GNC To Reshape Shoppers’ Experience

Pittsburgh, PA—Michael G. Archbold, the new CEO and director of GNC, says shoppers may soon get a whole new shopping experience in stores.

In the firm’s Q3 investor call, Archbold said GNC has been collecting quantitative and qualitative information from shoppers and “we are now in the process of refining our brand positioning,” noting that changes will be “evolution, not revolutionary.”

Of note, he stated that the company’s inventory is growing faster than sales. With business remaining “soft,” GNC is “dialing back the manufacturing plant to begin to align our inventory with the business.” GNC’s Q3 consolidated revenue fell 2.7% to $656.3 million. Revenue declined in all aspects of its business, including  retail (down 1.4%), franchise (down 3.1%) and manufacturing and wholesale (down 11.4%).

GNC’s customer feedback indicates that its pricing is confusing, says Archbold, and the store is working to address price perception and roll out new price signs. GNC says it is also moving away from a full-store discount model and moving to item-level promotions.

When asked by an investor how he feels about the sports nutrition category, Archbold stated, “We will make sure we continue to take care of that sports and performance customer, while at the same time, figuring out how we can broaden the appeal of the base to include more wellness customers, more women into the customer base.”

Examples of broadening out its customer base, GNC is planning to offer more plant-based and nature-based proteins, increasing its focus on functional foods (such as nut butters and natural sweeteners), and bringing in more women’s products.

Published in WholeFoods Magazine, January 2015 (online 12/11/14)