WeightWatchers 2007 Annual Report Download - page 21

In addition, we have continued a science-based public relations initiative we launched during the winter of
2005 to capitalize on Weight Watchers position as one of only a few clinically proven commercial weight
management programs. This has included an increased investment in third party scientific research, the launch of
a science center on our website and increased efforts to share our consumer and program insights with leaders in
the scientific and medical communities as well as the general public.
Weight Watchers Magazine
In addition to generating revenues from subscription sales and advertising, Weight Watchers Magazine
reinforces the value of our brand and serves as an important marketing tool to both existing and potential
customers. We offer Weight Watchers magazines in all of our major markets.
Entrepreneurial Management
We run our company in a decentralized and entrepreneurial manner that allows us to develop and test new
ideas on a local basis and then implement the most successful ideas across our network. For example, local
managers in the United Kingdom were responsible for developing our POINTS weight management system. In
addition, many of our meeting products were developed locally and then introduced successfully in other
countries. Local managers have strong incentives to adopt and implement the best practices of other regions and
to continue to develop innovative new plans.
While having strong local leadership has always been a cornerstone of our strategy, we have also been
investing in building our global corporate management team. Our management team plays a critical role in
driving and facilitating the global coordination necessary to optimize our international assets and share best
practices across geographies.
Competition
The weight management market includes self-help weight management regimens and other self-help weight
management products and publications such as books, tapes and magazines; commercial weight management
programs; Internet weight management approaches; dietary supplements and meal replacement products; weight
management services administered by doctors, nutritionists and dieticians; surgical procedures; the
pharmaceutical industry; government agencies and non-profit groups that offer weight management services; and
fitness centers.
Competition among commercial weight management programs is largely based on program recognition and
reputation and the effectiveness, safety and price of the program. In the United States, we compete with several
other companies in the commercial weight management industry, although we believe that the businesses are not
comparable. For example, many of these competitors’ businesses are based on the sale of pre-packaged meals
and meal replacements. Our meetings use group support, education and behavior modification to help our
members change their eating habits, in conjunction with flexible food plans that allow members the freedom to
choose what they eat. There are no significant group education-based competitors in any of our major markets,
except in the United Kingdom. Even there, we possessed the largest share of the market.
We believe that food manufacturers that produce meal replacement products are not comparable
competition because these businesses’ meal replacement products do not engender behavior modification through
education in conjunction with a flexible, healthy food plan.
We also compete with various self-help diets, products and publications, such as low-carbohydrate diets,
which gained in popularity and media exposure beginning in 2003.
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