Tupperware CEO blasts cheap US consumers

Rick Goings blames a 'Wal-Mart market' for his company's problems but ignores its dated domestic image.

By Jason Notte Feb 1, 2013 1:48PM
Image: Woman holding empty purse ( image100/Corbis)When a guy whose entire job involves getting you to buy plastic kitchen storage containers calls you cheap, it just might be true.


As Tom Gara at the Wall Street Journal gleaned from Tupperware (TUP) chief executive Rick Goings' Tuesday earnings call, he's not exactly happy with the buying habits of the average cheese-product-eating, soda-swilling, dollar-store-dwelling American.


In fact, in a quarterly report made available on Seeking Alpha and dominated by the 60% of Tupperware's business from emerging markets in South America and Asia and its growth in European countries like Germany, Goings bluntly explained to Bank of America Merrill Lynch analyst Olivia Tong why his mix of products isn't succeeding in the U.S.:


We are a high-quality product and a brand. Why do we do better in Europe than we do in the U.S.? Hey, take a look at the average brand of cab that you get in the New York cities. I mean, they're filthy, they're junk. Get in a cab over here, it's a Mercedes or an Audi. The U.S.A. is basically a Wal-Mart (WMT) market. Our top-tier products like the Microsteamer or the Ultraplus that are 100-year-old products, hard to sell them in the U.S., because that's a discount market over there.


That most Americans have no idea what the Microsteamer reheatable steamer/colander and Ultra Plus casserole dish lines are bolsters his point a bit. Still, The Huffington Post argues that most Americans aren't springing for $30 steamers they can hand down to the grandkids, because the money just isn't there.


The Social Security Administration puts the median annual wage at $26,965, while the Corporation for Enterprise Development notes that most Americans are one emergency away from financial ruin. Combined with stagnant unemployment numbers and a recent downturn in the gross domestic product, the loss of the payroll tax break has taken a toll on U.S. consumer confidence.


But that's letting U.S. consumers off a bit too easy. As Goings says, "Europe buys quality, Japan buys quality." As the Guardian acknowledges, Japan just fell into a recession, while Europe's austerity measures and bailouts couldn't prevent a double-dip recession there. The U.S. isn't the only nation going through hard times, yet it's the one coping with disposable plastic from the supermarket instead of slightly costlier product that will last far longer.


What that has to do with the brand or reliability of cabs in either market is still anyone's guess, but the greater point about Americans' fear of the up-front cost shouldn't be lost on a country that made Wal-Mart the largest retailer in the nation and No. 2 on the Fortune 500 one cheap plastic resin chair at a time. Just because it's true, however, doesn't make it a great thing to say to potential customers.


Nor does that truth make it Tupperware's only problem in the U.S. market. Sure, its products aren't cheap, but they're also attached to a dated image of mid-century American domesticity that no longer exist. Those Betty Draper-style semi-mute subservient housewives in pearls have faded into suburban history and aren't throwing Tupperware parties anymore. Even Goings admits that one of his "dumb" decisions in the U.S. was "recruiting younger women by giving her products that a 50-plus-year-old woman would like." Maybe American consumers can do better than a $1.99 pack of disposable plastic containers, but why should they buy Tupperware if the product they're being sold doesn't differ much from the sets their parents and grandparents are handing down for free?


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697Comments
Feb 1, 2013 3:10PM
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I would not buy Tupperware before the A Hole CEO opened his mouth. Tupperware is a dated, expensive product that has not evolved. I use another American made product instead, Rubbermade products.

Feb 1, 2013 3:10PM
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I guess Mr. Goings had never heard the expression "The customer is always right".
Feb 1, 2013 3:09PM
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Tupperware is not good quality.     There are much better products at less price in the market.   The reason for the diesel Mercedes cabs is the price of diesel fuel is much less in Europe than gasoline.   I know I rented  diesel station wagon and got about 50mpg.  
Feb 1, 2013 3:09PM
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Hey, jerk - the reason I don't buy your crappy product is because plastic is bad. It soaks up food odors and doesn't retain a good seal. I have Pyrex bowls with lids. Better quality for food storage, you jackass.
Feb 1, 2013 3:02PM
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Having worked in marketing for a few decades I learned that you have to know your market and meet it where it is. Criticizing the market for not being what you want it to be will alienate your potential consumer. Time for this CEO to take a chill pill and stop blaming the market for the CEO's failure.

 

Feb 1, 2013 3:02PM
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tupperware is still sold thru just tupperware parties, right? 

 

if you're not in the stores, guess what!  you don't SELL! 

Feb 1, 2013 3:01PM
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Since my house has lost value and my 401K got trounced and the banksters 'STOLE" over 7 Trillion in housing equity and Goldman Sachs got given 15 billion of taxpayer money with no strings attached then Mr Tupperware can stick it where the sun doesn't shine!  It was a well orchestrated plan by the Elite to take power away the American middle class because money and welth are power in this world.  Now they are going to go after our guns because they know how well armed the American middle class is.  So if they can take the powerful weapons away and leave us with a few pistols then they will have no problem shutting the banks and coming to your door to inform you of what you are to do next.....  Wake up sheeple...It''s happening right befor you eyes so open them.
Feb 1, 2013 2:57PM
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cast iron cook ware the way to go.

Feb 1, 2013 2:56PM
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Insulting the American public in order to increase revenue?  Reverse psychology doesn't really work in marketing.  I think Tupperware's CEO has been sniffing too much plastic.

Feb 1, 2013 2:56PM
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Maybe US consumers would not be so "cheap" if you CEOs actually paid them a livable wage. The buying power of US consumers is directly controlled by CEOs and how much they are willing to pay their employees. Pay more, people buy more, businesses get that money back through revenue.

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Isn't that what innovation is all about? Making something of desirable quality for a lower price. It's capitalism. Tupperware, make your prices better.

Mr. Goings, I'll help you sell your product to Walmart Americans, listen up. You take your line of products and put flames on them. The flames will attract the Wally World shoppers. You could also do a line of "Elvis inspired" wares.

See, thats not so hard is it?

Feb 1, 2013 2:55PM
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so true, people want to spend the least they can and replace it. Its a throw away society, wait until there is no downtown's due to people shopping online. Its pathetic. People don't think anymore they just go into a mindless internet search!
Feb 1, 2013 2:53PM
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I'd like to buy Tupperware but King Barry keeps shaking me down for more coin.  Sorry.

Feb 1, 2013 2:49PM
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It's because of Obamanomics.  The new normal is to spread the misery around so that everyone feels poorer and unable to afford luxuries -- even if it's just Tupperware.  Obama likes to blame his predecessor.  Now his predecessor is himself.  He owns this lousy economy, no ifs ands or buts.
Feb 1, 2013 2:45PM
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This US consumer blasts Tupperware and its greedy CEO

I wouldn't give 15 cents for your cheap overpriced crap. Furthermore, Rick Goings can kiss my A$$.
Feb 1, 2013 2:44PM
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One reason why US employees have little in the way of emergency expenses is that in the EU the social safety net is bigger....their medical expenses are covered and unemployment benefits are better
Feb 1, 2013 2:43PM
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Hey Mr. Goings, why don't you take your crap and sell it in China if you don't like the Amercian consumer. Good riddance.
Feb 1, 2013 2:41PM
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Let's just see what happens to your profits and sales now.  For the cost of one $30 tupperware bowl, I can buy a set of rubbermaid and still have money left over to go the dollar store to buy stuff to store in those bowls.
Feb 1, 2013 2:39PM
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Everyone I know has a Tupperware trap, even if they don't have any Tupperware.  That's the cabinet where all your mismatched plastic containers fall out when you open the door.   Either the lids get lost, the dogs chew the containers, or my relatives make of with both.  It would be crazy to spend Tupperware prices for something that is going to be useless in less than six months.  I try to buy Glad Ware where one lid fits more than one size container.
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