Hot Pockets - Berkeley Haas News

Magazine Fall 2019

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Hot Pockets Alumni Notes Fall 2019 Haas Community How We’re Duped by Data Cover Story Real Estate Prophet Open Innovation Results New Technologies Conscientious Connector Award Winner How the Wealth Was Won Market Watch Anger Management Leading Teams Offensive Charm Communication Nobel Pride Faculty Giant Fearlessly Curious Quants Financial Engineering Shaking Up Fine Wine Sales Kate Hart, MBA 86, Little League Baseball Umpire & Senior Brand Manager, The Wine Group Question the Status Quo Purvi Gandhi, BS 92, Partner and CFO, Hone Capital Confidence Without Attitude Ace Patterson, MBA 16, Hip-Hop Artist & Consumer Marketing Operations Manager, Facebook Beyond Yourself Rob Chandra, BA 88(Economics) Beloved by Students Tracing an Epidemic Faculty Research Mentor Extraordinaire Faculty Accolades Hot Pockets Tony Chan, BS 74, Owner, Managing Member, Worldco Holding, LLC Volunteer of the Year Worldwide Events Fall 2019 THE HAAS COMMUNITY PAGES Fall 2019 View Content Hot Pockets

How one alum’s ingenuity gave rise to a pop-culture icon

By

Amy Marcott

Photographs by

Nestle

When Paul Merage, BS 66, MBA 68, first conceived of the idea for Hot Pockets in the late 1970s, it was to address shifts in the American family. Hungry kids needed an after-school snack while moms were out working, and more people were eating on the run. Nearly 40 years and one memorable jingle later, the microwaveable sandwich, in flavors such as pepperoni pizza and cheeseburger, is forever embedded into the American consciousness. Before selling to Nestlé, Merage’s company, Chef America, was manufacturing 30 different products, including Lean Pockets, Croissant Pockets, Pizza Minis, and Toaster Melts, with annual sales of $750 million. Here’s a look at the rise to fame of Hot Pockets.

1977

After stints as a marketer for major food companies, Merage mortgages his house and starts Chef America with his brother, David. They invent a frozen Belgian waffle for restaurants and coffee shops, earning millions.

1980

Merage has been spending evenings developing a portable stuffed sandwich, and Chef America introduces the Tastywich to restaurants (only ~10% of homes have microwaves). Merage continues testing crust recipes on family.

1983

The renamed Hot Pockets hit the market (still sold to businesses, not yet direct to consumers). The secret? A patented dough and a sleeve that essentially broils a “crispy crusty tender flaky crust.” High unemployment (10.8% in Dec. 1982) makes cheap, easy meals welcome.

“Try the Hot Pockets; they’re breathtaking.” —Dr. Evil, from Austin Powers: The Spy Who Shagged Me

1985

Hot Pockets are sold in supermarkets nationwide. Microwave ovens are increasingly popular, now in nearly 25% of homes, according to the Bureau of Labor Statistics.

2001

Breakfast flavors of Hot Pockets rack up a whopping $50 million in year-one sales, according to The Wall Street Journal. Chef America adds 10% more filling to its products— without raising prices. Subsequent sales rise 32% in 2002, far outpacing the overall food industry.

2002

The Merage brothers sell Chef America to Nestlé for $2.6 billion, then devote themselves to philanthropy.

2005

Merage donates $30 million to UC Irvine business school, now named the Paul Merage School of Business.

"WHAT ARE YOU GONNA PICK? HOT POCKETS!"

The Hot Pockets jingle is memorable, but Chef America actually avoided pricey advertising, like product placements. Nevertheless, they landed plum plugs that helped solidify the food’s pop-culture status. They are twice mentioned in 1999’s movie Austin Powers: The Spy Who Shagged Me. Comedian Jim Gaffigan ribbed the food in a well-known 2005 stand-up routine. TV shows, including Breaking Bad, Family Guy, and Veep have referenced the product. And in 2012, Snoop Dogg rewrote his song “Drop It Like It’s Hot” to sell Hot Pockets: “Pocket Like It’s Hot.”

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