WeightWatchers 2010 Annual Report Download - page 20

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Our Product Sale
s
We sell a range of products, including bars, snacks, cookbooks, food and restaurant guides with
Po
int
s
Plu
s
values, Weight Watchers magazines an
d
P
o
int
s
Plu
s
calculators, which complement our weight management
p
lans and help our customers in their weight management efforts. We have focused on selling consumables tha
t
d
rive recurring purchases. Our products are designed to be high quality, offer benefits related to the Weigh
t
W
atchers plans, be competitively priced and be easy to merchandise
.
We sell our products primarily through our meeting operations and to our franchisees. We have grown ou
r
p
roduct sales per attendee in our meeting operations by updating our selection of products. In fiscal 2010, sales
o
f our proprietary products represented approximately 18% of our revenues. We intend to continue to optimize
o
ur product offerings by updating existing products, selectively introducing new products and sharing best
p
ractices across geographies
.
Revenues from WWI, including revenues from meetings and product sales, comprised 83.4% of our tota
l
r
evenues in fiscal 2010, 8
5
.9% of our total revenues in fiscal 2009 and 87.7% of our total revenues in fiscal 2008.
O
ur WeightWatchers.com Offering
s
Through WeightWatchers.com, we are well positioned to benefit from the large self-help weight
management market as well as several trends taking place in the global Internet marketplace, including an
increased willingness of consumers to access and pay for web content, the proliferation of broadband access and
the growth of e-Commerce and Internet advertising. According to the U.S. Census Bureau, U.S. retai
l
eCommerce sales as a
p
ercent of total U.S. retail sales more than tri
p
led between the third
q
uarter of 2001 and
the third quarter of 2010. We offer two Internet subscription products—Weight Watchers Online and Weigh
t
W
atchers eTools. We have offered these products in the United States since 2001 and subsequently hav
e
launched them in ten other countries, including the United Kingdom, France, Germany and Australia. While
these products have similar functionality across markets, each is tailored specifically to the local market.
Revenues from WeightWatchers.com contributed 1
6
.
6
% of our total revenues in fiscal 2010, 14.1% of ou
r
total revenues in fiscal 200
9
and 12.3% of our total revenues in fiscal 2008.
Subscri
p
tion Products
Weight Watchers Online is a product based on the Weight Watchers approach to weight management and i
s
d
esigned to attract self-help-inclined consumers. Weight Watchers Online helps consumers adopt a healthie
r
lifestyle, with a view toward long-term behavior modification—a key aspect of the Weight Watchers approach
toward sustainable weight loss. Weight Watchers Online allows consumers to learn how to make healthier food
choices and lead a more active lifestyle by providing them with online content, functionality, resources an
d
interactive web-based weight management plans. As of the end of fiscal 2010, WeightWatchers.com had over
a
million active Weight Watchers Online subscribers
.
Weight Watchers eTools is an Internet weight management product available to consumers who are Weight
W
atchers meetings members. Weight Watchers eTools allows users to interactively manage the day-to-day
aspects of their weight management plans online, discover different food options, stay informed and motivated,
and keep track of their weight management efforts.
A
s Weight Watchers Online and Weight Watchers eTools reflect different value propositions, the
s
ubscription products are priced differently. Both subscription products currently offer an initial pre-pai
d
s
ubscription term of one or three months, continuing thereafter on a pre-paid month-to-month basis unti
l
canceled. In the United States, Weight Watchers Online costs
$
65.00 for the initial 3-month term or
$
47.90 fo
r
the initial one-month term. The ongoing monthly fee for Weight Watchers Online is
$
17.95. In the United States,
4