GNC closed its doors on December 28 to launch the "new GNC" when stores reopened the following day. What did these changes look like?
On December 28, we closed every corporate store in the chain for the day to redo the stores and train our associates about our new way of doing business. On December 29, our Gold Card program went away. Instead of member price and non-member price, we now have one price for everybody. Prices are lower. We now have a free cash-back loyalty program, which we launched that day, and a new app that drives the loyalty program and customer experience. And all through 2017, we’ll have a whole new slate of product innovation.
Can you talk us through GNC’s new business strategy and the desired impact of this change?
We spent two years talking to thousands of customers and doing multiple research studies, all to determine why our business model was broken. [In the third quarter of 2016, total GNC sales were down 8.1%.] What we heard from customers is they think they are paying too much, there is no reward for shopping, and we are the global leader in our space but we aren’t nearly innovative enough with product.
What message are you trying to get out with the ‘new GNC?’
That GNC is a place where everyone wins. There is now one price for everybody, no matter what, no matter who you are, no matter how many times you shop. You can be a customer for 10 years or walk in for the first time. We are going to give everyone a lower price and reward people for their loyalty to our new loyalty program.
What is your comms and marketing strategy? What tactics are you using?
We have huge awareness in the U.S., 82%. So our issue is not building awareness. Our issue is that people have the wrong perception — that we are too high priced, [our stores are] complicated, and our employees are too pushy from a sales standpoint. All that was revamped and fixed. So the most important thing we have to do is tell people there is a new GNC and those days are over.
In terms of tactics, the week after Christmas, we launched the biggest marketing campaign in the company’s history. We used high-profile social media platforms from Instagram Marquee on December 29 and a promoted trend on Twitter on New Year’s Eve, which revolved around GNC New Year’s resolutions. We also promoted our changes on national radio, in full-page newspaper ads, broad digital, and broad out of home. We are going to advertise during the Super Bowl in 2017 for the first time in GNC’s history and the first time in the industry’s history. We haven’t finished the creative concepting. The ad will be in one of the prime spots in the game’s first quarter.
You come from a background in finance. How did you end up in a CMO role?
The first 20 years of my career were in finance. Four years into my job running finance for Dick’s Sporting Goods, I became CMO. It was all driven by how much marketing relies on data and the quantitative nature. What most people see from a marketing standpoint is creative and what the output is. But underlying it, the true success of marketing is understanding data and how to analyze it.
At some point, it was challenging to me to think I’d ever be recommending a Super Bowl commercial from a financial standpoint. We are excited because no matter what we do, people are going to be surprised to see GNC or anybody in our industry in the Super Bowl. We look at the Super Bowl as an investment, not as an ad spend — it will have a return. So I will be able to pull on my financial background and see where that goes.
In December, GNC agreed to pay $2.25 million in a settlement with the Department of Justice after it was accused of selling possibly unlawful dietary supplements. How are you communicating that GNC’s products are safe?
I can’t comment on anything related to the [Justice Department]. But we lead the industry in quality. We have more than 150 safety checks in every product we manufacture. We try to communicate to our customers through our website, email, and other channels about the fact that our products are clinically proven, top quality, safe, and the best products that are out there. We have a 100% satisfaction guarantee. If you buy something that has 30 pills in a bottle and you bring it back with one pill left, we will give you a full refund. All we care about is that our customers are satisfied.
How do you work with influencers?
In the past six years, we have worked with iconic athlete influencers as well as people who have a small but passionate following. We find that the latter is better. What we don’t want is to lack authenticity. We don’t want influencers out there who clearly don’t live the GNC life and don’t understand anything about our products. We are working with influencers around our New GNC campaign.
How many people handle marketing and comms at GNC?
The core marketing team is 80 people.
With which PR agency do you work?
Edelman. They help us with PR and do a lot of content development for us. We started working with them in August.