Wellful CEO Says Jenny Craig Can Reach Wider Audience as D2C Brand

Rebooted as a direct-to-consumer (D2C) brand, Jenny Craig will now benefit from the widespread expansion of its audience beyond just the locations it can service within reach of brick-and-mortar locations.

Following the weight loss brand’s acquisition and relaunch by Wellful, an omnichannel health and diet food company, Steve Mikulak, president of Wellful’s Nutrisystem brand, which oversees Jenny Craig, explained in an interview with PYMNTS how the transition to D2C will enable Jenny Craig to reach a wider audience.

“It’s been a business that has been restrained by the retail environment where you could only get Jenny Craig if you were within a certain distance of a center. … If you didn’t have a center within 5, 10, 15, 20 miles — whatever you’re comfortable driving — you had to pay a very high shipping fee or there was no option at all,” Mikulak said. “Now, with us, with the ability to ship nationwide, it opens a door. Anyone throughout the continental U.S. can now be part of the Jenny Craig family.”

Overall, there is a relatively small but significant audience for D2C meal delivery, according to the PYMNTS Intelligence study “Connected Dining: Ready-to-Eat Meals Are Eating Restaurants’ Lunch,” which draws from a survey of more than 2,300 U.S. consumers in April. The findings revealed that, of the 57% of consumers who purchase ready-to-eat meals each month, 17% bought their most recent such meal for home delivery. That is, 1 in 10 consumers order ready-to-eat meals to be delivered to their homes.

Additionally, across food categories, the trend toward pushing past proximity loyalty lock-in has been increasingly pronounced. In a feature in advance of Instacart’s initial public offering (IPO), PYMNTS’ Karen Webster observed that the eGrocery marketplace has expanded grocers’ audiences, transforming the competitive landscape.

Looking ahead, Mikulak predicts that consumers will get more and more of their meals delivered to their homes.

“I think general delivery to your door is going to continue to grow. People are consistently looking for convenience, looking for [speed],” he said.

Many consumers are looking to increase their adoption of quick, easy food purchasing options. The PYMNTS Intelligence report “Tracking the Digital Payments Takeover: Catching the Coming eCommerce Wave,” created in collaboration with Amazon Web Services (AWS) and drawing from an April survey of nearly 2,700 U.S. consumers, revealed that 32% of shoppers said they are very or extremely likely to increase their online grocery purchases in the next year.

Instacart observed in a filing leading up to its IPO that online grocery’s growth has been exponential. Specifically, the company stated that in the decade between 2009 and 2019, online grocery penetration increased from 1% of the overall grocery market to 3%, and then, in the following three years to 2022, it quadrupled to 12%.

Yet as eCommerce adoption for food purchasing has grown, so too has the competitive landscape become more crowded, with an increasing number of companies looking to seize on consumers’ demand for convenient meals. As such, Mikulak believes that, just as Wellful acquired Jenny Craig, there will be more consolidation in meal delivery going forward.

“I think there there’s probably an opportunity for some consolidation and some businesses coming together and sharing the data, being able to do more cross sells and upsells,” he said.

“You can’t serve every single customer, but if you partner up and you throw a wider net, I think you’ll start to see that over the coming months, years.”