The $100 Million Apple : Planet Money Next week, a new product will hit store shelves. It's been in development for 20 years and cost millions of dollars to bring to market. It's a new kind of apple. And the stakes are high.
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The $100 Million Apple

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The $100 Million Apple

The $100 Million Apple

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STACEY VANEK SMITH, HOST:

Dan Pashman, welcome.

DAN PASHMAN, HOST:

Hey, Stacey.

VANEK SMITH: And you are the host of the great food podcast called "The Sporkful."

PASHMAN: That's right.

VANEK SMITH: And today, you are bringing us a very special story about apples.

PASHMAN: Apples. In the olden times, there were many kinds of apples. But then, you know, as the country - the food systems were industrialized, there was a big consolidation towards Red Delicious, in particular. And really, there was the red apple, Red Delicious. There was the green one and the yellow one.

VANEK SMITH: Granny Smith.

PASHMAN: Granny - right - and the yellow one, Golden Delicious. And those were the only apples. And most of those apples were picked because they looked nice. Red delicious especially looks very pretty.

VANEK SMITH: It's a beautiful apple.

PASHMAN: Right. And it's very durable. Like, the skin is very thick. It can sit on a shelf for a long time. So, you know, and that worked. Everyone was pretty much content with Red Delicious 'cause they didn't know what else was out there. Starting maybe in the '70s, you started to see the proverbial seed planted of a new apple movement.

VANEK SMITH: And it all started with one apple that became, like, this huge hit apple.

PASHMAN: Right. So now we - a lot of us now know about Honeycrisp, all right? It's probably the most expensive apple at your average suburban supermarket, for sure. And when Honeycrisp came along, it was - it blew up the industry because it showed people that consumers were willing to spend a lot more money for an apple that they thought was superior.

VANEK SMITH: And this apple was not just - I mean, this didn't just appear in the grocery store. This was actually developed like a product.

PASHMAN: Well, that's one of the big changes that has led to the proliferation of all these apples, Stacey, which is apple clubs - growers clubs. It's like a collective, or even like a franchise kind of situation. So you have growers who come together. And you, in order to get permission to grow a new variety of apple, you must pay money for the rights to grow that apple. You're licensing the apple.

VANEK SMITH: OK, so it's basically like opening up a Subway sandwiches or something.

PASHMAN: Exactly. You're paying for the right to...

VANEK SMITH: Grow a Honeycrisp.

PASHMAN: Right. And also, we're going to band together to market this apple. So it's going to - everyone's going to know the name SnapDragon or Pink Lady or, you know, whatever the new apple is going to be.

VANEK SMITH: Notably left out of the club system...

PASHMAN: Yes.

VANEK SMITH: ...Is the Apple State itself...

PASHMAN: Correct.

VANEK SMITH: ...Washington.

PASHMAN: Right.

VANEK SMITH: How did they get left out?

PASHMAN: Well, they're still stuck growing Red Delicious, and Red Delicious is falling out of favor.

VANEK SMITH: So Washington state is looking at this, like, apple revolution happening all around the country. And they're like, we have got to get in this. And so they decide that they're going to engineer a hit apple.

PASHMAN: Starting December 1, we will have a new apple. And this will be the biggest apple launch in history.

VANEK SMITH: An apple is born.

PASHMAN: Yes.

VANEK SMITH: And it is called...

PASHMAN: It is called the Cosmic Crisp.

VANEK SMITH: This is THE INDICATOR FROM PLANET MONEY. I'm Stacey Vanek Smith.

PASHMAN: I'm Dan Pashman from "The Sporkful" food podcast.

VANEK SMITH: And today on the show, the Cosmic Crisp.

(SOUNDBITE OF DROP ELECTRIC SONG, "WAKING UP TO THE FIRE")

VANEK SMITH: So Washington state, big apple growing state, decides it is tired of being left out of, like, the big apple revolution that's happening all over the country and it wants to create this new apple. But that is a complicated process. It's expensive and time-consuming.

PASHMAN: Yeah, it takes decades. The way that you breed a new apple is actually pretty simple and straightforward in the sense that it's just like - you grow an apple tree - a bunch of apple trees. You pick the apples. You taste them. You see which ones are best. And then you take the seeds out of those apples that are best, and you plant them in the ground. And then you have a new batch of - whatever - 20 trees that take another few years. Then you try all those apples and pick the very best. And you can keep picking the best seeds until you end up with an apple that blows your mind. But that can take, as it did in this case, 20 years.

VANEK SMITH: And there is a woman who is in charge of this process who has been overseeing all the apples and seeds and tests. And you talked to her.

PASHMAN: Her name is Kate Evans.

(SOUNDBITE OF PODCAST, "THE SPORKFUL")

KATE EVANS: I am the leader of the Pome Fruit Breeding Program at Washington State University. I'm a professor of horticulture.

PASHMAN: Did you just say pomme frite?

EVANS: I (laughter) - good one. Pome fruit, I said. So apple is a pome fruit, as is pear and quince and other similarly related fruits.

PASHMAN: Got it.

EVANS: I cover apples and pears.

VANEK SMITH: And so it's Kate's job to basically figure out how to make a hit apple. And there are all these metrics that you use.

(SOUNDBITE OF PODCAST, "THE SPORKFUL")

EVANS: It's firmness, crispness, juiciness - all of those things combined. And then, of course, you have the effect of the skin because the skin to the flesh makes a difference in terms of how you perceive the texture.

PASHMAN: Yes.

EVANS: And then you've got all those flavoral traits. You've got tartness and sweetness, aromatics, but also trying to combine that with those traits that would make it work for the grower and for the whole production line.

VANEK SMITH: And so they're looking at this basically giant universe of all these different apples, and they're breeding this one and this one and this one. But the Cosmic Crisp has two pretty famous parents.

PASHMAN: So Cosmic Crisp's parents are Honeycrisp - and so they paired Honeycrisp with an apple called Enterprise. So the Enterprise is more durable and also has a different appearance. And so part of why the Cosmic Crisp got the name it got is that, you know - this is the level that we're at here with these apples in development - they do focus groups.

VANEK SMITH: They do focus groups for apples?

PASHMAN: They do focus groups...

VANEK SMITH: Like, with two-way glass and a bunch of people sitting around a table being like, I think it's too crispy?

PASHMAN: Yes. And...

(LAUGHTER)

PASHMAN: They do focus groups for apple names.

VANEK SMITH: Really?

PASHMAN: So they have people eat the apples. And they say, what flavors does this evoke? What does it make you think of? And then how do you feel if the apple would be named this versus that? And one of the things that people said was that the app - the yellow flecks on the outside of the apple resembled stars.

VANEK SMITH: Oh.

PASHMAN: And that got people thinking cosmic.

VANEK SMITH: So, like, how much money did Washington State University spend on all of this, like, marketing and focus groups and breeding and stuff like that?

PASHMAN: Tens of millions of dollars. But they stand to make a hundred million.

VANEK SMITH: A hundred million dollars, so why - how - wow.

PASHMAN: (Laughter).

VANEK SMITH: And how much are they going to spend marketing it?

PASHMAN: Ten million dollars.

VANEK SMITH: They're spending $10 million marketing this new apple. And that is - what? - like, TV ads?

PASHMAN: First of all, like any big star making its first appearance in the public, this apple has a PR firm.

VANEK SMITH: Really?

PASHMAN: Yes. They're called...

(LAUGHTER)

PASHMAN: They're the same company that worked on the branding and the naming. And they also do the publicity for the apple.

VANEK SMITH: I mean, you can market the bejesus out of something, but people have to like it. And you actually, Dan, got a special sneak peek...

PASHMAN: That's right.

VANEK SMITH: ...Of the Cosmic Crisp.

PASHMAN: I got an advance apple.

(LAUGHTER)

VANEK SMITH: You got an advance apple.

PASHMAN: An advance copy of the apple.

VANEK SMITH: And you actually recorded yourself trying it.

PASHMAN: Yes.

VANEK SMITH: So we have tape of that. So let's play that tape.

(SOUNDBITE OF PODCAST, "THE SPORKFUL")

PASHMAN: All right. I'm going in.

(SOUNDBITE OF APPLE CRUNCHING)

PASHMAN: It's extremely crunchy, extremely juicy, extremely sweet and also acidic. Like, it's just - it's like a technicolor apple.

VANEK SMITH: So now the $10 million question, Dan Pashman, would you pay extra - would you pay a little more to buy this apple?

PASHMAN: It depends on a little more than what? I mean, in my house, we already don't really ever get Honeycrisps.

VANEK SMITH: Really?

PASHMAN: My wife is not on board with paying so much extra for the Honeycrisp. She - we don't - I don't make Honeycrisp money, Stacey.

VANEK SMITH: Well, yeah, no one in public radio makes Honeycrisp money.

PASHMAN: (Laughter).

VANEK SMITH: I mean, that's crazy.

PASHMAN: No, no. I know. But I would certainly pay more for this apple than for what I will call the average apple brand X...

VANEK SMITH: OK.

PASHMAN: ...Because it was so juicy. And it's also huge. I mean, I was very hungry when I went to eat this apple, and I ended up feeling, like, pretty satisfied just eating an apple, which is not common for me.

VANEK SMITH: What happens if people don't buy this apple?

PASHMAN: Well, the people who would be hit hardest are the growers in Washington state.

VANEK SMITH: Right. They've, like, ripped up all their trees and planted these new trees.

PASHMAN: Exactly. And it would be many years before they could make any kind of a change. I'd be surprised if it flops 100% because the apple is very good and because it has so much money and power behind it. But none of us can say for sure.

VANEK SMITH: Wait; are they ripping out Red Delicious trees and putting in Cosmic Crisp trees? Is that what happens?

PASHMAN: Yeah, yeah, yeah.

VANEK SMITH: Oh, so the Washington state growers were like, OK, no more Red Delicious. We're going to - like, we're betting it all on the Cosmic Crisp.

PASHMAN: I wouldn't say betting it all. I mean, there will still be Red Delicious. But, yes, there will be fewer Red Delicious produced and more Cosmic Crisp.

VANEK SMITH: I mean, farmers generally don't have huge margins of error in their budgets and stuff, so this is a big risk for them.

PASHMAN: Absolutely.

VANEK SMITH: I mean, has there been an apple that's flopped?

PASHMAN: I don't think there's ever been an apple launched like this.

(SOUNDBITE OF DROP ELECTRIC SONG, "WAKING UP TO THE FIRE")

VANEK SMITH: Do you have some episodes that people should definitely tune in to listen to?

PASHMAN: Well, we did do an episode in October that I hope folks will check out all about the use of the word plantation in food branding, and it becomes, really, an episode about whiteness in America. So you can check out that episode of "The Sporkful" wherever you get your podcasts.

VANEK SMITH: Yep, check it out.

This episode of THE INDICATOR was produced by Leena Sanzgiri. Our intern is Nadia Lewis. Our editor is Paddy Hirsch. And THE INDICATOR is a production of NPR.

(SOUNDBITE OF DROP ELECTRIC SONG, "WAKING UP TO THE FIRE")

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