WeightWatchers 2010 Annual Report Download - page 17

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P
A
RT I
I
tem 1. Bus
i
nes
s
O
verv
i
ew
We are a leading, global-branded consumer company and the world’s leading provider of weigh
t
management services, operating globally through a network of Company-owned and franchise operations. With
o
ver four decades of weight management experience, expertise and know-how, we have established Weight
W
atchers as one of the most recognized and trusted brand names among weight-conscious consumers. In 2010
,
consumers spent over
$
4 billion on Weight Watchers branded products and services, including meeting
s
conducted by us and our franchisees, products sold at meetings, Internet subscription products sold b
y
W
eightWatchers.com, licensed products sold in retail channels and magazine subscriptions and other
p
ublications
.
The high awareness and credibility of our brand among all types of weight-conscious consumers—women
and men, consumers online and offline, the su
pp
ort-inclined and the self-hel
p
-inclined—
p
rovide us with a
significant competitive advantage and growth opportunity. As the number of overweight and obese people
worldwide grows, we believe our global presence and brand awareness uniquely position us to capture an
increasing share of the global weight management market through our core meetings business and our additiona
l
growth vehicles, such as WeightWatchers.com.
I
n the more than 4
5
years since our founding, we have built our meetings business by helping millions o
f
p
eople around the world lose weight through sensible and sustainable food plans, exercise, behavior modificatio
n
and group support. Each week, approximately 1.2 million members attend over 4
5
,000 Weight Watchers
meetings around the world, which are run by more than 12,000 leaders—each of whom has lost weight on our
p
rogram. We are constantly improving our scientifically-based weight management approaches, and we are one
o
f only a few commercial weight management programs whose efficacy has been clinically proven. Our stron
g
brand, together with the effectiveness of our plans, loyal customer base and unparalleled network and
infrastructure, enable us to attract new and returning members efficiently. Our customer acquisition costs are
r
elatively low due to both word of mouth referrals and our efficient mass marketing programs
.
Through WeightWatchers.com, we offer Internet subscription weight management products to consumers
and maintain an interactive presence on the Internet for the Weight Watchers brand. We believe
W
eightWatchers.com is the global leading provider of weight management Internet subscription products.
Currently, we provide two Internet subscription offerings: Weight Watchers Online and Weight Watchers eTools
.
W
eight Watchers Online provides interactive and personalized resources that allow users to follow our weigh
t
management plans via the Internet. Weight Watchers eTools is the Internet weight management companion fo
r
W
eight Watchers meetings members who want to interactively manage the day-to-day aspects of their weight
management plans on the Internet. Weight Watchers eTools is offered for free as part of our Monthly Pas
s
commitment plan, or Monthly Pass, which provides our meetings members with unlimited access to meetings at
a discounted monthly rate. We currently offer our two Internet subscription products in eleven countries,
including the United States, the United Kingdom, Germany and Australia.
Companies show continued interest in licensing our brand and other intellectual property as a platform t
o
build their businesses since the Weight Watchers brand brings high credibility and access to the weight
-
conscious consumer. By partnering with carefully selected companies in categories relevant and helpful to
weight-conscious consumers, we have created a highly profitable licensing business as well as a powerful vehicl
e
to reinforce the Weight Watchers brand in the minds of our target consumers
.
The
G
lobal We
i
ght Management Market
We participate in the global weight management market. According to Marketdata Enterprises, the weight
management industry had revenue of approximately
$
60 billion in 2009 in the United States alone. The numbe
r
1