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January 08, 2018

U.S. News

U.S. Weight-Loss Market Worth $66 Billion

Marketdata LLC, an independent market research firm of the U.S. weight-loss industry since 1989, has released “The U.S. Weight Loss & Diet Control Market (14th edition),” its biennial analysis and forecast of all 10 major segments of the U.S. diet market.

“The number of active dieters is estimated to have fallen 10 percent since 2015, to 97 million, due to a growing size acceptance movement and dieter fatigue,” said Research Director John LaRosa. “About 80 percent try to lose weight by themselves, but many fail, and the latest CDC statistics show that we are getting fatter, not thinner.”

Major findings among the 443-page study included:

  • Marketdata estimates that the total U.S. weight-loss market grew just 2.2 percent in 2016, from $64.9 billion to $66.3 billion. The total market is forecast to grow 2.8 percent in 2017.
  • The commercial weight-loss programs segment of the market was worth $2.77 billion in 2016 and is forecast to grow 9.4 percent to $3.03 billion in 2017.
  • Weight Watchers’ rebound has been fueled by signing up more do-it-yourself dieters, coupled with a new CEO and ongoing endorsements from Oprah Winfrey, not by converting customers from competitors.
  • Meal replacements (shakes, nutrition bars) are posting strong growth and are still popular with dieters. Sales of these products will outpace the growth of OTC diet pills to 2022 (7.2 percent per year vs. 4.8 percent). Multi-level marketing companies, such as Herbalife, Shaklee and Isagenix provide a significant distribution channel for these products, since they are safe, portable, easily accessible via retailers and inexpensive.
  • Medical weight-loss clinics and franchises have grown in number as doctors seek to replace income lost to managed care. However, many doctors and hospitals are still taking a wait-and-see attitude, trying to make sense of an uncertain healthcare environment and Affordable Care Act repeal efforts.
  • Low-calorie (diet) frozen entrée sales have been declining for years, as consumers avoid highly processed foods with artificial ingredients. However, producers such as Stouffer’s (Lean Cuisine) have turned declines into growth via new items, more natural ingredients and attractive packaging.
  • Contrary to popular belief, free diet apps such as MyFitnessPal were not the main reason for recent diet company woes. Usage is waning, and research shows that they don’t produce lasting weight loss. Rather, the problem has been a lack of compelling programs and management/structural problems at some companies.
  • Online dieting is worth an estimated $990 million, and is the leader with 2016 revenue of $349 million.
  • American diet companies will seek to boost revenues by looking at untapped or under-served markets and niches, such as the men’s market, teen market, African-American and Hispanic markets, the diabetic market, the elderly market, the worksite-based B2B market and overseas markets.

“Today’s dieters are focused on ‘clean eating,’ convenience and results,” said LaRosa. “They want simple plans and an affordable price, with no side effects, and peer support platforms. Companies and products with these attributes will do well.”