70 Years of Tupperware
Tupperware is definitely an iconic name that emerged from the global direct selling industry. For one thing, “Tupperware parties” have become synonymous with direct sellers’ product demonstrations made at homes. Secondly, Tupperware has become a generic name for plastic food containers.
This week we will look into how this company was founded and has evolved so far.
Tupperware’s founder Earl Tupper was born in 1907 into a modest farming community in New Hampshire. After studying at a university in Rhode Island, he began a landscaping and nursery business that he named “Tupper Tree Doctors Company”. This went on until his bankruptcy in 1936 amid the Great Depression. He then got a job with the DuPont chemical company.
“Tupperware” branded products were introduced in 1946 in the U.S by Earl Tupper. The products were quite innovative in those days as with these airtight containers, food were to be preserved for longer periods. Contrary to general belief, Earl Tupper’s products first appeared in retail outlets. Despite their breakthrough nature, people did not show much interest to these containers mainly because consumers needed demonstrations to understand them. But Earl Tupper did not have a solution to this until he met a lady named Brownie Wise.
Brownie Wise and Party Selling
After she got divorced from her husband in 1941, Brownie Wise started working as a secretary. After the Second World War, Brownie started selling Stanley Home Products at home party demonstrations to earn some additional income. Stanley Home Products was a direct selling company founded by Frank Stanley Beveridge in 1931. In a short while, she also began promoting Tupperware products at home parties.
Around 1948, Brownie Wise’s extraordinary success in selling Tupperware products through home parties caught Earl Tupper’s attention. He asked Brownie to design Tupperware’s marketing strategy based on her experiences. Tupperware was withdrawn from sale in retail stores in the early 1950s. Brownie Wise then, became the Vice President of the company and ran company’s sales division. Brownie Wise was also the face of Tupperware, representing the brand on television, and newspaper and magazine articles. She was known as being the first woman to make the cover of Businessweek, in 1954, well before Mary Kay, Martha Stewart or Oprah Winfrey. 1954 was a golden year for Tupperware as the number of consultants went up to 20,000 that year.
Brownie Wise, who implemented the party plan method at Tupperware was fired by Earl Tupper in 1958. She owned no stock and left with one year’s salary which was about $30,000. It was said that differences about how to run the company and in management style were the causes of this abrupt end. Soon after that, every reference to her was removed from company literature. It was as if she had never existed. Then, Wise made an unsuccessful attempt to establish her own party-plan company. After that, she largely faded from view and died in 1992 at the age of 79.
Brownie Wise was the one who “designed” the corporate culture of Tupperware’s and by setting a role model, also other party-plan companies’. She was known to especially be keen on incentives, motivational meetings and socializing with successful representatives.
The same year Brownie Wise was fired, Earl Tupper sold his company to the Rexall Drug Company for 16 million dollars, divorced his wife, gave up his U.S. citizenship to avoid taxes and bought himself an island in Central America. In 1983, Earl Tupper died in Costa Rica at the age of 76.
After a decade of success in the U.S., Tupperware expanded into Europe. The first British Tupperware party was held in October 1960. In 1963, the company was present in six European countries. After that came launches in Japan and Australia.
In 1992, Rick Goings joined Tupperware as its President. The company became a publicly held company in 1996, separating from its parent company Premark. Rick Goings became its Chairman and CEO who still holds these two positions.
Relations with the Direct Selling Community
Tupperware, for a long time has been putting a distance between itself and those direct sellers that employ a network marketing model. For example, it doesn’t call itself even a direct sales company, instead Tupperware uses the term “relationship-based selling”.
CEO Rick Goings once said, “Direct selling left us, because the industry became dominate by buying clubs and what looked like pyramid schemes.” He also said in another occasion, “We think MLM is not a sustainable way to do a direct selling business when all you basically are a wholesale buying club. So, no interest at all in going that direction.”
As a result of this strategy, Tupperware is not a member of the Direct Selling Associations in many countries including the U.S. However, it is hard to say Tupperware is consistent in its stand on this issue. In some markets, Tupperware is present with “those companies” in the DSAs. Examples are India, Malaysia, South Africa and Turkey. Moreover, company web site features NaturCare, one of Tupperware brands in South America, as a “network marketing company”. You can download the white paper Tupperware had put together to explain how it differentiated the company from others here.
In Europe, threre are two umbrella associations: One being Seldia (formerly “FEDSA”) and the other Direct Selling Europe. Tupperware is a member of the second one along with AMC, Avon, Jafra and Vorwerk.
Tupperware in the New Millennium
In 2001, Tupperware Brands’ global sales was $1.134 billion. This reached $1.744 billion at the end of 2006.
In December 2005, the company acquired the direct selling businesses of Sara Lee for $557 million in cash. The units were selling beauty and personal care products, primarily in Latin America and Asia, through a sales force of over 900,000 consultants. The brands included Nutrimetics and Fuller. The employees of the acquired businesses, led by Simon Hemus also joined Tupperware. Simon Hemus assumed the position of Group President, International Beauty and Personal Care who was then promoted to COO position after about a year. After this acquisition, Tupperware changed its name to “Tupperware Brands” to mark the expansion in its brand portfolio.
So, the $1.744-billion figure in 2006 includes the brands acquired in December 2005. Excluding their contribution, 2006 sales becomes $1.261 and this represents a quite modest growth (11%) in this five-year period.
Tupperware’s evolution in the following years is summarized below:
Few observations from this picture:
* In the last 10-year period, Tupperware’s sales has increased by 79%.
* Sales growth stopped in 2011.
* The company made losses in 2014 and 2015.
* Active sales force has not been growing at the same pace as the total. The ratio of actives has come down from 40% in 2006 to 26% in 2015.
The company currently sells products under seven brands consisting of Tupperware, which represents food preparation, storage and serving products, and six brands of beauty and personal care lines including Avroy Shlain, BeautiControl, Fuller, NaturCare, Nutrimetics, and Nuvo.
As of end-2015, Asia-Pacific generates 34% of Tupperware’s global volume, Europe generates 26%, Tupperware North America 15%, South America 13%, and Beauty North America (i.e. “BeautiControl” and “Fuller Mexico”) 12%. Tupperware operates in nearly 100 countries, Indonesia being the largest market.