WeightWatchers 2015 Annual Report Download - page 16

channels of distribution, such as mobile or social media. Our failure to develop new, innovative services and
products and to enhance our existing services and products, the failure of our services and products to continue to
appeal to the market or the failure to expand into appealing new channels of distribution could have an adverse
impact on our ability to attract and retain members and subscribers and thus adversely affect our business,
financial condition or results of operations.
We may not be able to successfully implement new strategic initiatives, which could adversely impact our
business.
We are continuously evaluating changing consumer preferences and the competitive environment of our
industry and seeking out opportunities to improve our performance through the implementation of selected
strategic initiatives, such as our healthcare initiative. The goal of these efforts is to develop and implement a
comprehensive and competitive business strategy which addresses the continuing changes in the weight
management industry environment and our position within the industry. For example, as the healthcare industry
continues to evolve its response to the obesity epidemic so do the requirements, both regulatory and business, for
providers. If we do not successfully meet these requirements, we may not be perceived as an appropriate partner
for certain purposes. We may not be able to successfully implement our strategic initiatives and realize the
intended business opportunities, growth prospects, including new business channels, and competitive advantages.
Our efforts to capitalize on business opportunities may not bring the intended results. Assumptions underlying
expected financial results or consumer demand may not be met or economic conditions may deteriorate. We also
may be unable to attract and retain highly qualified and skilled personnel to implement our strategic initiatives. If
these or other factors limit our ability to successfully execute our strategic initiatives, our business activities,
financial condition or results of operations may be adversely affected.
Our business depends on the effectiveness of our advertising and marketing programs, including the
strength of our social media presence, to attract and retain members and subscribers.
Our business success depends on our ability to attract and retain members to our meetings and subscribers to
our Online products. Our ability to attract and retain members and subscribers depends significantly on the
effectiveness of our advertising and marketing practices. From time to time, we use the success stories of our
members and subscribers, including in some cases celebrities, in our advertising and marketing programs to
communicate on a personal level with consumers. Actions taken by these members, subscribers and celebrities
that harm their personal reputation, or include the cessation of using our services and products, could have an
adverse impact on the advertising and marketing campaigns in which they are featured. We also use social media
channels as a means of communicating with consumers. Unauthorized or inappropriate use of these channels
could result in harmful publicity or negative consumer experience which could have an adverse impact on the
effectiveness of our marketing in these channels. In addition, substantial negative commentary by others on
social media platforms could have an adverse impact on our reputation and ability to attract and retain members
and subscribers. If our advertising and marketing campaigns do not generate a sufficient number of members and
subscribers, our business, financial condition and results of operations will be adversely affected.
The Weight Watchers brand could be impaired due to actions taken by our franchisees, licensees,
suppliers and other partners.
We believe that the Weight Watchers brand, including its widespread recognition and strong reputation in
the market, is one of our most valuable assets and that it provides us with a competitive advantage. Our
franchisees operate their businesses under our brand. In addition, we license the Weight Watchers brand to third
parties for the manufacture and sale in retail stores by such parties of a variety of goods, including food products,
and also endorse third-party branded consumer products. We also sell in our meeting rooms food and non-food
products manufactured by third-party suppliers. Our franchisees, licensees, suppliers and other partners are
independent third parties with their own financial objectives. Actions taken by them, including violations of
generally accepted ethical business practices or breaches of law or contractual obligations, such as not following
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