Issue link: https://read.dmtmag.com/i/491371
STiR tea & coffee industry international 37 broke the Keurig code and began offering capsules with lids printed with infrared ink that will work in the 2.0 machines. During the past six months Keurig-licensed selections increased to 400 beverage varieties offered by 60 brands. Keurig prevailed against big-name private-label competitors like Kraft but the cost in goodwill is high in the 20 million kitchens and offices that stock- piled portion packs that only work in first-generation brewers. Customers complain Hundreds of consumers in product reviews on influential websites, especially Amazon, also voiced their anger at Keurig's decision to no longer offer "My Cup" refillable capsules. Instead of brewing their morning cup of coffee, users inserting any of the 6 billion capsules manufactured before mid-year saw an "Oops" message di- recting them to a website. There they were advised that Keurig was ensuring "the system delivers on the promise of excellent quality beverages produced simply and consistently every brew every time." In fact the new brewers are less versatile than the last generation 1.0 ma- chines and in the short term, 2.0 offers fewer coffee selections. Many resent the lock out. Hostile reviews and YouTube videos offer de- tailed instructions on how to defeat the infrared reader mounted above the capsule. One popular technique is to remove the lid from a licensed cup and tape it to the old capsule before inserting it into the new brewer. The bad buzz led Keurig's consumer relations team to quickly disable the comment board on its own website. Reviews were later restored averaging 4 stars by December. Amazon's 704 reviews averaged 2 stars. The company was reportedly surprised at the amount of 1.0 inventory in kitchen pantries and initially offered to send new version K-Cups to compensate for the in- convenience. That proved expensive and brewer owners were later given dis- count codes to get a free pack of the 2.0 capsules. Customers purchasing a Keurig for the first time were less critical of the 2.0 brewers. The new portion packs are heavily discounted as well with $10 off and free shipping for orders of five boxes or more. The professional reviewers at CNET offered this assessment: "The Keurig K500 is a fine single- and large-serving coffeemaker in its own right, but it's difficult to recommend. New buyers can do much better with a brewer that's more flexible and less expensive, like the Bunn MyCafe MCU. If you're a Keurig loyalist who already owns a brewer, upgrading to Keurig 2.0 will only leave you with fewer coffee brands to choose from. Unless being able to brew an entire pot is worth it to you, you're almost certainly better off saving your money and sticking with what you already have." In November Remington introduced the iCoffee Opus single-serve brewer at Bed Bath & Beyond locations. It was packaged with non-licensed Tim Hor- tons coffee in RealCup brand capsules manufactured by Mother Parkers. Retailers report brisk sales of Bunn's MyCafe and the much less expen- sive K-Cup compatible Hamilton Beach 2-way FlexBrew ($65 at Wal-Mart). Al Rankin, chairman and c.e.o. at NACCO, which owns Hamilton Beach, said that he expects 2015 revenues and net income from these brewers "to increase over 2014 due to increased product placements and sales volumes." In his most recent quarterly earnings call Rankin cautioned that "sales volumes in the middle market portion of the US small kitchen appliance mar- ket in which with Hamilton Beach participates, are projected to grow only moderately in the remainder of the year." The number of competing brewers, including those with a carafe option and the "two-star" ratings that predominate on consumer websites likely discouraged Keurig owners from upgrading. Price is another consideration. The Keurig 2.0 K350 lists at $149.99 (discounted to $118 at Wal-Mart). All three new brewers cost $20 to $30 more than last year's brewers, a 17% hike compounded by a big increase in the price of portion packs. Wal-Mart adver- Keurig licensed roasters moved quickly to clear out any 1.0 portion-pack inventory but home- owners had large stocks in their pantries. Non-lincensed capsules that work in Keurig's 2.0 brewer are now available in stores.