At its zenith, Jenny Craig was a weight-loss giant with operations extending far beyond its origins in Australia, but the decade after its 1991 initial public offering was fraught with challenges, including diet supplements promising quick fixes.
In 2001, the company was delisted from the New York Stock Exchange after it failed to maintain the minimum threshold of $50 million in market value. However, after being bought and sold four times until it was acquired by H.I.G. Capital this spring, the company has found its footing.
Under the leadership of CEO Monty Sharma, Jenny Craig reportedly generated about $400 million in revenue last year. Sharma told PRWeek that Jenny Craig saw 25% growth in new customers in 2018, about 80% of whom enrolled in its three-month Rapid Results program.
However, Jenny Craig is again facing disruption, though not from miracle pills and weight-loss drinks from the 1990s and 2000s. Today’s threats come from the digital economy in the form of apps, influencers and new health and wellness brands.
Sharma argued that these challengers cannot replace Jenny Craig’s core promise to provide personal attention to each customer. And this time, he said, the company isn’t running from its roots.
"We’ve focused squarely on being a leader in what we’ve always been: a leader in weight loss with the highest amount of support and delicious meals," Sharma said.
For seven years, Jenny Craig was under the corporate umbrella of Nestlé, which raised eyebrows when it acquired the brand in 2006. Former chairman and CEO Paul Bulcke championed the deal, betting it would boost Nestlé’s health and nutrition category. However, the two were a poor match, Sharma said. Nestlé shed Jenny Craig in 2013 because it was a "perennial underperformer," according to analysts.
After it was acquired by North Castle in 2013, Jenny Craig was combined with Curves International, combining their respective offerings in nutrition planning and strength training. Sharma, the former CEO of Curves, became the head of the combined entity with the mission of correcting past mistakes and doubling down on in-person consultations. North Castle eventually sold Curves in 2018 to Koshidaka Holdings.
"In 2013, that level of attention wasn’t there," Sharma said. "We weren’t making a commitment with you, not across the board. It was more like, ‘What would you like to buy today?’ It was more of a grocery store. We are not a grocery store."
Jenny Craig employs about 1,800 coaches, about 75% to 80% of whom are former clients, Sharma said.
"That’s really important because they can speak to their own journey and the challenges they had, and they can have the right balance of empathy and accountability," Sharma said.
Weight loss is the company’s primary focus because of its tangible benefits and concrete measurements, but Jenny Craig has found that it opens the door to other health opportunities. The company is implementing new sciences into its programs, most notably incorporating science around the circadian rhythm into its Rapid Results meal program, guiding consumers on when to eat according to the daily fluctuations in their metabolic rate.
Jenny Craig said the program can improve sleep, cancer markers and blood pressure.
"When you come to us, you’re going to lose weight, but what else is this all about? It’s about health," Sharma said.
Jenny Craig hires its own coach -- for communications
The brand ran a campaign called Moments last year that was based on the idea that there are specific times when people realize they want to take better care of themselves, such as a wedding or a pregnancy.
Deciding it needed its own one-on-one consultation, Jenny Craig hired Lewis in 2018 for social media work. "We had not done anything on social media until Lewis came aboard," Sharma said. "Our social media was a few polls here and there. So we put a full team together around that."
Jenny Craig eventually extended its relationship with Lewis to include PR, giving it an annual budget of about $1 million, Sharma said.
"What’s important for our business is to get the message out, especially in a crowded industry, about why you’re different," he explained. "The more we can speak to potential people about what we are and how we’re doing it and why you should consider us for better results, the better we’re going to be."
Working with Lewis, Jenny Craig has taken a more prominent role in health discussions. It wants to examine why, despite the range of weight-loss options in the market, health data is getting worse.
"What is it that’s not working for consumers? And how can we appeal to them?" Sharma asked. "The study shows they’re lacking support, and the second part makes it clear that support has to be given in different forms. Some want the one-on-one support [in Jenny Craig centers]; others we have to help them in their homes."
Jenny Craig is also leading the charge against buzzwords, disowning "wellness" as a label.
Sharma said the company’s research shows consumers don’t understand and don’t trust the word. The regular consumer finds it to be a "fuzzy word. I don’t know what it means; everyone’s using it. Every product is good for wellness, but what’s it doing for me?" Sharma said. "If you don’t want to be pinned down, it’s an interesting general marketing word."
Pitching old school health to millennials
Combatting the school of thought that apps will lead the next wave of health services, Jenny Craig is pitching in-person consultations to millennials. Sharma argued that apps alone are ineffective, with high adoption rates and steep falloff after 30 days and noted that his company’s study discovered millennials want more in-person consultations.
"We were surprised," he added. "The conversation these days is millennials aren’t talking to people, they’re operating digitally. That’s not true. They’re also looking for one-on-one support, because they want help and guidance because there’s so much information out there that they’re overwhelmed by the choices they should make."