How should leadership manage innovation in this industry, and what are Weight Watchers’ options for growth?

Weight Watchers International Inc. had been a major player in the weight-loss industry for over fifty years. The company was known for its lifestyle approach to weight management and its recognizable brand identity. Started by Jean Nidetch in the early 1960s, the company’s original format was to provide group weight-loss support for small groups of women in an intimate setting.

Despite years of success in the weight-loss industry, Weight Watchers was experiencing some challenges and opportunities, including: competitive positioning issues, reinvigorating its brand, broadening the customer mix by targeting new customer segments, and continuing efforts to develop innovative new platforms and product offerings that appealed to a wider range of consumers.

In competition with other weight-loss players, Weight Watchers faced the challenge of maintaining market position and reversing its financial decline: entering 2017 Weight Watchers had had seven straight quarters of declining sales. Although boasting a high gross profit margin, revenue and cash generation – and therefore firm growth – was significantly lower than the industry average. Weight Watchers was in trouble. In January 2014, new CEO Jim Chambers had admitted, “The consumer has changed and we haven’t kept pace…We need to turn this company inside out.” In September 2016 Chambers resigned, and the company was in search of a new CEO.

Intensifying competition in the weight-loss industry coupled with the perception of a “stale” brand image meant Weight Watchers had to reinvent itself. Accordingly, the company was attempting to broaden its health message by expanding to different target groups, different dieting platforms, and different means of offering them. While doing all this, could Weight Watchers still be effective in staying true to the core of Jean Nidetch’s original vision?