A Test for the Truth Tellers

With truth as its credo, Honest Tea encountered its first big test when a new drink called Zero (a name meant to dramatize the calories it didn’t contain) was ready to go on sale. The labels were literally at the printer’s shop when the partners discovered that their fermented cane sugar sweetener would add 3.5 calories to each bottle. Under U.S. government regulations, anything below 5 calories can be rounded down to 0 in labeling and advertising. No one would need to know that Zero didn’t quite live up (or down) to its name. But for Honest Tea, the discrepancy was crucial. “We couldn’t call it Zero if it was 3.5,” Nalebuff says. “So we changed the name and the product, too.” Making the drink just a bit sweeter and adding some agave juice to jazz up the flavor and boost the calorie count, the partners called it Ten.

In hindsight, that was the point at which the relationship with the customer began to outweigh the product—or, as Goldman puts it, when “[we] became more about the honest and less about the tea.” Their customers wanted a product that would make them feel good about their own bodies, their ethics, and their stand against an often dishonest world. Filling that need became the company’s top priority.