Case Study: Weight Watchers

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Question 1

For a company as old as Weight Watchers that is focused on what seems to be the losing battle of obesity in the United States due to the consumption of fast foods, the threat of new entrants from the Five-Forces Model is very real.  Though it was critically acclaimed as the leader in the weight loss industry specifically because of its low cost, grassroots methods, it is those very factors that put Weight Watchers at risk of losing out to new competition.  The internet has made it possible for the cheap and rapid organization of group behavior and philosophy in many areas and weight loss is one of the most obvious as people are continuously searching for a new and better way to address their weight problems.  On the other hand, Weight Watchers has proven itself over the years as a survivor in the industry.  This demonstrates that name value and experience count for a great deal in the long run over any novelty that new entrants might bring.

The threat of substitute products and services is somewhat linked to new entrants, but definitely different in the field of weight loss.  Miracle cures to obesity are advertised constantly and seem to operate in a revolving door, demonstrating that they are fairly insignificant in the long run.  The diet-based weight management industry is by far the longest-lived and most widely used for a number of reasons.  But it must be acknowledged that surgical and pharmaceutical options have persisted and even thrived in a much smaller corner of the weight loss industry.  Price, availability, and willingness are no doubt the primary factors and even as people become more desperate to lose weight, the price and availability of extreme methods keep substitutes for diet-based weight loss difficult to come by.

Question 2

As the obesity rates in the United States continue to rise, the concern for health and fitness does as well.  There are a growing number of programs intended to address this concern and while new ones appear every day, many of the old ones remain.  This sociocultural factor keeps an interest in Weight Watchers alive, ensuring that demand remains for what it offers.  Over the years, Weight Watchers and other diet-industry programs such as the DASH diet have had to adapt to the increasing use of the internet or be left behind.  What used to be email-based and interpersonal has become primarily electronic.  This trend represents the technological segment of the general environment and can be seen in virtually all industries, not just weight management.