One family, two histories. Niall Firth reviews the fascinating story behind the official and unofficial histories of iconic American sauce manufacturer Tabasco
It could be the script for the opening scenes of a feel-good Hollywood movie celebrating the American dream. With the country lying in tatters in the wake of the American civil war, a weary plantation owner returns to his Louisiana farm to find that the only thing that has survived in the ravaged landscape is a bright red fiery chilli pepper.
According to the story, these wonderful plants, which were to become the key to a revival in the McIhenny family's fortunes, had been planted after the young Edmund McIlhenny received a handful of special peppers from a Confederate soldier during the war. Years later they would form the basis not only of Tabasco sauce – but of one of America's most successful family businesses.
The symbolism is striking. From this fiery survivor of the most turbulent and destructive period in the country's history, an American icon was born. Or so the story goes, at least. Unfortunately it's just a bit too good – and that's the problem.
According to a new and, crucially, unauthorised history of the McIlhennys and Tabasco, myth-making is an essential part of this iconoclastic family's history. In fact, there are so many stories and alternate histories surrounding the family and their Tabasco business that even many family members find it difficult to separate fact from fiction, says Jeffrey Rothfeder in his book McIlhenny's Gold: How a Louisiana family built the Tabasco empire.
Rothfeder, a successful business journalist with a keen interest in the workings of family businesses, has provided an intriguing look at one of the most unique and insular family businesses in America. The McIlhenny family refused to cooperate with Rothfeder's book – he describes them as a "slippery subject to explore" – forcing him to instead rely on speaking to anonymous relatives and archived sources for his research. What he unearthed makes fascinating reading.
It was, in actual fact, a local businessman named Maunsel White, a well-known bon viveur who entertained the great and good of New Orleans in the 1840s, who was probably the first to develop something that could be a recognisable version of the famous spicy sauce.
White was something of a gourmand in that thriving city and threw fabulous gourmet parties at his plantation attended by all of the glittering celebrities of the time. It was here that he served his famous White's Concentrated Essence of Tabasco Peppers.
At this time Edmund McIlhenny, the founder of the Tabasco family business, was a highly successful investment banker in the city and so it is inconceivable that he did not know White personally or had at least heard about his famous parties. And, of course, he would certainly have heard of White's famous pepper sauce, suggests Rothfeder. Unsurprisingly, this rather less romantic version of events doesn't get a mention in the McIlhenny family's own glossy coffee-table sized Tabasco: An Illustrated History, released at the same time as Rothfeder's own planned publication. "The reason their book is coming out is because of my book," Rothfeder has claimed of the apparently coincidental release of the two Tabasco books.
The McIlhennys have remained sole owners of their Tabasco empire since its beginnings, and despite a brief dalliance with a non-family CEO, have passed their business intact through five very different generations. This fact is remarkable in itself because, as Rothfeder notes as he follows the Tabasco story from one eccentric family member to another, around 30% of family businesses fail to survive the death of the founder.
That is why, with worldwide annual sales topping 150 million bottles, it's perhaps difficult to be too critical of the McIlhenny's business model. However, it is easy to come to the opinion that the Tabasco empire has survived more in spite of the family's business methods than through any particularly shrewd long-term financial strategy.
Stumbling from one crisis to another, the family's single-mindedness has been one of the constants of its almost 140-year reign as the king of American hot sauces – despite a thriving competitor's market.
To begin with, the McIlhennys discovered what many other families learn as their business crosses the generational divide. Each new family member will always have their own ideas about how to take the business on – but not every family member is cut out for managing such a global empire. What is remarkable about the McIlhennys is not only the family's ability to weather the various storms of the past 140 years, but to succeed by completely refusing to do things by the book.
One of the many ways in which the McIlhenny's idiosyncratic and single-minded approach to the family business model differentiates them from their contemporary rivals is their unwillingness to diversify. Industrial behemoths such as Heinz and Kraft, which began from the same humble roots as Tabasco, quickly scaled up their production facilities and branched out into other products after their initial foray into the market had proved successful.
Edward McIlhenny however, perhaps Tabasco's most famous patriarch, was adamant that Tabasco should only have one product and that no compromise on quality either through industrial production or cheaper ingredients would be even considered. Bizarrely EA, as he was known, was far more interested in semi-philanthropic ventures such as the creation of a "company village" where all of the staff could live and work in a custom-built township, complete with medical services and schools.
A hard-backed monster of a book, Tabasco: An Illustrated History was never going to offer us any particularly salacious details about the family. Glossy, expensively produced and packed full of detailed (if understandably one-eyed and slightly fawning) biographies of the various McIlhenny CEOs, An Illustrated History does occasionally touch on slightly sensitive subjects. However, while EA's battles to protect the Tabasco brand name get a mention, his slightly dodgy dealings with the patent office in doing so, do not.
Another, rather shameful, incident in 1944, which does not get a mention at all, is when EA refused to step in or even acknowledge a serious racial incident involving leading black activists being beaten and expelled from the area. The "New Iberia" incident, as it became known, rather sullied the family's previously good name in terms of race relations.
However, Dr Shane Bernard, the book's author and Tabasco's full-time archivist, manages to skirt discreetly clear of any such potentially embarrassing revelations. This means what we are left with is a rather pious, if beautifully produced, history of the McIlhennys enlivened with plenty of Tabasco-based cocktail and food recipes as well as pages of historical adverts thrown in for added value.
However, it does give an insight into the brand's capacity for myth-making and an approach to history that occasionally veers closer to family doctrine than to actual fact. One noteworthy example of this is the curious disappearance from history of the family's first and only experiment with a non-McIlhenny chief executive, Vince Pierse.
Unlike many of Tabasco's CEOs, Pierse was an extremely experienced senior manager across a wide range of food products and for 10 years he had been working as an advisor to the Tabasco family business. The business was in trouble and with an increasingly large number of McIlhenny dependents clamouring for a bigger share of the pie, the board decided that something needed to be done to improve profits. In an angst-ridden meeting, senior family members were eventually convinced that Pierse was their man to take the business forward.
Pierse's short but productive reign oversaw an unprecedented marketing drive to rejuvenate the sauce's flagging domestic market, including one of the iconic commercials of the 1990s: the award-winning "Mosquito ad" that filled a prime spot during the commercial breaks at the 1998 Super Bowl. His time in charge also saw a rise in Tabasco sales worldwide, but his marketing expenses unnerved the McIlhenny hierarchy and he was swiftly deposed and replaced by the current CEO Paul McIlhenny.
Tabasco's official history makes no mention of Pierse's stewardship save for one off-hand comment which judges Pierse's time in charge as "a short-lived experiment." At no point is Vince Pierse's name even mentioned.
From the family's notorious insularity to its ability to buck received business advice and still come out on top, the birth of Tabasco sauce is one of America's most fascinating brand success stories.
While Rothfeder notes in McIlhenny's Gold that "the desire to sugarcoat the truth is a recurring motif" in the family's story, he is evidently impressed by the family's resilience in the face of more than a century of industrial change.
However, what is clear is that the family business cannot continue forever in its current form. The family's multitude of dependents is only increasing while Tabasco's profit margins remain static, albeit impressive.
But no matter what happens in the future, whether the family goes public or even sells up to a giant corporation such as Heinz or Kraft, the McIlhenny story remains a fascinating glimpse at one of the most enduring, unusual, and successful family businesses in modern history.