BUST: Walk-In Weight Loss Jenny Craig Trims Down (and Disappears?)

Jenny Craig once had more than 600 locations and nearly $500M in revenue. But, like many industries, digital communications have been part of its downfall. The company announced this week that, after 40 years,  they are shuttering all their locations. What are the factors that precipitated the massive change?

• New solutions for weight loss are rapidly emerging. The media has been flooded with stories about “miracle drugs” like Ozempic and Wegovy. We live in an impatient world, and many consumers ask themselves, “Why commit to a healthy diet and exercise if a simple pill can help?”
• Online support groups like Noom have replaced the need for in-person meetings. Although the company launched recently (2016), it has already hit $400M in revenue. The pandemic contributed to its massive success.
• Healthy food options and exercise alternatives are on the upswing. Future posts will deal with the rise of the “storefront exercise studio.”

So, what can other companies that have survived four decades learn from the demise of this iconic brick-and-mortar weight loss brand? Here’s the skinny on that topic.

1. This one is pretty obvious. Established companies need to constantly keep an eye on consumer behaviors and trends. As noted above, many people are now comfortable buying services online. Although community is important, it no longer needs to be face-to-face. Companies need to use their data to profile those people who crave in-person services and plan their distribution strategies and targeted marketing accordingly.
2. Speed is critically important to today’s consumer, especially when considering self-improvement. Although losing weight slowly may ultimately be healthier and produce better longer-term results, the “I need it now” mindset of shoppers impacts every aspect of consumer products and services. Weight Watchers (a $1.5B company) seems to have embraced this trend and will offer weight-loss-accelerating drugs and closing some of its physical locations.
3. In today’s “sharing economy” (evidenced by car, home, and office co-op options), owning or renting lots of real estate may have run its course. The SWAS (store-within-a-store) model is on the upswing and should be watched closely.

A whopping 41 percent of Americans consider themselves overweight. The weight loss industry is not likely to vanish overnight, like body fat. But those multi-location companies that are in it need to watch how the consumer is consuming services!

NOTE: Next week, we will be covering a BOOM, a company that has survived and thrived for more than 30 years. All the news is not bleak in the world of multi-location business!