Nutrisystem 2015 Annual Report Download - page 8

PART I
ITEM 1. BUSINESS
Overview
Nutrisystem, Inc. (together with its consolidated subsidiaries, “Nutrisystem,” the “Company,” “we,” “us,” or
“our”) is a provider of weight management products and services, including nutritionally balanced weight loss
programs, multi-day kits available at select retail locations and digital tools to support weight loss. Typically, our
program customers purchase monthly food packages containing a four-week meal plan consisting of breakfasts,
lunches, dinners and snacks and flex meal plan recipes, which they supplement with fresh fruits, vegetables and
dairy. Most of our customers order on an auto-delivery basis (“Auto-Delivery”), which means we send a four-
week meal plan on an ongoing basis until notified of a customer’s cancellation. Monthly notifications are also
sent to remind customers to update order preferences. We offer our pre-selected favorites food pack or
personalized plans where customers can hand pick their entire menu or customize plans to their dietary
preference. Our meal plans feature more than 150 menu options at different price points including frozen and
ready-to-go entrees, snacks and shakes. Additionally, we offer comprehensive individualized counseling options
from trained weight loss counselors, registered dietitians and certified diabetes educators and provide further
support through our digital tools.
Our program is based on the following cornerstones that represent who we are to our customers:
•Real Results. The Nutrisystem program has helped millions of people lose weight successfully over
our 40-plus year history. Our program is portioned for weight loss, nutritionally balanced and
consistent with national guidelines for dietary intake meeting targets for total fat, saturated fat, trans
fat, sodium, added sugar, cholesterol, carbohydrates, fiber and protein as well as national guidelines for
physical activity. We also offer transition and maintenance plans, which include personalized menu
options (e.g., only dinner entrees) as well as continued counseling support and access to NuMi by
Nutrisystem. NuMi is an easy-to-use, interactive and personalized solution to the nutritional and
emotional components of a weight loss journey, giving users the help they need, when and where they
need it most. This digital product integrates with wearable fitness devices and health platforms and is
available for free to Nutrisystem customers as well as the general population of do-it-yourself dieters.
These plans are designed to help our customers keep the weight off.
•Sound Science. The Nutrisystem program is based on more than 40 years of nutrition research and the
science of the low Glycemic Index, and offers portion-controlled items that include relatively higher
amounts of fiber and contain “good” carbohydrates and zero trans fats. The Glycemic Index is a
measure of the quality of carbohydrates in foods. Foods on the lower end of the Glycemic Index are
generally considered “good” carbohydrates. In addition, in 2015, we continued to offer customers more
meal choices, including more than 100 foods that contain no artificial preservatives, colors or flavors.
•Complete Convenience.Nutrisystem sells its weight management program primarily through a direct-
to-consumer sales and distribution approach using the Internet and telephone. Our customers can place
orders 24 hours a day, seven days a week on our website, www.nutrisystem.com, and the food is
shipped directly to our customers’ doors. Our customers can either choose our pre-selected favorites
food pack or personalize their monthly food orders for their specific tastes or dietary needs. Our
program does not require customers to visit centers, measure foods or count calories. The entrees are
individually packaged and food preparation time is minimal. The direct-to-consumer approach using
the Internet and telephone provides the convenience and privacy that our customers value. In addition,
we provide online and telephone counseling and support to our customers using trained weight loss
counselors, registered dietitians, certified diabetes educators and other nutrition and dietary staff, and
as a result, our customers do not need to travel for face-to-face meetings.
•Value.We believe we are very competitively priced within the weight management industry and
provide a compelling value proposition to our customers, which includes a selection of more than
150 food items, expert guides, tools, including NuMi and access to trained weight loss counselors,
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