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Scripps Networks Interactive, Inc. (SNI), Smithfield Foods, Inc. (SFD), Novo Nordisk A/S (ADR) (NVO): How Paula Deen’s Mishap May Impact the Market

However you feel about celebrity chef Paula Deen, it’s hard to ignore the impact one person has on the business world. As major brands lined up to pull the plug on deals with Deen, many consumers wondered if it’s already too late. Brands like Wal-Mart Stores, Inc. (NYSE:WMT) and Walgreen Company (NYSE:WAG), which merely carried the chef’s products, will likely be unfazed, but what about those brands that had closer associations?

In the 11 years since Paula’s Home Cooking debuted on Food Network, Deen has amassed a vast collection of deals, including casino-based restaurants, product endorsements, and cookbooks. Many of these companies can walk away, unscathed, but the below companies may find it a little harder to get away from the association.

Food Network cancels Deen

Scripps Networks Interactive, Inc. (NYSE:SNI)

The network that put Paula Deen’s face in households across the country is still closely linked to the star. Upon hearing the news, majority owner Scripps Networks Interactive, Inc. (NYSE:SNI) announced Deen’s show would not be renewed at the end of her contract. The company, which also owns the DIY Network, the Cooking Channel, and the Travel Channel, among others, is doing well in the wake of an earnings report that revealed an 11% increase in earnings from the same quarter a year ago.

Following the cancellation announcement, the company revealed Deen’s popularity had already been waning. Ratings for Paula’s Best Dishes had dropped 15% and viewers between the ages of 18 to 49 had fallen 22%. The Food Network is one of Scripps Networks Interactive, Inc. (NYSE:SNI)’s top earners, making the performance of shows like Deen’s crucial to continued success.

Popular shows from country star Trisha Yearwood and Ree Drummond can help push Deen from people’s minds. Viewer interest seems to be shifting of late anyway, with reality competition shows like Chopped and Food Network Star quickly shifting the network’s general focus.

Smithfield Foods, Inc. (NYSE:SFD) ends partnership

Smithfield Foods, Inc. (NYSE:SFD) aligned itself with Deen in 2006, when the chef began promoting the products through her numerous channels. The company cited its dedication to remaining “ethical” in everything it does as the reason for ending the partnership.

The move was no surprise to those who have watched the company in recent years. A 2009 documentary, Pig Business, called out the company for its controlling stake in the grocery industry, which puts local farms out of business by providing meat at a discounted rate. In 2010, the Humane Society released undercover video of the company mistreating livestock.

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