, was “one of the most intensively competitive fields in the world,” where Maxwell House had to counter “the aggressive sales and advertising attacks of competitors who in most cases had the advantage of working in their own home territory.” Moreover, the surveys revealed that 87 percent of the housewives cited flavor as the important factor in their brand choice. Yet “it is extremely difficult for the average person to make clear distinctions where flavor is concerned.” Young concluded that although women might think they were buying flavor, they really sought social status.

  As a traveling Bible salesman, Young had stayed at the old Maxwell House in Nashville several times. He knew how potent stereotyped Southern charm could be, since by that time he had invented Aunt Jemima to sell pancake mixes. Now he sent copywriter Ewing Webb to Nashville to stay in the hotel and soak up the ambience. Webb wrote compelling copy that positioned Maxwell House Coffee as the aristocratic drink of the Old South. Henry Raleigh, a “high society” illustrator, spent several weeks sketching in Nashville.

  J. Walter Thompson then launched its color ads—“A Carnival of Southern Hospitality”—in the Ladies’ Home Journal, Woman’s Home Companion, Good Housekeeping, and the Saturday Evening Post. Many Cheek-Neal salesmen and plant managers were appalled, since the Maxwell House Hotel was a “rather shabby relic of its former glory.” Yet image, not reality, was what mattered. The ads bent history to make Maxwell House Coffee sound more venerable than it was. “Over this coffee the North and South pledged the new brotherhood years ago.” Joel Cheek in fact had invented it in 1892. Sales increases in 1925 over the previous year were gratifying: some months jumped over 100 percent. The Maxwell House ads soon were expanded to show the coffee served at other prestigious hotels around the country.

  Letters of praise for
the campaign poured in. “I’m going to try Maxwell House Coffee and see if it’s as good as the advertising,” wrote one consumer. The moral was clear to the men at J. Walter Thompson. “Coffee may be advertised just as coffee—a drink which pleases the palate,” wrote James Webb Young in a company memo. “[But] we know that beauty, romance and social prestige mean more than almost anything to a woman,” he continued. “The outstanding modern hotels are considered absolute arbiters of correct social usage, particularly with regard to foods.” It appeared that the JWT team had, as John Watson suggested, refined its techniques so that “when you go out on the firing line with your printed message you can aim accurately and with deadly execution.” To Watson’s three stimuli of fear, rage, and love, the advertisers had added a fourth: a yearning for social prestige.

  The Roaring Twenties ushered in a new era in advertising. Along with the professional corporate manager and public relations man, the scientific adman had arrived. “It has all changed so rapidly it is astonishing and bewildering,” an old-fashioned advertising man groused in 1926. “No business is more serious. It is based on facts.” He yearned for the good old days. “Remorseless research data have destroyed all the color, adventure and romance so prevalent in the old advertising game.”