CHICAGO (AdAge.com) -- Crisis management in the dieting industry usually stems from one of two tactics: fight or flight.
When a celebrity endorser visibly puts on weight, the marketer must decide whether to distance itself from the problem or to be part of the solution, and that's not going to get any easier. Increasing federal scrutiny and updated regulations stand to make diet marketing a lot more complicated and expensive.
Subway has built a low-calorie-eating empire on Jared Fogle's weight loss. Mr. Fogle, the otherwise unlikely celebrity who lost 245 pounds by crafting a diet of low-fat subs, has been the chain's loyal endorser for a decade. But when an unflattering paparazzi photo surfaced in December, Mr. Fogle told his Subway handlers that he'd gained 40 pounds.
"We aspire to be a pretty open brand and we try not to hide things," said Tony Pace, CMO of Subway's Franchisee Advertising Fund Trust. "Jared is kind of like the everyman. He has his ups and down, and though he hasn't had crazy ups, this one got a lot of attention."
Upon hearing the news, Mr. Pace said his team didn't go into crisis mode. "We're always looking for new things to do with Jared," he said. The solution was to train the pitchman for the New York City Marathon and give him an impressive cadre of support. Subway is calling in its raft of celebrity-athlete endorsers, among them Michael Phelps and Michael Strahan, to offer tips and do joint appearances. In the meantime, the chain stands to gain from Jared's loss -- again. Talk about making lemons out of lemonade.
There's also the duck-and-run approach. Jenny Craig enjoyed a surge of media attention in 2005 and 2006 when it hired Kirstie Alley as spokeswoman, and celebrity tabloids followed her success. Her backsliding in 2007 seemed to open the door for Valerie Bertinelli, who lost 47 pounds, and has been the marketer's anchor ever since. Jenny Craig, which declined an interview for this story, has hedged its bets somewhat since, with short-term work with Phylicia Rashad and Queen Latifah, and has more recently "Eastwick" actress Sara Rue and "Seinfeld" alum Jason Alexander.
Perhaps learning from competitors, Weight Watchers made much hay of Sarah Ferguson's endorsement in 2000, but has relegated subsequent spokeswomen like Jenny McCarthy to sideline work. "They let the program speak for itself," said Sharon Glass, VP-health and wellness at Catalina Marketing. She added that Weight Watchers, a Catalina client, has instead focused more on aligning grocery products with its "points" system, which guides consumers in their daily food intake. Besides, she said, spokesmen and women are only influential in getting consumers to try a program. The only thing that keeps them loyal is if it works.
According to a study from Catalina (which is, of course, an in-store marketer), nutrition labels, coupons and store circulars have the most influence on what diet foods consumers pick up at the grocery store. The least influential tactics: websites, magazine and TV ads -- with or without celebrities. Of those surveyed, 44% said nutrition labels had a strong influence over purchase decisions, while only 6% said that TV ads did.
Making celebrity ads though, might be getting more complicated. Claudia Lewis-Eng, a partner with Venable in Washington, said that FTC regulations updated last fall up the ante on earlier mandates. Now all paid spokespeople will have to be identified as such, and the "results not typical" boilerplate will have to be promoted from the fine print. Diet programs must now specifically state how much the average person can expect to lose on a given program.
These and other mandates are likely to upend the way testimonials are done, Ms. Lewis-Eng said, which could be a major blow to sales. "It's my understanding that the testimonial is what sells the product," she said. "And I think that's why the FTC has taken such a hard stance. This is what sells the product so you want to make sure they stand up."
Ms. Lewis-Eng said marketers may only employ models who use the product regularly and that's going to be difficult to monitor. But deviance from the new guidelines will be risky. In tandem with the guidelines, the FTC announced that it was beginning an investigation of several diet companies' marketing practices. Results were expected to be public, along with the companies' names, sometime after the first of the year. Ms. Lewis-Eng said to expect a lot of zeros.
"FTC has been exacting larger and larger fines from these companies over the last five years," she said. "Some companies have paid the agency millions and millions of dollars ... the financial fines wouldn't be small."
And if the FTC doesn't get you, a competitor might. Jenny Craig pulled a campaign claiming its members lost twice as much as dieters on the "largest weight-loss program" last week. A New York judge granted Weight Watchers a temporary restraining order prohibiting Jenny Craig's claim, which was built by comparing a 10-year-old Weight Watchers study to a recent Jenny Craig study. In a statement Jenny Craig CEO Patti Larchet admitted no wrongdoing and challenged Weight Watchers to a "head-to-head clinical trial."