From Honest to Just: How Coca-Cola’s Fumble with Honest Tea Turned Into an Unexpected Gift

This story was original published by GreenMoney Journal and is reprinted with permission. 

Two years ago this month, I was informed by senior leaders from The Coca-Cola Company that Honest Tea, the brand I launched out of my house in 1998, would be discontinued.

Despite the brand’s success as the world’s first organic and Fair Trade certified bottled tea brand, supply chain disruptions during the pandemic made Honest Tea a victim of Coke’s “Fewer, Bigger Bets” strategy.

But what felt like a huge setback turned out to be a gift, and an interesting lesson in the challenges big corporations have in scaling mission-driven brands.

Within ten days of hearing the news about Honest Tea’s demise, our sense of loss morphed into a determination that Honest Tea’s organic and Fair Trade values were too important — to our farmers (most of whom found out about Honest Tea’s termination from my LinkedIn post) and our customers — to be allowed to disappear. But the biggest piece of inspiration came via an email I received from one of our longtime tea suppliers:

"I am just hearing the news and reading your note on LinkedIn," the supplier wrote. "The story of Honest Tea is very connected to our own, our company, and the gardens and people with whom we work at origin, so the news is definitely a 'gut punch,' for us as well. For my father and myself, while the financial consequences are material, the loss of confidence in Organic and Fair Trade agriculture that this decision is likely to engender in the wider community is very saddening and probably more consequential over the long term — especially in terms of lost motivation at origins. We have been so inspired to be part of the journey that you led, and want to try to continue the effort (and fight the suggestion that this was all a failed experiment)."

After receiving that email, I didn’t need any more convincing! Of course, we also looked at the market and were convinced that there was an immediate opportunity to capture much of Honest Tea’s volume, which had grown to $75 million before I left, as well as expand beyond that size because the receptivity to Organic and Fair Trade had grown since 2019. It was also clear that since the pandemic there had been no innovation in bottled iced tea. The shelves were filled with the usual suspects — Arizona, Snapple, Pure Leaf and Gold Peak — and no one was bringing anything fresh or exciting to the category.

We couldn’t buy back the Honest name because Coke was still building Honest Kids, so my Honest Tea co-founder Barry Nalebuff and I brainstormed over a weekend and came up with a new name that would help communicate what our new brand would stand for. We came up with Just Ice Tea. My Eat The Change co-founder, Chef Spike Mendelsohn, started brewing recipes that were enhancements of Honest Tea’s greatest hits.

By September 6, 2022, less than 100 days after we heard the news about Honest Tea, we had sold our first bottle at a PLNT Burger restaurant in New York City. Today Just Ice Tea is the top-selling bottled tea brand in the natural channel, as tracked by SPINS. Our sales hit $16 million in the past 12 months, and we are just starting to sell into national foodservice, drug, mass and convenience chains.

Shakespeare wrote in All’s Well that Ends Well, “No legacy is so rich as honesty.” So, before I focus on the impact of Just Ice Tea, it feels appropriate to reflect on Honest Tea’s legacy:

• Honest Kids, our lower-sugar organic juice drink, is still flourishing as the top-selling organic kids juice drink. It is distributed nationally in more than 100,000 outlets, including McDonalds, Wendy’s, Subway, Chik-Fil-A and Arby’s — none of which come to mind when you think of an organic drink. Our aspiration to democratize organic foods is being realized.
• The caloric impact of Honest Kids is profound. The placement of the 35-calorie drink boxes at McDonald’s, where they replaced an 80-calorie juice box at the same price point, has contributed to removing more than 1 billion empty calories from the American diet.
• Dozens of amazing entrepreneurs who got their start with Honest are now building the next wave of mission-driven brands. The branches of the Honest employee tree extend into many of today’s most cherished brands including Good Culture, Calicraft, Aldi, Super Coffee, Rishi, Timberland, Beyond Meat, Jeni’s and Partake Foods.
• Ripples in the mission-driven space continue. The success of Honest inspired thousands of entrepreneurs, investors, and larger food companies to embrace the healthier, organic and Fair Trade approach to food. Our book, "Mission in a Bottle: The Honest Guide to Doing Business Differently," which was a New York Times bestseller, helped provide the playbook for tens of thousands of rising leaders.

Shortly after we launched Just Ice Tea, I took my co-founder Chef Spike Mendelsohn to a tea garden in Zambezia Province in Mozambique (pictured above). The landscape was breathtaking – green rolling hills, surrounded by fragrant eucalyptus trees, laced with waterfalls and streams flowing throughout. Roughly 10,000 people live throughout the tea fields. In addition to picking tea leaves, they grow their own crops for food and income.

Even with the higher-than-normal Fair Trade USA wages that Cha de Magoma pays the tea pickers, Zambezia Province is one of the poorest provinces in one of the poorest countries (186 out of 192) in the world. The average life expectancy is 54.6 years. Not only are cholera, malaria, and AIDS major threats, but residents also lack access to medical services to diagnose these illnesses.

When we met with the Worker’s Council that decides how our Fair Trade premiums are spent, they requested we focus our donations on building a pathology clinic that can test, diagnose and provide basic treatment for illnesses. Without access to this kind of resource, villagers need to travel 90 minutes, which is especially challenging since they lack access to cars. This year we will be contributing and raising funds for the medical equipment needed to launch this facility.

When we launched Just Ice Tea, we wanted to honor and celebrate what Honest Tea stood for, but promised ourselves we wouldn’t be operating with an old playbook. The launch of our new canned line is the latest example of our commitment to think more broadly and boldly about where Just Ice Tea can go. The cans should help support our efforts to democratize organics by making more sustainable and healthier foods and drinks available to more people because of their lower price point. 

The whole Honest-to-Just Ice Tea experience has confirmed for me that Karma is real — and positive intentions and actions count. Because we tried to do the right things at Honest Tea, every part of the supply chain was eager to work with us again — farmers, retailers, distributors, suppliers and co-packers, not to mention investors and consumers.

Honest Tea’s termination created a big hole in the marketplace, and we have been fortunate to be able to fill a lot of it. Now it’s up to us to see if we can take Just Ice Tea beyond where Honest went and realize the full promise of the brand and the values it represents.

This story was original published by GreenMoney Journal and is reprinted with permission. 

Listen to Cliff’s GreenMoney interview with Seth Goldman at the 30th SRI Conference in 2019 – reflecting on what it takes to keep a social mission at the center of a brand.