Marketing of Atkins Diet Products in Europe vs. The US

Marketing of Atkins Diet Products in Europe vs. The U.S.

Background on Atkins Diet

(A) Who was Robert Atkins?

Atkins was born in Columbus, in the state of Ohio in the year 1930. After having joined the University of Michigan, he graduated with a Major in Pre-meds, after which Atkins received his Medical Degree in the year 1955 from the Cornell University Medical School. By the year 1959, he had finished his residencies at both Rochester and Columbia Universities, and also at St. Luke's Hospital at New York. Equipped with the experiences gained from the residencies, Dr. Atkins was able to start his private practice at New York City in the year 1960. It was in the year 1963 that he began to conduct a lot of research and also formalize his findings on the subject of 'controlled carbohydrate intake', as based on a series of articles that appeared in the Journal of the American Medical Association. However, it was not until the year 1972 that the very first edition of the revolutionary book, 'Dr. Atkins Diet Revolution' was published, which was followed by Dr. Atkins findings on the effects of the destabilizing effects of Diabetes or Blood Sugar published in the book 'Dr. Atkins' Super Energy Diet' in the year 1977. (From Past to Present)

Owing to the popularity of this book and popular demand for more, Dr. Atkins was able to create certain formulas of nutritional control and regulation for his patients, and this was published in the year 1978. The book, 'Dr. Atkins' Nutritional Breakthrough' that was published in the year 1981 provided his patients with the definition of the various benefits of nutritional therapies. Soon he renamed his private practice 'The Atkins' Center for Complementary Medicine', and in the year 1988 published yet another popular book 'Dr. Atkins' Health Revolution' on nutritional as well as complementary medicine. In 1992, he released his 'Dr. Atkins' New Diet Revolution', and in 1997, published his 'Dr. Atkins' Quick and Easy New Diet Revolution Cookbook' in collaboration with Veronica Atkins. (From Past to Present)

The year 1998 saw the dawn of a new book, the 'Dr. Atkins' Vita Nutrient Solution, Nature's Answer to Drugs', and in 2000, Dr. Atkins published his 'Dr. Atkins' Age-Defying Diet Revolution', and in 2003, the book 'Atkins for Life'. Dr. Atkins met with an unfortunate and untimely death in the year 2003 due to a serious accident. (From Past to Present) Dr. Atkins was a pioneer in complementary medicine and he was primarily responsible for introducing the concept of 'alternative medicine' to his patients, with the integration of conventional medical therapies. (Robert C. Atkins: M.D. 1930 -- 2003) Though Dr. Atkins was a Cardiologist, he was in fact better known for his ground breaking diets that actually helped people to lose the excess weight that they were carrying with the help of a well formulated and scientifically researched plan to shed the weight successfully.

(B) How did he develop his theories?

The diet was based on the controversial idea of the intake of a High protein as well as high fat diet with the reduction in the intake of carbohydrates. What makes this diet safe is the fact that this diet does not comprise of the consumption of high proteins, which other diets insist on, and that may lead to dangerous side effects. Dr. Atkins diet comprises the intake of less carbohydrate, and a higher intake of fats, which are considered to be the main source of energy for the Atkins dieter, in addition to protein, which supposedly provides less than 40% of the daily requirement of the calories needed by a human being to function normally. The lesser the intake of carbohydrates, the more the hunger is suppressed, and this automatically leads to a significantly less intake of any type of food, over a period of time. (Dr. Atkins (Nutritionist).

When a person's intake food intake is reduced, then he will definitely shed his excess weight. It is said that Dr. Atkins developed his diet because of the fact that he was obese and he wanted a permanent remedy for reducing his weight and therefore he created his nutritional plan based on his knowledge of medicine, with the collaboration of his wife and others. Though there are dissenters for any idea, this particular diet became almost like an 'epidemic' according to some, and not everyone thought that this was a safe plan, and there were quite a few controversial lawsuits filed against the plan during Dr. Atkins lifetime. (Dr. Atkins (Nutritionist).

(C) What is the Atkins Diet based on?

The Atkins diet is based on a four-phase eating plan that is generally combined with vitamin and mineral supplements as well as a plan for regular and constant exercise. The idea is that this diet would prove to reduce the intake of food in a manner that would increase energy levels of the dieter as well as improve his physical appearance so that he would feel good about himself. Basically, the dieter is allowed to, with intelligence, choose those foods that would be healthy and at the same time would help to cut weight. Once the pattern was established, the person would be able to follow the same plan for many more years, probably throughout his life, thereby keeping away the weight that has been lost. (What is the Atkins Nutritional Approach?)

The Atkins diet is based on the following four principles: the reduction of carbohydrate intake, or 'induction' that in other words means the reduction of grains and fruits and vegetables from the persons diet to a mere 20 grams a day, followed by OWL or 'ongoing weight loss' where carbohydrates are added to the diet in the form of fiber rich foods that contain cellulose and tannin and so on. The first week sees a 25-gram intake and the next week a 30-gram intake and so on until the weight loss stabilizes, after which a 5-gram decrease of carbohydrates in encouraged so that the weight loss is continued and sustained. The next step is the 'pre-maintenance' one wherein the change from weight loss to weight maintenance is encouraged by the increase of the carbohydrate intake at a rate of 10 grams per week so that there may be a steady but slow weight loss at all times. The final step is the 'lifetime maintenance' wherein the weight loss is maintained by controlling carbohydrate intake while weight loss is going on. (What is the Atkins Nutritional Approach?)

What is special about this diet is that unlike all other diets this one is a total nutritional approach to a dietary problem. Nutrient rich and unprocessed foods are to be consumed and the intake of processed foods like breads and pasta and cereals and other high sugar foods that provide unnecessary calories are prohibited. These are to be supplemented by a total spectrum of multivitamin and essential oils. Why this particular diet works so well is because, while most other diets focus on the reduction of fats and this leads to 'hunger' that many people cannot tolerate for a short period of time, leave alone a whole lifetime, the Atkins diet focuses on reducing carbohydrate intake and not calorie intake, and this in itself leads to fulfillment and the satisfaction of a good meal as against hunger experienced with other diets.

Here the dieter is encouraged to eat, but not carbohydrates and this allows them to maintain the weight loss that has been achieved instead of going back rapidly to the original weight by eating normally and therefore regaining the lost weight and endlessly repeating these vicious cycles. Good health is achieved, and the groundwork for a lifetime of freedom from diseases is also laid, and herein lay the innate success of the Dr. Atkins Nutritional Plan. (What is the Atkins Nutritional Approach?)

(D) Controversy Regarding Health

However, it is a fact that the controversies surrounding the Atkins diet are many. One of them is that during the ongoing weight loss plan of carbohydrate intake reduction, or 'ketosis' as it is called, the stores of 'glycogen' in the liver is reduced, and this can be dangerous, as this is the store that the body draws from when it is faced with the need for glucose or energy. The Atkins diet also emphasizes that some people produce excess insulin, 'hyperinsulinism' as it referred to, and this is why they tend to eat more carbohydrates so that it can be stored in the body as 'fat'. The digestion of carbohydrates generally produces insulin. The reduction of carbohydrate intake may lead to 'hypoglycemia' or low blood sugar levels, or even tiredness and fatigue since their bodies are used to the consumption of high quantities of carbohydrates. The metabolic rates of some persons may also become affected, and this may lead to serious health complications. Another topic of controversy is that of the long-term effect of ketosis on the bones of a person due to calcium loss. (Scientific Analysis of Dr. Atkins New Diet Revolution) This is because, according to a recent update on the Atkins diet, of the fact that if there is more protein in a person's diet; he will end up losing more calcium, through his urine. (Is the Atkins Diet bad for your bones?)

II. When was Atkins Introduced into USA

It was in the year 1972 that the first edition of the book, 'Dr. Atkins' Diet Revolution' was introduced. The book 'Dr. Atkins' Super Energy Diet' was introduced in 1977, and these two books together managed to create a revolution of sorts, resulting in a 'low-carb mania' that led millions of Americans on the chase for the elusive formula that had been evading them for the past many years. With these books people found that they were actually losing as much weight as they wanted to lose, and what's more, were able to retain the weight loss. (The Atkins Diet, a Comprehensive Analysis.) In addition, Dr. Atkins brought out a series of recipe books and other dietary products for sale to the Atkins dieter. Some of these were the tablets for the dieter, 'Dr. Atkins Basic 3' and 'Dr. Atkins Dieters Advantage', Dr. Atkins Diet essential Oils, Dr. Atkins Advantage Chocolate Bars, Dr. Atkins Milk Shakes, etc. (Dr. Atkins Diet Center: Dr. Atkins Products)

When the first book was published, it was the time when Americans were recognizing the fact that they as a people were 'fat' and that fat was contained in the saturated fat of both meat and dairy products. Therefore when Dr. Atkins proposed a method that would allow them to continue eating all these fatty foods, they were thrilled, and herein lay the success of the diet plan. All his dietary books became instant bestsellers and remained on that list for an unprecedented length of time. (What if it's all been a Big Fat Lie?) The fact is that the Atkins diets was launched with a lot of fanfare and a lot of people were influenced by the publication of the facts and figures and were impressed into trying it out for themselves. The amount of hype surrounding such diets also served to influence a lot of people into dieting, if not to lose weight, at least for the sake of improving their health, since the Atkins diet was promoted as being good for the health in the long run. (What diet are you on?)

The inherent nature of the marketing strategy that was used managed to change the perception of the people of America. At every nook and corner is an advertisement telling him about the benefits of cutting down on carbs, and the POP or 'point of purchase' advertising served to further influence those who were not yet decided about changing their very lifestyle for the sake of the Atkins Diet. Not even restaurants gave people a rest: they allied with the well-known name of Atkins to advertise low-carb meals, priced higher than ordinary fare. Certain big names like Hershey's and TGIF and Subway offer a high priced low-carb wrap as an ideal takeaway for the dieter. This strategy of aligning with big names in the food business served to promote the name of Atkins even further than it was actually hoped for, and the two initial books stayed about 451 weeks and 57 weeks on Bestseller lists when they were released in 1995 and 2003. (What diet are you on?)

It can be stated that the Atkins Diet is a very user friendly as well as a business friendly proposition that brought about immense profits for the firm. The fact that a Doctor had created it added to its appeal and safety factor, adding to its credibility. The low-carb revolution started by the Atkins Diet influenced other companies to advertise their products as being zero-carb and low-carb, and so on in a manner that was actually making people change their mindset about the various food types that can and cannot be eaten. (What diet are you on?) Dr. Atkins discovered the miracle of ketosis and the fact that this would help tremendously in weight loss by using it himself when he became overweight. This resulted in the publication of his first book wherein he wanted to spread the word to the public in general. Thus the marketing of the book was targeted at obese people who wanted to lose weight and keep it off. (Remembering Dr. Atkins)

When Dr. Atkins met with a group of Doctors and others who believed in alternative medicine, it influenced him into adding the benefits of these therapies into his diet plan, and soon the plan was marketed as an alternative therapy. He went on to write more books; a total of five, and this enabled him to start a one-man company into a virtual empire, which publishes a quarterly magazine meant for dieters, as well as runs a separate company meant for the marketing as well as the sale of all recommended supplementary Atkins products, called 'Atkins Nutritionals'. (Remembering Dr. Atkins) When a person finds that he needs to lose weight and that he wants to keep it off, he can attempt the Atkins diet plan, and buy the products from hundreds of stores all over America. (All Info about Diets and Nutrition)

The marketing methods of the Atkins Diet have in fact changed over time. Whereas earlier it was done by television appearances by famous stars and through magazines, etc., it is now being done through a widespread use of the Internet. The Atkins website that is called the 'www.atkinscenter.com' is used by people who want information on the diet plan as well as those who want to buy any of the recommended products and also to refer to recipes. However, there was a need to promote a better and more interactive site for the purpose of web commerce, and this saw the creation of a total web content management system that customers as well as non-tech savvy Atkins personnel would be able to use with ease. This facilitated the processing of customer's online orders through the use of the Internet. This is the latest method being used by the Atkins team for the purpose of marketing. (Atkins' Nutritional Centers)

III. How is the U.S. Market doing in terms of Sales this Year

The Company, Atkins Nutritionals, Inc. is the provider so information as well as services related to the diet plan of the Atkins diet system. Established in the year 1989 as the Atkins Complementary Formulations, Inc., the company was established to promote the Atkins low carbohydrates diet plan. It remained a solely nutritional supplement firm until the year 1997, when it launched the Atkins Advantage Bar meant for the dieter. After the success that the Bar brought to the company, many more such foods were introduced, like more than 50 food products and more than a hundred types of nutritional supplements. They are sold in more than 30,000 stores all over America, and shops like Wal-mart and Kroger's stock and sell them. The 'direct catalogue business' wherein sales are made through a choice of more than 2oo nutritional supplements offered to the customer by the method of direct mailing was introduced in the mid-1990's. (Atkins Nutritionals)

The products of the Dr. Atkins Diet are well researched and all the benefits as well as harmful effects are underlined so that no single person would enter the diet and suffer in any way as a result. It is the truth that not everyone is a believer of Dr. Atkins method of weight loss and reduction. There have been quite a few criticisms as well as lawsuits filed against the company, and a lot more research has therefore been undertaken so that all the criticisms may be laid to rest and people would actually be able to taste the benefits of the successful carrying out of the Atkins diet plan. For example, researchers have carried out more than sixteen intensive studies in the years from 2000 to 2003 against complaints about the safety of the Atkins diet. One of the researchers was Dr. Eric Westman of the Duke University who was able to prove that those who followed the 'low carb' plan advocated by Dr. Atkins showed a weight loss of twice the amount as compared to those who followed a 'low fat and low calorie' diet plan. Similar research showed similar findings in the case of Dr. Bonnie Brehm of the University of Cincinnati who was conducting the research on behalf of the American Heart Association.

Findings by Dr. Fredrick Samaha reveal that followers of the Atkins diet showed a loss of more than twice the amount lost by followers of other diets, and also that there was not only a five-fold improvement in the triglycerides but there was also an increased sensitivity of dieters, especially women, to Insulin. Many more groups also conducted research and it is only after a thorough perusal of the findings that a dieter is encouraged to start on the diet plan. The research is freely available both on the internet as well as in journals and a prospective customer can read and conduct his own research and afterward try out the Atkins Nutritional Approach - ANA. (November 2003: We stand by the research) Dr. Robert Eckel of the University of Colorado states that it is because of the fact that the Atkins diet goes against all standard beliefs that people find it difficult to accept it. However, it does work at not only losing weight but also in keeping it off. (March 2003: New Research on Atkins diet challenges 30 years of nutritional dogma)

In the newsletter of the 'Progressive Grocer magazine' of the month of October, 2004, New York, it is stated that the Atkins Nutritionals, founded by Dr. Atkins in the year 1989, is actually in the process of laying off its workers, and also that the entire concept of low carbohydrates and therefore weight loss is cooling off and more and more customers have begun to believe that the entire plan is a false and unbelievable one, and its very credibility is being questioned. In addition, the company has hired a tem of crisis managers called 'Alixpartners LLC' to help them with its finances as well as in the area of the management of its supply chain. This is primarily due to the reason that there has been a spurt of low carb products in the last year or so and people are generally confused with the entire range of products available, and this has resulted in an entirely different market than those of a few years before. The restructuring and downsizing efforts are also being carried out in the areas of certain distribution centers that are being demolished in favor of those located elsewhere, like for example, that in Long Island is being relocated to Atlanta and Denver and Chicago. (Progressive grocer Magazine)

The Medical Director of the Atkins' Nutritionals Inc., Dr. Stuart Trager, stated at a meeting of the key stakeholders of the company that the company must be overhauled to accommodate the changing graphic of the government to demonstrate the dynamic relationship between physical activity and the elimination of unwanted carbohydrates from the body in order to sustain the weight loss that has been achieved. Dr. Trager says that the company today must move forward to working with real people and in finding real solutions to real weight problems. This would result in people feeling that they are more in control of their own lives and destinies and this would be of a great help in selling the products of Dr. Atkins diet plan to obese as well as to people who need to shed weight. The fact that the Atkins Nutritional Plan offers each and every individual an individual plan of weight loss based on that persons personal and physical parameters adds to the benefits of the plan and this would also help to popularize it and bring more profits to the company as a result. (Low Carb Energy)

1V. Global Introduction:

A. Focus on European Countries

UK is one of the first countries outside America where Atkins marketed its products. It is considered that more than three million are on some form of Atkins diet. As of now, only some products of the Atkins stable are available in the UK, however, the company claims that it has plans to introduce the entire range of products from the U.S. In the near future.

There are a few Atkins products in other European countries such as France and the Netherlands. However, the general trend so far is that these products are not well received in many European countries. Among the first products introduced are the Atkins morning cereals, 'Ready to Eat Bagels', snacks and lunch and dinner pasta dishes. The Atkins Morning Start Cereal is widely popular and comes in three flavors -- blueberry bounty with almonds, banana nut harvest and crunch almond crisp. With 3 grams net carbohydrate content, 100 Kilocalories and 2.5 grams fat per serving, it looks to be the ideal break fast for those who want to begin the day with minimum carbohydrates. The Ready to Eat Bagels are available in three flavors -- plain, cinnamon and onion. The carbohydrate content is 7-9 grams net and the energy content is 190-200 kcal and 4-4.5 grams fat per badgel. Pasta-based lunch and dinner sides are offered in three varieties -- elbows and cheese, pesto cream and fettucine alfredo, each dish containing 7-8 grams of net carbohydrates.

Marketing and Advertising Strategies

Atkins products are widely advertised in the Europe through popular media and the internet. However, the word-of-mouth is also proving to be an effective advertising option, considering the people's interest in attaining top fitness and staying slim. The products are marketed through a variety of channels. Customers can order the goods directly from the company and the orders will be delivered at their door-step. Atkins is also making efforts to market its products through supermarket chains, retail shops and drug stores. Another key strategy adopted by the company is to make celebrities endorse the diet products and advertise their personal experiences and comments. This has easily taken the message to the masses and has proved to be a good strategy in popularizing the products. Atkins products come in high quality and brightly colored packages, carrying a lot of information on the packages. It appears that the company's strategy is to give a distinct image to its products so that they can be easily identified anywhere.

Atkins has also taken efforts to provide as much information as possible to the public about its products and the scientific logic behind the very concept of the Atkins diet. There are many claims and counter-claims that the Atkins diet can actually produce damaging effects to health and such claims are made with the support of medical professions. On the face of this onslaught, Atkins is making sustained efforts to provide realistic information on its range of products and also sponsored independent research studies on the effect of the Atkins Diet.

Except for Great Britain, all other European countries do not seem to have developed much interest for the low-carbonate products. The comments of Dr. Volker Pudel, Director of Nutrition Psychology and Research at the Unvieristy of Goeettingen in Germany seem to put things in the current perspective. "The Atkins Diet Craze that has gripped America will not result in Germans eating more sausage and less potatoes. German breakfast just does not work without bread and butter." (Europe Snubs Low-Carb Craze) Similar sentiments are echoed in France and Italy. According to Omer Pignatti, spokesperson for Conad, the leading supermarket chains in Italy, there are no low carbohydrate products in the Italian market and he does not see much scope of such products in Italy.

There are many differences between the U.S. And European markets. One of the main reasons cited for the lack of interest in Atkins like products is that the Europeans strongly believe that their diets are very good and balanced. Also, Europeans have the tendency to walk more than the average American which probably gives them more chances to burn calories and hence the lower need for other methods to put off weight. Moreover, Europeans are more traditional and are emotionally attached to their cuisine and it is very difficult to convince them to stop eating their traditional food. There is also wide spread perception that Americans have a much greater problem of obesity compared to the European nations due to their lifestyles and penchant for gobbling fast foods. (Europe Snubs Low-Carb Craze, 2004)

Judging by the current standards, it appears that the launch of Atkins diet products in Europe has proved to be a failure, except in the case of Britain. There is little indication that the company had undertaken comprehensive research before entering the European markets. On the contrary, it has tried to market its products against credible reports expressing grave doubts over the effects of the Atkins diet. For instance, research reports on Atkins are being closely watched in the UK and other parts of Europe. There is a growing perception, supported by research reports, that Atkins diet may have side effects and over a longer time horizon, there is no significant difference between the Atkins Diet and the traditional low-fat diets. In fact, there are reports even suggesting that low-carbohydrate diets could actually harm health and prove to be dangerous (The Atkins Maelstrom -- Low-carb revolution unhealthy and perhaps dangerous)

However, Atkins continues to make efforts to promote its products in the UK. It first launched its new super premium ice cream products in the UK and then launched them in the U.S. And Canada. For the U.S. And Canada operations, Atkins has signed up with CoolBrands International for manufacturing, sales and distribution of these product lines. Atkins could face an uphill challenge in the years to come due to attack from some health specialists. While two documented studies claim that Atkins diet does lead to weight loss, critics point out that even these studies did not cover the hidden indicators in their results. The studies, reported in the New England Journal of Medicine. The first study involved 132 highly obese patients as the sample and they were randomly allotted a low carbohydrate diet or low fact diet for six months. The low carb diet persons were put on a diet that limited the carbohydrate intake to 30 grams a day, while the low-fat dieters were subject to control of calories by limiting the total intake of calorific intake from fat to 30%.

The summary of results indicated that the Atkins dieters lost more weight than the low-fat group and other indicators such as the blood fats were also better. However, a deeper analysis of the study threw up some stark indicators. For instance in the first study, only 79 subjects were able to complete the study, which is a pointer to the fact that people could find it very tough to stick to the diet over a long period. Another major criticism is that the number of samples for the study was too small -- only 63 obese men and women took part in the second study. Also the subjects were severely obese, which is not representative of the average UK dieter. Moreover, the study did not address the possible harmful effect in general and on kidneys in particular. On top of everything, the results revealed that at the end of one year, the weight losses in both forms of diet were not different by a significant level (BUPA News)

It is generally conceded that high protein diets could damage or even lead to permanent loss of kidney function, particularly in those with reduced kidney efficiencies. Heavy meat diets could lead to colon cancer and osteroposis. Due to the uncertainties involved in the Atkins diet system, experts from the British Nutrition Foundation and British Heart Foundation demand that studies on Atkins diet must be conducted over a longer period of five years, before definitive recommendations are made on the diet.

VI. Where is Atkins headed?

Demand from Americans for the Atkins range of products appears to be very strong and the trend is that it will increase further. The USDA has estimated that over 40 million Americans are favoring low carbonate diet to control weight, despite a section of nutritionists and researchers sending out warning signals on the long-term ill effects of Atkins styled diets. In the first quarter of the U.S. witnessed launching of more than 580 low carbohydrate products. This trend augurs well for companies such as Atkins, which are facing the onslaught of criticisms from respectable quarters. KFC, McDonald's, TGIF and Round Table Pizza have all been quick enough to jump at the opportunity provided by the low carbohydrate craze and have developed their own lines of dishes. Such foods are very expensive than the normal products, although common logic suggests that the lack of nutrients should actually lead to lower costs and hence lower prices. Recent market research conducted by the Grocery Manufacturers of America revealed close to three-quarters of the respondents were on some form of low-carbohydrate diet, prompting soft drink majors like Coke and Pepsi to launch low sugar variants of their cola drinks. (Atkins slims down in the face of competition)

The above trend of people in droves moving towards low-carb dietary styles is an encouraging sign for companies like Atkins. But the competition is intense and not all companies may be able to reap the benefits of growing demand. Even front-runner Atkins is having its own troubles related to financial performance and growth in sales. Of late, Atkins has resorted to the widely adopted method of downsizing in an apparent bid to improve its competitiveness. Starting September 2004, the company has initiated the move to cut the number of its staff from the level of 370. It is believed that Atkins has decided to cut strength, based on the market reports that the growth rates in low-carbohydrate products have hit a plateau. Atkins has reportedly hired AlixPartners, a specialist marketing firm to enable it to make a turnaround in performance by improving supply chain efficiencies. (Atkins slims down in the face of competition)

On the American front, the Atkins could face challenges from the medical fraternity. For instance, Dr. Ian Smith of the Men's Health Magazine, has taken a view that low-carb dieters could gain the weight back quicker than compared to other diets. A 1995 study reported that Atkins styled diets can be detrimental to cognitive performance and brain functions after one week of exposure to such diets. Further, low-carb diets for prolonged periods can lead to the risk of heart attacks, despite two medical studies claiming that there is no increase and LDL or other harmful cholesterol levels due. More than anything, the widespread knowledge that Dr. Atkins himself suffered artery blockages that are generally attributed to high-fat, high-cholesterol diets is causing sleepless nights to the marketers of Atkins products. The untimely death of teenager Rachel Huskey, who was reported to be on Atkins diet, has also sparked off negative publicity for this diet. In this case, the body electrolytes were found to be irregular that was cited as the main reason for her demise. (The Atkins Maelstrom -- Low-carb revolution unhealthy and perhaps dangerous)