The encyclopedia · Advertising & PR · Marketing decision · 2013
Paula Deen's deposition cost her Food Network, Smithfield, Target and half her income
A deposition revealed racial slurs; within a week Food Network, Smithfield, Target and Caesars cut Deen deals, and ~$12.5M of income was gone.
Paula Deen · Food Network · Smithfield Foods · 2013-06-19
What happened
In June 2013 a deposition surfaced in a $1.2 million lawsuit by Lisa Jackson, a former manager at one of Paula Deen's restaurants, against Deen, her brother and their companies (Jackson v. Deen, Case No. CV412-139, U.S. District Court, S.D. Georgia). In it Deen admitted using a racial slur and described wanting Black waiters in period costume at her wedding. NBC News published excerpts on 19 June.
The sponsors moved within days. Target said on 19 June it would not enter new agreements with Deen or extend her branded merchandise. Food Network announced on 21 June that it would not renew her contract, ending 'Paula's Best Dishes'. Smithfield Foods — her spokesperson for seven years — cut ties on 24 June, saying 'our values and those of our spokespeople are properly aligned' is a requirement. Caesars Entertainment ended its relationship with Deen's four restaurants on 26 June, and QVC said it was reviewing its deal.
The income math was brutal. Forbes had ranked Deen the world's fourth-highest-paid chef at $17 million a year in 2012. After the exodus, Forbes estimated she had lost as much as $12.5 million — $7.5 million from merchandising and licensing, $5 million from restaurant and TV deals — leaving an annual take of about $4.5 million.
Why it happened
- A spokesperson is a values statement: one deposition transcript turned the 'Southern cooking queen' brand into a liability no partner could keep defending.
- The departures cascaded because the first mover set the pace: Target, Food Network, Smithfield and Caesars each acted within a week, and every later statement sounded more decisive than the last.
- Deen's empire was one person with no separation: television, restaurants, cookbooks and merchandise all ran through her name, so her words took down every revenue line at once.
The lesson
A brand built on one person cannot survive that person's own words: the same deposition that ended Deen's shows ended her merchandising, her restaurant deals and half her income within a week.
Aftermath
Food Network did not renew Deen's contract, and 'Paula's Best Dishes' ceased production. Smithfield ended a seven-year spokesperson relationship, Target dropped her branded merchandise, and Caesars ended its partnership with Deen's four casino restaurants. QVC reviewed its relationship. Forbes estimated her lost earnings at up to $12.5 million, leaving about $4.5 million a year. The lawsuit by Lisa Jackson continued through the federal courts, and Deen's television comeback attempts never restored her former scale.
Sources
- Food Network won't renew Paula Deen's contract — AP, 21 June 2013
- Paula Deen used the N-word, wanted 'slaves' to serve at wedding, deposition says — NBC News, 19 June 2013
- Paula Deen dropped by Smithfield Foods — TODAY, 24 June 2013
- Target cuts ties with Deen; drugmaker distances — AP, 19 June 2013
- Caesars Entertainment cutting ties with Paula Deen Enterprises — Las Vegas Review-Journal, 26 June 2013
- Paula Deen has lost as much as $12.5 million in earnings over N-word controversy: experts — NY Daily News, 28 June 2013
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