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Weight Management Update: Opportunities and Challenges

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The global obesity epidemic is a well-publicized public health issue. The World Health Organization (WHO) reports such sobering statistics as overweight and obesity are the fifth leading cause of death worldwide, and over 1.4 billion adults (ages 20 and older) are either overweight or obese. Given the increased awareness of the negative health risks associated with excess body weight, consumer health companies may see great potential in weight management products. While this optimism is logical, there are several factors that could restrain growth in the category.

Globally, weight management sales grew by 3.2% in 2012, but regional growth varied widely.

2012 weight management sales and growth by region

2012 weight management sales and growth by region

Source: Euromonitor International

Indeed, sales actually fell in the US, the world’s leading weight management market with over 30% of global sales. Third largest market Japan also experienced negative growth in 2012. Consumers in both countries are increasingly turning to more “natural” weight loss strategies, such as exercise and healthier diets, while major manufacturing issues for the over-the-counter (OTC) obesity ingredient orlistat further decreased sales in the US. Strong performances in other top countries like China, South Korea, and Mexico, however, helped offset these and other declines. From a global perspective, it is important to note that these five countries account for over 57% of all weight management sales; expanding to the top 10 markets brings this figure to nearly 72%. Thus, while expanding the category into emerging markets has powerful allure for many companies, the reality is that these products do not yet have strong traction in a lot of developing countries, partially because they are prohibitively priced for all but the highest income consumers. Even in countries with more competitive pricing, these items tend to be regarded as more of a self-care luxury, so poor economic conditions can have a strong negative impact on sales.

In addition, wider consumer education on obesity issues presents somewhat of a paradox for weight management products. People recognize the importance of attaining and maintaining a healthy weight, but obesity-related public health campaigns, such as PrevenIMSS in Mexico, typically focus on the benefits of a healthy diet, exercise, and other lifestyle changes, not the short-term quick-fix of weight loss supplements or other weight management offerings.

Negative reports on weight management products further boosts the perception of dietary and fitness changes as healthier alternatives. In the US, for example, the Food and Drug Administration (FDA) issued warnings in November 2012, January 2013, and February 2013 on several different “natural” weight loss supplements tainted with the banned prescription weight loss ingredient sibutramine. A study published online in December 2012 in Biochemical Pharmacology also cautioned about the potential dangers of OTC obesity drugs. Researchers found that orlistat appears to inhibit an enzyme (carboxylesterase 2) that is “responsible for the hydrolysis of many common drugs.” This in turn could reduce the therapeutic effect of these drugs and, the study’s authors speculate, could lead to organ toxicity as well.

Beyond severe health risks, though, weight management items frequently receive bad publicity simply because they do not work as promised. In January 2013 the UK Advertising Standards Authority’s Committee of Advertising Practice (CAP) issued new regulations on weight management product claims and testimonials.  Among other requirements, advertisements cannot claim that users can “lose a precise amount of weight in a set period of time” or “imply that weight loss is permanent or easy,” and they must also provide compelling evidence for health claims. CAP further stated that its policy is to “make an example” of offending products, specifically citing the case of the Boots Carb Control supplement’s “fat binding” claims. This kind of formal public shaming may not even be necessary in all cases. A March 2013 US National Bureau of Economic Research (NBER) working paper found that exposure to deceptive marketing for weight management product is associated with a lower probability that women will actually consumes these items. While the effect was actually the reverse for men, women are overwhelmingly the target demographic for these types of products.

With all of these obstacles to success, as well as others such as higher use of weight loss mobile apps and cultural variations in ideal body types, companies are trying more creative strategies for attracting consumers who are both overweight and increasingly health literate. Dieting support company Weight Watchers has rebranded itself as a “health care company” in an attempt to harness the momentum of general wellness trends. Similarly, Walgreens announced in April 2013 a new initiative called Steps with Balance Rewards within its shopper loyalty program. Participants can earn points for making fitness or wellness goals and linking wireless activity monitors such as pedometers to the program, as well as points for every mile run or walked and every day a user tracks his or her weight. Unilever Group’s Slim Fast, formerly the leading brand in meal replacement slimming and now only the third largest player, sidesteps the health trend entirely.  The brand’s new marketing campaign includes print ads focusing on the sexual benefits of weight loss.

While the Slim Fast approach is provocative, it does not address many of the key complicating factors for weight management products, namely how these items can compete with lifestyle-based treatments. Undoubtedly, certain consumers will always be willing to try something that claims it will allow them to lose weight without making hard dietary and activity adjustments. In the long run, however, companies need to focus on showing consumers how their products support and complement these broader solutions.  Promising the proverbial “miracle cure” is no longer sustainable.

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