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- Oprah Winfrey will not seek reelection to the board of WW International, also known as Weight Watchers.
- The announcement sent WW’s stock price down 25% on Thursday morning.
- WW may struggle to recover from this “Oprah effect.”
Oprah gives, Oprah takes away.
The media guru who brought a breath of fresh air to WW International, known as WeightWatchers, has announced that he is stepping down from the company’s board of directors for the first time in nearly a decade.
Winfrey’s resignation, announced in an SEC filing, caused the company’s stock to drop a staggering 25% on Thursday morning.
In the long term, this move could pose serious questions about the 60-year-old diet company’s relevance today.WW used to be of A weight loss standard for many people, especially women. In Ozempic’s day and age, it feels like an outdated operating system.
The “Oprah effect” was a boon for WW.
Winfrey has been something of the king of wellness trends for almost four decades.
The so-called “Oprah effect” was coined by analysts as a name for a noteworthy trend. Almost every product she endorsed on “The Oprah Winfrey Show,” which aired from 1986 until 2011, saw a significant increase in sales almost overnight.
The same was true for WeightWatchers. Winfrey joined him in 2015, buying his 10% stake in the company and signing on as the face of the program. It was amazing timing to get involved. WeightWatchers was losing users and its stock price was falling. Within three years, the company was worth 13 times his. Reporting on Weight Watchers’ newfound value in 2018, The Guardian said it was “perhaps the greatest example of the Oprah effect”.
WW (the company, which was renamed to an acronym in 2018), benefited further after Winfrey revealed to People magazine last year that she used weight loss pills rather than the WW diet to lose weight. Ta.
Although he declined to name the brand, demand for GLP-1 drugs, a popular new class of weight loss drugs, quickly skyrocketed. ZocDoc, a doctor’s booking site, has seen a 30% spike in people trying to make appointments to buy Ozempic or Wegovy (the brand name for the weight loss drug semaglutide), Axios reported. On the same day, WW added a weight loss drug division to its business and acquired Sequence, a service that provides weight loss drugs. Shortly after, WW’s stock price soared 10%, MarketWatch reported.
food culture has changed
Winfrey’s notable influence on the already booming weight loss drug trend cemented a clear change in the world of weight management.
WW has developed a so-called “traffic light” system that categorizes foods and drinks into different colors (red is bad, yellow is OK, green is good) and allows you to systematically reduce calories.
In recent years, companies have been moving away from traditional calorie-reducing diet plans like rats fleeing a sinking ship. Instead, they’re charting a path toward more appealing and reliable prospects that could fit into anyone’s lifestyle, like weight loss pills. Weight loss startups like Noom and even hospitals like Mayo Clinic are following this trajectory, phasing in diet programs that prioritize consumer interest in GLP-1 therapeutics.
At the same time, the general public is becoming more knowledgeable about weight, weight management, and obesity. The concept of “food noise” and the influence of hormonal and genetic factors on weight is now more widely understood. Until recently, obesity was recognized as a problem of lifestyle and will. Doctors told Business Insider that patients now increasingly view it as a medical illness.
In that context, the traditional “just eat less” method feels outdated.
What are the short-term implications of Winfrey leaving WW?
Winfrey’s retirement and transfer of her remaining shares to the Smithsonian’s National Museum of African American History and Culture is certainly a big blow to the company.
Whether positive or negative, it takes a long time to recover from the Oprah effect. In 2016, Oprah announced on WeightWatchers that she had lost 40 pounds. The stock price soared 170% in two days, a rise it has seen in more than a year. Forbes reports that prices have finally returned to normal levels after about 14 months.
In the long term, WW needs to find a new identity
Over time, WW will benefit from becoming a supplier of hard-to-find weight loss drugs. Ozempic, Wegovy, Mounjaro, Zepbound — these drugs are not easily available. GLP-1 weight loss pills are available at medical spas and compounding pharmacies, but as BI previously reported, it’s not the same thing and it’s unclear what ingredients are in these versions.
When it comes to diet and lifestyle, which is WW’s core business, it could potentially cater to people who take weight loss drugs and are looking for new meal plans to maintain their weight loss.
Is that enough? Some market analysts say the fact that WW’s subscribers have increased recently is a reason for optimism for WW investors. Some people are being more cautious. “I’ve been covering WW for about 10 years and I’ve never seen anything like this,” Craig Hulme analyst Alex Fuhrman told CNBC. “It all unfolds in real time.”
The double whammy of Winfrey’s GLP-1 use and withdrawal from Weight Watchers is that eating less and aggressively tallying calories and fat grams is quickly becoming a ghost of diets of yesteryear. This is the latest sign of this. We are not free from the shackles of diet culture. Ozempic’s world carries the same psychological burden as Atkins’s old world. But it is evolving into something new.
WW has not infrequently tried to bend its brand to the changing whims of the wellness industry, receiving varying degrees of backlash. In 2018, the company spent $3 million on Kurbo, a diet app for kids. That same year, as Slate reported at the time, the company added a new tagline: “Health that Works,” without changing the structure of the eating habits it offered consumers.
But in three years, WW went from being profitable to being unprofitable. It’s unclear whether the weight loss drug pharmacy pivot will be the Oprah Effect 2.0 the company needs.
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