Sunday, April 18, 2004
The appeal doesn't appear to be fading any time soon.
WASHINGTON POST
This should be a feeding frenzy for the weight-loss industry. The health consequences of obesity, a national epidemic, are more powerful reasons to shed pounds than fitting into last year's bathing suit ever was. Employers are pushing workers to downsize, and the IRS now allows tax deductions for certain weight-loss expenses.
Yet Weight Watchers, Jenny Craig and Slim-Fast -- the industry's traditional giants -- have been struggling to compete with a low-carbohydrate craze that is proving to be harder to lose than a couch potato's spare tire.
"People walk into our centers and say, 'Gee, my friend Mary lost 15 pounds in two weeks and she was eating bacon and steaks,'" said James Evans, chief executive of Jenny Craig Inc., the privately held California company that offers a low-calorie, nutritionally balanced diet based on its own portion-controlled meals, which cost about $70 a week.
But responding to the low-carb threat can be risky. For years, the three largest weight-loss programs have competed with fad diets precisely by not changing, and being there like an old friend when the fad passed.
Problems with diet
What especially worries the traditional weight-loss industry is the staying power of the low-carb diet. "Unless something comes out from the medical community saying there's something wrong with the Atkins Diet, I don't see any end to it," said John LaRosa, president of Marketdata Enterprises Inc. in Tampa, Fla., an industry research firm.
Many in the medical community have, in fact, said there are problems with the Atkins approach, but enthusiasm for its delivery of quick weight loss has kept "Dr. Atkins' Diet Revolution" in print continuously since 1972.
Slim-Fast
Slim-Fast has been hit hard. The privately held meal-replacement program that was introduced in 1977 built its business around the convenience of drinking a shake rather than eating a meal. But "easy" isn't enough for customers anymore.
According to data collector Information Resources Inc., sales of Slim-Fast's traditional meal-replacement shakes and powders slipped 27 percent last year, to $290 million.
Slim-Fast Foods Co. officials declined to discuss the company's recent financial record. But it has been heavily promoting a new line of shakes and snack bars "for use as part of a low-carb diet."
Jenny Craig
Jenny Craig, meanwhile, still advocates a balanced approach to dieting. A new management team has been making major changes since Sid and Jenny Craig sold the company in 2002. Sales had been flat or declining for much of the past five years, CEO Evans said.
But increased marketing to corporate customers, a home-delivery program called Jenny Direct, the sale of new franchises and the hiring of celebrity spokeswoman Joy Behar helped push sales up last year and in January this year, he said.
Weight Watchers
The publicly traded Weight Watchers International Inc. has been similarly fighting for members, whose fees are its main source of revenue, but with little success, according to recent analyst reports. After strong growth for three years, membership fell 3.1 percent in the fourth quarter of 2003, not counting members gained through franchise acquisitions. Product sales were down 8 percent, and the company's stock has dropped about 18 percent in the past six months.
Weight Watchers countered the low-carb message by relaunching its FlexPoints system last fall, which allows for greater flexibility in the program based on counseling members how to eat a nutritionally balanced, low-calorie diet.
But some medical practitioners continue to believe that low-carb diets are overhyped and that interest in them is bound to wane.
"Atkins has been around for 15 or 20 years in one variety or another," said Arthur Frank, medical director of the Obesity Management Program at George Washington University. "It's just a gimmicky way to change your caloric intake. The only thing that makes a difference is how many calories you consume."
Frank said "you wreak nutritional havoc eventually with a high-fat diet" and predicted a balanced weight-loss approach will come back into vogue.
Atkins officials say, however, that while the overwhelming excitement about low-carb diets may calm down, the diet is here to stay as a lifestyle.
"There are people out there that want you to believe that this is bad for you, and the reason they want you to believe that is because otherwise their economic interests are threatened," said Matt Wiant, chief marketing officer for Atkins Nutritionals. "I think that the hysteria will settle down, and then that low-carb will be a permanent part of the way people eat."