After decades of emphasizing personal responsibility and behavior change, WeightWatchers is embracing clinical weight loss treatments and cutting back on the face-to-face meetings that once defined the company.
Why it matters: WW, as it’s been known since 2018, is trying to find its footing financially, having lost more than a quarter of a billion dollars in 2022 after a pivot to “wellness” faltered and the pandemic got in the way of attending in person.
Zoom in: The company is scrapping more than 300 in-person meeting locations, or about 29% of its footprint, many in metropolitan areas such as Chicago and Washington, D.C. that were rented on a monthly basis.
- WW members flooded the company’s Facebook account with distressed messages — some threatening to cancel their memberships — after learning their meetings would end or shift to virtual gatherings.
About the same When many members were told their face-to-face meetings were over, the company announced a deal to acquire Sequence, a telehealth platform that offers prescriptions for new popular weight-loss drugs such as Ozempic and Wegovy.
- “It’s finally an acknowledgment that there are biological and genetic underpinnings for obesity — and that in some cases, willpower alone isn’t enough,” WW CEO Sima Sistani told Axios.
The intrigue: Sistani, who joined the company in March 2022, acknowledges that the most dedicated WeightWatchers members may be shocked to hear her say that.
- “But that’s even more reason why it’s important for us to recognize and lead it from a scientific point of view,” she said, adding that the company needs to “provide a clinical pathway to those who need it” and wants to help end the “stigma” surrounding obesity.
review: In 2018, the company made waves by de-emphasizing weight loss and focusing more on healthy living.
- But old members pulled out and the stock is down more than 95% since its peak in 2018.
Be smart: WW’s dwindling membership practically necessitates a shift in focus.
- In 2022, the subscriber base dropped by 15% to 3.55 million, about 80% of whom are digital-only members.
What they say: The company’s decision to refocus on weight loss after its wellness failure “sounds strategically compelling to us,” wrote Morningstar analyst Sean Dunlop. But “management may run out of leverage to compete.”
What to watch out for: Whether the most dedicated WeightWatchers members are going to the exits after the decision to cut more in-person locations, which totaled about 3,300 before the pandemic and will total closer to 800 after the cuts.
- The company will continue to offer face-to-face meetings “when it makes sense” and is planning new “IRL” (in-real life) experiences, Sistani said without giving details.
- “The fixed-rent location doesn’t make much sense for what we do,” she said. “But I’m still a big believer in IRL spaces.”
It comes down to: WeightWatchers believes that the way people approach weight loss is changing – and it can’t afford to be left behind.