In France, Tupperware Finds a MarketBy
Before Ouahiba Hamanache helped a friend host a Tupperware party five years ago, she never thought much about a brand long associated with stacking bowls and tumblers. But with a product line that increasingly emphasized high-quality cookware over storage, the mother of two figured there was money to be made in plastic. Hamanache, now 34, soon quit her job as a public school teacher in the eastern French city of Nancy to sell Tupperware full-time. Now a regional manager of 480 sellers, or "culinary advisers," Hamanache says her team held 7,000 parties last year, each of which averaged about €510, or $757, in sales. Her top seller: a $147 Microvapor that steams foods in a microwave.
When Tupperware Brands (TUP) posted record first-quarter profit of $56 million on $636 million in sales, few were surprised that emerging markets made up 57 percent of the Orlando-based company's revenue. Like Amway, Avon (AVP), and many other direct sellers, Tupperware is popular in fast-growing countries that sometimes lack adequate retail infrastructure or income opportunities for women. What's raising eyebrows is the brand's strength in otherwise sluggish economies like France, where sales grew 17 percent last quarter.
The Gallic resurgence owes much to Tupperware's worldwide efforts to revamp a musty brand. Its homemaker-helper image hadn't changed much since Earl Tupper first came out with polyethylene containers with airtight seals in 1946. Over the past five years, however, the company has attracted younger consumers globally with more sophisticated products like a $550 set of knives, "girls' night out" parties, and what Chief Executive Officer Rick Goings calls a focus on sellers as "dynamic entrepreneurs instead of housewives seeking pin money." In France, he adds, they put posters on park benches showing women who "almost looked like punk rockers using Tupperware."
One factor driving sales in France is Denis Gruet, a Frenchman who went to work at Tupperware as a teen in 1973 and rose to become country manager in 2004. Gruet helped turn the parties into workshops aimed at teaching women to prepare simple, fast meals. "We changed the parties to cooking lessons," says Gruet. "Sellers who used to be demonstrators are now like culinary advisers." It helped, of course, that cooking shows were becoming popular on French TV while consumers were starting to show more interest in making healthier meals at home. "The French had always loved good meals, but women who were 25 to 45 were not properly trained to cook," he says. Popular items in France now range from madeleine molds and croissant makers to herb choppers and the microwave steamer. Sellers were encouraged to hold more parties on weekends and evenings, making it easier for working women to attend. All of that helped the number of parties in France grow by 50 percent over the past decade, to about 520,000 a year, says Gruet, while sales have almost doubled. He doesn't think that the French might max out on their appetite for Tupperware at some point, noting "we contact only one house out of four in France every year."
These days, a party typically begins in the kitchen where the seller enlists guests' help in preparing three recipes that generally include an appetizer, main course, and dessert, says Annick Meyer, a 52-year-old seller who lives near the German border in the Alsace town of Geispolsheim. In the past, she says, the food was prepared beforehand and guests would just look. "Now, it's hands-on. People really participate." After the dishes are made, everyone heads to the living room for food, drink, and a display of Tupperware products.
While Tupperware's updated strategy led to similar sales gains in the U.S. last quarter, differences remain. For one, Goings says, "Americans are used to buying cheap, throwaway items." As a result, costlier products such as a line of heat-resistant cookware for conventional and microwave ovens didn't do well in the U.S. It's different for French consumers like Anne-laure Guéné, a Paris-based translator. She's willing to pay for high-quality modern plasticware, explaining "the look is fun, very colorful, and it makes you feel like cooking."
The bottom line: Tupperware's rebranding and growing army of commission sellers boosted French revenues by 17 percent last quarter.