Last week, Wellful, Inc. announced their acquisition of the Jenny Craig brand. In, May, after four decades, the subscription-based Jenny Craig went out of business, cutting 1,000 employees and 500 weight loss and nutrition centers in the US and Canada. In the July 5 announcement, Wellful said Jenny Craig would return this fall utilizing a direct-to-consumer delivery model, offering food and personalized coaching services. The acquisition allows Wellful, who also owns Jenny Craig competitor Nutrisystem, to expand its portfolio. Jenny Craig will be managed as a separate, independent brand under the Wellful umbrella.
“Wellful is acquiring assets of the Jenny Craig business, a move that broadens our healthy weight management portfolio of solutions and further expands our successful ecommerce business,” said Brandon Adcock, CEO of Wellful, Inc.
“Jenny Craig will return this fall and operate as an independent, direct-to-consumer brand, using an ecommerce model,” adds Adcock. “Wellful has the experience to get Jenny Craig back on its feet and product back into the hands of its loyal customers. Today’s consumers simply expect products delivered quickly and easily to their door.”
Before closing, the company said it would transform into an all-online model. An ecommerce model would make them part of the $1.4 billion digital/virtual weight loss market, according to MarketResearch. At that time, they also said they were closing their physical operations and would announce their plans online in the coming weeks. However, the company changed course and decided to shut down altogether.
The company had reportedly been looking for a buyer after struggling to compete against other weight loss programs (e.g., WW International, Nutrisystem), the proliferation of weight loss drugs like Wegovy and Ozempic, and the gravitation by consumers to online weight loss solutions. However, they couldn’t find a buyer or secure other financing, so the Carlsbad, California-based company opted to shutter the business permanently.
In early May, a group of employees filed a lawsuit in federal court in New Jersey, said NBC News. The employees alleged Jenny Craig did not provide the appropriate state and federal WARN notifications that require 60 days’ notice of mass layoffs or clinic closures. It is not clear if Wellful absorbed Jenny Craig’s debt along with its assets.
Previously a subscription-based program
The weight loss and nutrition program was a subscription-based program started in 1983 in Australia before spreading to the U.S. in 1985. It was one of the first programs of its kind. According to Healthline, the average monthly cost of the program was $420 to $840, not including the cost of additional groceries, and a shipping cost between $20 to $30 per shipment. The program included portion-controlled, reduced-calorie, prepared meals and snacks. Those subscribed to the Max Up Weight Loss Plan also received weekly one-on-one health coaching. Other plans included the Simple Meal Plan and the Essential Meal Plan.
How will Jenny Craig change?
In a Q&A that accompanied last week’s announcement, Adcock said that the program would remain largely the same.
“Wellful will allow customers to access all the things that made Jenny Craig successful and that customers love most – the food, the structure, the program, the coaching – and integrate a sustainable business model,” Adcock said.
Based on the CEO’s comments, it sounds like their new acquisition will continue to use the subscription model, but that has not been confirmed. Pricing is not yet known. Customers can follow the JennyCraig.com website for updates and sign up for email updates as the brand gets closer to its relaunch.
Other Wellful brands
Wellful owns a variety of direct-to-consumer and omnichannel health and wellness brands. Brands include the following:
Insider Take
We didn’t see this coming. Jenny Craig reportedly looked for a buyer before shutting down in May. We don’t know if they approached Wellful at any point, or if Wellful was waiting to get a deep discount on the weight loss and nutrition brand. We do know that Nutrisystem made public announcements about the benefits of their service immediately after Jenny Craig’s closure, and they made special offers to Jenny Craig customers hoping to win them over to their side. Regardless, perhaps everyone wins here. Jenny Craig will continue in some form, Jenny Craig customers can return to products and programs they love, and Wellful can continue to be profitable in the name of health and wellness with both brands.
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