$65 Billion U.S. Weight Loss Market Is In Transition
Growth Slows at Commercial Programs But Ramps up at Medical Chains, Says Marketdata
"The U.S. weight loss market is going retail and medical." – John LaRosa, Research Director
Tampa, FL, April 21, 2015… Marketdata Enterprises is a 36-year old market research firm that has tracked the U.S. weight loss market and published in-depth studies about it and all its market segments since 1989. A new 13th edition of its biennial study entitled: “The U.S. Weight Loss & Diet Control Market” has been released.
“Flat seems to be “the new growth” in the U.S. weight loss market, affected by consumer mega-trends such as the new mantra to “eat clean” and shun highly processed foods and artificial ingredients and preservatives in favor of fresh produce. Dieters are also confused, bombarded with a dizzying variety of weight loss options, tools and claims. Programs have to be compelling to cut through all the apathy.”, according to Research Director, John LaRosa.
Major Report Findings:
Marketdata analysts estimate that the total U.S. weight loss market was worth $64.0 billion in 2014, up 2.3% over the prior year. In 2013, the market’s value actually declined, by 0.8% to $62.56 billion. We project basically the same level of growth this year in 2015, a 2.4% gain to $65.49 billion.
83% of America’s 108 million dieters favor “do-it-yourself” weight loss programs accessed from home online or by phone, via diet books, smartphone apps or celebrity diet plans (fad diets). We expect this rate to remain above 80% in 2015.
Three mega-trends are hurting commercial programs such as Weight Watchers: “clean eating”, the use of free and low-cost diet/fitness apps, and stronger competition from medical programs that are taking advantage of insurance coverage of obesity counseling under Obamacare.
Surprisingly, Herbalife, an MLM company, is now the #2 weight loss company in the World, by sales, with estimated North American sales of weight loss products of $596 million in 2014 (meal replacements), second only to Weight Watchers and larger than both Jenny Craig and NutriSystem.
There is a paradigm shift taking place: with less emphasis on diet products (soft drinks, artificial sweeteners, Rx drugs) and more emphasis on services (counseling, surgery, diet programs, health clubs, etc.). Diet services now account for 52% of the total market’s value, vs. 48% for foods and other products. Weight loss PRODUCT sales fell by 0.1% in 2014, versus a 4.2% increase in SERVICES revenues.
A major development affecting this market was the 2014 implementation of “Obamacare” (The Affordable Care Act). The ACA mandates insurance coverage of obesity screening and counseling in 23 states, for persons with a BMI of 30+. This benefit has to date not been adequately explained and communicated to physicians and the general public, but is a game changer for medical weight loss programs. Consumers can literally pay zero out of pocket versus $1,000-$1,500 for a 3-4 month commercial program. But, counseling can only be by “qualified providers” (MDs, PAs, Nurses, RDs)—personnel that commercial programs mostly don’t use for coaching.
MLM (multi-level marketing) has become a major force in the distribution of weight loss products in the United States, valued at an estimated $2.2 billion. Diet products sold via MLMs represented 8.3% of a total $26 billion in diet product sales, up from just 1.6% in 2001.
Contrary to popular belief, diet and fitness apps for the smartphone are NOT the PRIMARY reason for lower enrollments at the large commercial chains. The thing that dooms diet companies more than anything else is bad management and not serving customers well. This is the case at Weight Watchers, where they have no special programs for: overweight Hispanics, African-Americans, teens, persons with food allergies, pre- and post-menopausal women, diabetics and seniors. Huge potential exists but companies must do the work to create custom plans, and communicate this to prospects. Good counselors are a key asset.
Convenience and price is now crucial. There are 1,900 (and growing) retail drugstore mini-clinics at CVS, Walgreens, Rite Aid now offering weight loss plans. It’s critical for diet companies to reach dieters where they shop, work out, and work, 7 days a week. Mini-clinics have developed their own weight loss programs, some based on the DASH diet (#1 rated diet last four years). This represents new competition for commercial diet companies.
Meal replacements is one of the bright spots—popular because they are safe, easy to private label, and they fit in well with DIY or structured programs. Marketdata estimates that 6.5 million Americans use them. OTC, non-prescription diet pills constituted a $2.05 billion market, compared to a $3.3 billion market for meal replacements, but lately diet pills growth has been faster than meal replacements.
The 2015 “diet season” is shaping up to be a rough one. Factors: lots of winter snowstorms hurt attendance in northern states, the DIY trend, plus complacent dieters, weak disposable income, and a lack of compelling new programs or innovations by most diet companies. “The U.S. weight loss market is moving in two directions: retail and medical. Within retail, MLM is still strong as a distribution method. Within medical programs, growth is taking place via franchising, but the opposite is true for commercial programs, where high overhead makes it tough to operate franchised brick & mortar centers at a profit.”, according to John LaRosa.
About The Study
“The U.S. Weight Loss & Diet Control Market”, 13th Edition, April 2015, is a 435-page multi-client, off-the-shelf market research study. This independent analysis contains 160+ tables/charts and 35 competitor profiles. Price is $1,895, and it is sold by chapters at lower cost. Digital or print formats. ALL 10 market segments are covered in detail, with status reports, 2014 performance, 2015 & 2019 forecasts, and a 15-20 year sales history.
Marketdata Enterprises, Inc., is an independent market research firm and 26-year analyst of the U.S. weight loss market since 1989. The firm publishes many weight loss market studies, performs custom research & consulting, and teleseminars. It also operates a leading, free diet market news website: DietBusinessWatch.com. John LaRosa is available for interviews.
Marketdata Enterprises, Inc., Tampa, FL
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- Contact Information
- John LaRosa
- Research Director
- Marketdata Enterprises, Inc.
- (1) 813-907-9090
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