Celebrity chef Paula Deen loses more deals, but book sales soar

LOS ANGELES (Reuters) ― U.S. celebrity chef Paula Deen saw more lucrative deals evaporate despite her renewed apologies for using a racial slur, as retailer Target Corp, drug company Novo Nordisk A/S, Sears, J.C. Penney and Walgreen joined the list of sponsors distancing themselves from the doyenne of Southern cooking.

But in a sign that Deen could make a comeback, her upcoming cookbook “Paula Deen’s New Testament,” which features “lightened up” recipes, shot to the top of the Amazon books best-sellers list on pre-orders for the Oct. 15 release. And her “Southern Cooking Bible” is No. 2 on the list. Experts say not all may be lost for Deen despite the exodus of sponsors and they point to the comeback of another domestic maven, Martha Stewart, who was able to rebuild her career and image after serving jail time for insider trading.

Deen, 66, has been in damage control mode after a deposition surfaced last week in which she admitted to using the “N-word.” She released online apology videos and made a tearful appearance on NBC’s “Today” on Wednesday. For Robert Passikoff, president and founder of Brand Keys Inc, a consumer and brand loyalty consulting firm, Deen’s apology was “too little, too late.” “She came across as very defensive and when you are talking about contrition, the two words don’t really go together,” Passikoff said. 

“While she had reasonable brand values that worked for her sponsors, she’s not the only one available and these days sponsors don’t need to take a chance on folks that self destruct,” he added.

Forbes estimated Deen’s earnings at $17 million in 2011, placing her fourth on its list of highest-earning chefs last year as her privately held company, Paula Deen Enterprises, expanded. The contract with Novo Nordisk, a Danish pharmaceutical company, came in 2012 after she revealed that she had been diagnosed with Type 2 diabetes.

As spokeswoman for the maker of diabetes care and equipment she would earn an estimated$6 million over three years, according to Forbes. The company said in a statement that it had “mutually agreed” with Deen to suspend her partnership with the company “while she takes time to focus her attention where it is needed.”

Fans rally in support

Deen’s merchandising deals, which include cookware, homeware and books, have an estimated value of about $7 million, according to Marshal Cohen, chief industry analyst for market researcher The NPD Group. Cohen also estimated Deen’s food and restaurant branding deals added another $6 million to $7 million to her empire.

Retail giants Wal-Mart Stores Inc, Target and Home Depot Inc all cut ties with Deen within 24 hours of her “Today Show” appearance.

“We have made a decision to phase out the Paula Deen merchandise in our stores as well as on Target.com,” Target spokeswoman Molly Snyder said in a statement. “Once the merchandise is sold out, we will not be replenishing inventory.”

Since last Friday, Deen has also been dropped by pork producer Smithfield Foods Inc and Food Network, owned by Scripps Network Interactive Inc, home of Deen’s cooking shows. Home-shopping network QVC, owned by Liberty Media Corp, has taken a wait-and-see approach with Deen, saying it was putting a ”pause“ on her involvement with the network.

Sears Holdings Corp, which stocks Deen’s products, said on Thursday it was still deciding the future of the partnership. ”Now she’s going to be given an opportunity down the road... to rebuild and retool,“ NPD Group’s Cohen said. ”She may never get (her brand) back to the same level, but there’s enough people who will sympathize with her.“

QVC said in its statement that ”People deserve second chances.“ Some companies that have partnered with Deen have stood behind her, including Landies Candies and Sandridge Food Corp, which said it is ”proud to provide unwavering support for Paula Deen.

“Deen’s comeback may come down to her loyal fans, many of whom have come out in force on social media to voice their support, some threatening in Facebook and Twitter posts to boycott the companies dropping the chef.

”The consumers have a very short memory ... in a few years from now, no one is going to remember what Paula Deen did,“ Cohen said. ”American consumers are very forgiving and very forgetful.“