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Mass Burning on Zoom is the latest sign for Weight Watchers Worry

In the afternoon of May 14, Joanne Patten sat down at her computer in her Houston home and logged in to a Zoom call with her employer, WW International, the company formerly known as Weight Watchers.

She listened as her manager, read from a script, said that she and the other employees on the Zoom call were fired, effective when the three-minute session ended. It was one of the many Zoom conversations that occurred simultaneously across the country, resulting in the dismissal of an unclear number of WW employees.

“I was like, what just happened?” said Patten, 59, who was a part-time employee for nearly 11 years. “I called my territory manager and said, ‘What was that? Are you kidding? So are you going to fire me after all these years? “

“This is supposed to be a thoughtful wellness company,” said Patten, who said she would have preferred to be let off in a one-on-one conversation with her boss. “How they did it, it was just heartless.”

Nick Hotchkin, chief financial officer for WW, declined to say how many employees were fired through the Zoom call; the company had more than 17,000 employees at the end of last year, most of the part-time workers.

“It wasn’t practical for all the conversations to be one-on-one,” Hotchkin said. He added that employees had been encouraged to contact their managers for follow-up after the Zoom meetings.

At the end of April, WW announced plans to cut $ 100 million in costs due to the coronavirus pandemic. The burning and probably permanent closures of some sites are part of those savings, Hotchkin said.

“Even as we begin a phase-opening of some of our sites, we know that our business will continue to be affected by this crisis,” he said. “That was the context in which we decided to restructure our studio operations and make significant changes to our corporate structure and workforce.”

Ms Patton and other employees said that the wellness strategy adopted by the company in recent years had not been embraced by any long-time members who, like millions of people over the years, had signed up to lose weight.

When the pandemic forced personal meetings in the studio to move to Zoom conversations, attendance declined, several former employees said.

“It was cancellation after cancellation after cancellation,” says Nicolle Nordman, 53, who worked for the company for 18 years in a variety of jobs, before being fired over Zoom. “Those of us who work with customer service joked daily,” How could there be anyone left to cancel? “

The company said it had not seen any increase in cancellations. During the first quarter, which ended in March, subscribers to its higher cost studio and app plan fell 5 percent, while subscribers to its cheaper app-only plan rose almost 16 percent.

Before the pandemic hit, about a quarter of the company’s members paid $ 44.95 a month for access to workshops in its 800 branded studios or 2,500 locations such as community centers, religious services, hotels and other spaces. The other subscribers pay $ 20.95 per month for WW’s app. The company had made its digital platforms a priority, and Hotchkin said it accelerated the change.

The program’s scoring system – three for a boneless, skinless chicken breast or 10 for a chocolate frosted monk – gave them a roadmap to follow when eating. Group meetings and weigh-ins provided support and responsibility.

“I believe in the program because it worked for me,” said Jennifer Remedi, a mother of three from La Grange, Ill., Who joined in 2000 and lost 70 pounds in ten months. She then worked part-time for the company for 19 years as a receptionist, or “guide” in WW parlance, in multiple locations, making $ 25 to $ 35 per meeting for the two or three meetings she worked on Saturdays. Members she had seen for years had become friends.

“Working for weight watchers was about community,” said Remedi, 52. “It was a community of support, encouragement and friendship. You helped people achieve their goals and ultimately helped them become healthier and happier. That’s why I stayed there. “

But the company struggled for years as consumers shifted away from diet programs, instead embracing natural foods and health. Competition from free or cheap apps, such as the Under Armor-owned MyFitnessPal, also drew customers away.

Grossman moved quickly to reposition the company as more of a lifestyle and wellness brand. In 2018, Weight Watchers reclassified WW and said that even though it remained a weight management company, it would also strive to be “the world’s partner in wellness.”

In June 2018, WW’s share topped more than $ 101 per share.

Soon group meetings that had been free form and focused on topics such as strategies for eating at Mexican restaurants – just take 14 tortilla chips from the basket, split them into small pieces on a napkin in front of you, and don’t touch the basket again – were replaced by wider themes like stress or exercise. Employees who had once asked members about their vacation or family had to follow scripts strictly.

“Members no longer needed to weigh in, and we went from topics about what to do or how to deal with the real world to these moving, fine, warm and unclear topics that sometimes made me uncomfortable because I’m not a psychologist or a psychiatrist , “Said Lynn Allred, 58, a teacher who worked part-time at Weight Watchers meetings in California for 15 years before being fired over Zoom. She said that attendance at meetings she was working on had dropped.

In the spring of 2019, WW’s share had fallen below $ 20 per share after Grossman said marketing efforts had not been linked to customers by January – WW’s largest subscription month.

“I think there needed to be more weight loss focus,” Grossman said in a conversation with Wall Street analysts in February 2019.

Since then, company executives say, they have been more successful in balancing WW’s wellness push with their weight loss mission in their marketing, noting that the company hit a peak time of five million subscribers at the end of last year.

“When this crisis hit, ironically, we had a strong start to the year,” Hotchkin said. “We had introduced a new program and done a multicity tour with Oprah Winfrey, which had a huge impact on the business.”

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