June 28, 2013

More companies cut ties with chef Deen

Target, Home Depot and others pull away as her empire crumbles for using a racial slur in the past.

The Associated Press

NEW YORK - Paula Deen's multimillion-dollar merchandise and media empire continues to unravel after revelations that she used racial slurs in the past.

Today - Season 62
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Celebrity chef Paula Deen dissolves into tears Wednesday during a “Today” show interview about her admission that she used a racial slur in the past.

The Associated Press

Target Corp., Home Depot Inc. and diabetes drug maker Novo Nordisk on Thursday became the latest companies to distance themselves from the Southern celebrity chef.

Home Depot, which sold Paula Deen-branded cookware and kitchen products only online, said it pulled the merchandise off its website on Wednesday. And Target said that it will phase out its Paula Deen-branded cookware and other items in stores and on its website.

"Once the merchandise is sold out, we will not be replenishing inventory," said Molly Snyder, a Target spokeswoman.

Meanwhile, Novo Nordisk said it and Deen have "mutually agreed to suspend our patient education activities for now." Deen, who specializes in Southern comfort food, had been promoting the company's drug Victoza since last year when she announced she had Type 2 diabetes.

These are the latest blows dealt to Deen since comments she made in a court deposition became public. Last week, the Food Network said that it would not renew her contract. On Monday, pork producer Smithfield Foods dropped her as a spokeswoman. Then on Wednesday, Walmart Stores Inc., the world's biggest retailer, said it was cutting ties with Deen following a tearful "Today" show interview in which she said she's not a racist.

On the same day, Caesars Entertainment announced that Paula Deen's name is being stripped from four buffet restaurants owned by the company. Caesars said that its decision to rebrand its restaurants in Joliet, Ill.; Tunica, Miss.; Cherokee, N.C.; and Elizabeth, Ind., was a mutual one with Deen.

The stakes are high for Deen, who Forbes magazine ranked as the fourth highest-earning celebrity chef last year, bringing in $17 million. She trails Gordon Ramsay, Rachel Ray and Wolfgang Puck, according to Forbes.

Deen's empire, which ranges from TV shows to furniture and cookware, generates total annual revenue of nearly $100 million, estimates Burt Flickinger III, president of retail consultancy Strategic Resource Group.

But Flickinger said the controversy has cost her as much as half of that business. He also estimates that she could lose up to 80 percent by next year as suppliers extricate themselves from their agreements.

"The accelerating domino effect is commercially disastrous for Paula Deen's empire," he said.

 

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