By Barry Janoff
December 16, 2016: If GNC was an NFL franchise, it likely would be this year’s Cleveland Browns, winless through the majority of the season and no hope for the playoffs, but with a core of loyal fans and management looking for ways to rebuild for the future.
Vitamin and supplements company GNC Holdings said it would close all of its corporate stores on Dec. 28 and reopen on Dec. 29, "providing customers a dramatically improved experience with the launch of One New GNC."
The move follows a challenging year for GNC, including replacing its CEO; being fined $2.25 million this month by the Dept. of Justice regarding the selling of illegal dietary supplements; and Q3 revenue of $628 million, down more than 8% from the same quarter last year and some $23 million below the average estimate anticipated by analysts.
To reboot the brand’s image, the company said it would bring a new retail footprint to customers.
The One New GNC will include a single price both in store and on GNC.com to replace multiple pricing structures across channels and membership levels; a new loyalty program, My GNC Rewards, designed to "give consumers an easy-to-use incentive to shop GNC"; and new POS terminals, rolling out across the chain, intended to “speed the checkout process, help guide customer decisions based on purchase history and manage loyalty programs.”
The big move will get a big stage when GNC rolls out a spot in the first quarter of Super Bowl LI Feb. 5 on Fox.
Details of the creative were not shared, but GNC said it would be part of a larger effort to "bring the One New GNC to the public,” also including Internet, social media (#ONEnewGNC), POP and, in conjunction with My GNC Rewards, a new GNC mobile app (available on or before Dec. 28) in the iTunes app and Google Play stores.
GNC said it expects the campaign to receive more than half a billion impressions in the first few weeks alone.
Super Bowl spots on Fox are going for upward of $5 million for 30 seconds, according to industry analysts.
GNC’s lead agency is Bullish, NY.
"We're making these investments because we believe in this business, its future and our ability to return to growth and deliver shareholder value," Robert Moran, interim CEO for GNC, said in a statement. "The New GNC leaves the old, broken model behind. We're confident it will have a positive impact on the business, but it will take time for the changes to take hold and translate to improved financial results."
Moran, who was an independent director of GNC and former chairman and CEO for PetSmart, replaced Michael Archbold as GNC’s CEO in July when Archibald left the ompany and resigned from the GNC Board.
According to Moran, GNC is "also building on its strength in innovation, introducing new brands and new products throughout the coming year" and making changes to its supply chain to help ensure the products customers want are in stock.
The One New GNC will launch in all 4,464 U.S. owned and franchised locations on Dec. 29, "just as consumers are resolving to get fit and stay well."
GNC paid the settlement with the DOJ but admitted no wrong-doing and stressed that the products in question "were removed from GNC's shelves years ago."
According to a joint statement, the DOJ and Food and Drug Administration, "Under the agreement, GNC will take a number of actions to broaden industry-wide knowledge of prohibited ingredients and improve compliance by vendors of third party products. These actions are in keeping with the leadership role GNC has always taken in setting industry quality and compliance standards. GNC remains committed to maintaining robust compliance policies and procedures and holding third party vendors and suppliers accountable for those standards.
According to GNC, its 4,464 U.S. owned and franchised locations will celebrate the One New GNC throughout the month of January with a 1 Million Point Giveaway contest and sampling and giveaways each Saturday during the month.