Tupperware Still Parties--But It’s Spreading to Target
Tupperware Corp. said Tuesday that it will begin selling products at Target Corp. stores this fall, the latest move by the billion-dollar plastic container company to expand beyond in-home sales parties.
In recent years, Tupperware also has opened 148 mall kiosks and started selling online and on television.
The two companies said 40 to 50 products will debut this October in 62 SuperTarget stores, which sell groceries along with general merchandise. In the next five years, Tupperware products are expected to be available in 1,000 retail locations, including Target stores and mall kiosks.
Both companies were quick to note that the famed “Tupperware ladies”--now called Tupperware sales consultants--aren’t out of a job. In addition to continuing their in-home parties, Tupperware salespeople will also be in Target stores to help customers.
“This isn’t retail, and it isn’t a Tupperware party. It’s doing a party in a retail environment, where you can demonstrate the products,” said Rick Goings, Tupperware’s chairman and chief executive. “The Tupperware party isn’t dead. This partnership enhances the Tupperware party.”
For Target, among the best performing retailers in the country, Tupperware products build on the company’s mass-with-class image.
The companies declined to detail the financial arrangements of the deal.
Although Orlando, Fla.-based Tupperware and its parties have become a part of consumer Americana, 85% of the company’s sales come from outside the United States. A Tupperware party begins every two seconds somewhere in the world, the company boasts.
Until recently, however, Tupperware sales had been sliding. Moves to bring the company up to date--with weekend rather than daytime parties and award-winning product design--had essentially failed to connect the company with modern women.
Tupperware needed to expand beyond its parties without alienating its core sales force. So when the company began selling on the Internet and via kiosks in 1999, it gave local sales people commissions to set up their own Web sites and staff the mall booths. The salespeople in Target stores also will receive commissions.
The initiative worked, both at winning new customers and at gathering new party invitees.
During the last part of 2000, 51% of the people who attended Tupperware parties were those who had stopped at a mall kiosk, Goings said.
The year after introduction of the kiosks, the company’s sales in the U.S. increased by about $23 million. Analysts said sales are on track to grow this year.
“It was a great move for Tupperware,” said Eric Bosshard, a Tupperware analyst with Midwest Research in Ohio. “It’s a great product, but when was the last time you went to a Tupperware party?”
The mall kiosks also brought the company younger customers, who might have inherited Tupperware from their mothers but had never attended a sales party. In 1993, Tupperware salespeople were on average between 30 and 50 years old, Goings said; the company’s most recent recruits are between 21 and 33.
Moving to retail was inevitable, Bosshard said.
“Management has tried to upscale and modernize the direct-sales method, but this deal puts the products in front of more customers,” Bosshard said. “They will never represent 50% of Target’s plastic storage sales; they’re not going to replace GladWare. But they can garner a piece of the market for sure.”
Goings, who said Target approached Tupperware about the deal, said the stores will not offer reduced prices on Tupperware products. The line will include regularly priced Tupperware storage and food-preparation tools, Goings said. Prices will be $8 to $50.
Target shares fell 23 cents to close at $35.62 on the New York Stock Exchange. Shares in Tupperware closed up 66 cents at $23.16 on the NYSE.
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Sales Slump
In an effort to boost sales, Tupperware will soon sell its products at Target.
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Total revenue in billions of dollars.
2000: $1.07 billion
Source: Company reports
