Target cuts ties with Deen; drugmaker distances
In this publicity image released by NBC, celebrity chef Paula Deen appears on NBC News' "Today" show, wednesday, June 26, 2013 in New York. Deen dissolved into tears during a "Today" show interview Wednesday about her admission that she used a racial slur in the past. The celebrity chef, who had backed out of a "Today" interview last Friday, said she was not a racist and was heartbroken by the controversy that began with her own deposition in a lawsuit. Deen has been dropped by the Food Network and as a celebrity endorser by Smithfield Foods. (AP Photo/NBC, Peter Kramer)
NEW YORK (AP) — Paula Deen's multimillion-dollar merchandise and media empire continues to unravel following revelations that she used racial slurs in the past.
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, Wal-Mart Stores Inc., the world's biggest retailer, said it too 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's behind Gordon Ramsay, Rachel Ray and Wolfgang Puck, according to Forbes.
Deen's empire, which spans 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 says that 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.
It's a dramatic fall from a woman who overcame her humble Southern roots and personal hardships to build a merchandising and media empire.
Deen, who grew up in Albany, Ga., was grappling with a failed marriage, the death of her parents and a prolonged battle with agoraphobia when she started her home-based catering business called The Bag Lady in June 1989, according to her company website.
Then a mother of two teenage boys, Jamie and Bobby, and on the verge of homelessness, she used her last $200 to start the catering business. She describes the business as delivering "lunch-and-love-in-a-bag." Five years later, she opened her first restaurant called The Lady and Sons in Savannah, Ga. Her first cookbook, "The Lady and Sons Savannah Country Cookbook," came out in 1998.