Scandal Will Cost Paula Deen Over $10 Million, Says Crisis Manager
Paula Deen's teary-eyed defense on this morning’s Today Show wraps up a week of controversy that will cost the former Food Network star an estimated $4.5 million, according to Forbes. But the financial toll on Deen's empire will grow.
Wal-Mart just announced today that it is cutting ties with Deen. Dave Tovar, a spokesperson for the company, said Wal-Mart will not place "any new orders beyond what's already committed." Deen has sold a variety of branded products from grocery items to health products at the world's largest retailer since 2011. And Caesar's also announced on Wednesday that Deen's name is being stripped from four buffet restaurants it owns.
“She will never be whole again,” says Howard Bragman, Vice Chairman of Reputation.com and a long-time crisis manager. “You just can’t say it’s a one-time hit of $3 or $4 million dollars, I think it’s much more than that. I think its tens of millions of dollars when you look at it over time.”
In the Today Show interview Matt Lauer asked Deen if she was there “to express what she just said or to stop the financial bleeding.” Deen responded by saying that she was there because she wanted people to know exactly who she was.
Bragman tells The Daily Ticker that the interview was more of a business move, “today’s interview was an attempt to define herself and from a business point of view to stop the bleeding, to stop the attrition of brands.”
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The southern chef has published 14 cookbooks, runs seven restaurants, and has hosted two Food Network shows. Deen became embroiled in a legal suit when a former manager at one of her restaurants alleged sexual harassment and a workplace rife with racism.
In testimony, Deen admitted that she had used the N-Word and other racist remarks in the past. Her admission prompted Smithfield Foods, the world’s largest pork producer, to dump Deen as their spokesperson.
Last Friday The Food Network also announced that they would be dropping the 4th highest-earning celebrity chef after 11 years with the channel.
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QVC, which sells a line of cookware created by Deen, has released a statement saying that they are "closely monitoring these events and we are reviewing our business relationship with Ms. Deen. In the meantime, we have no immediate plans to have her appear on QVC."
According to Forbes, the star brought in an estimated $17 million in 2012 but will Deen, 66, be able to recover from the recent blows to her butter-fueled empire?
It will be tough, according to Howard Bragman: “It’s safe to say her brand is tarnished and even damaged to a great extent, she’s lost money but more importantly her reputation.”
If Paula Deen were his client, Bragman says he'd advise her to not do any more interviews. “You do it once, you do it seemingly well and I think there should be a lot of behind the scenes work with her brands touting that she did the interview and she was courageous, talking about the support that’s coming out for her.”
In the video above Bragman explains that he would transition the business away from Paula Deen. Watch to find out whom he would like to see as the new face of her company.
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