The Skinny on Atkins Direct’s Growing Business

Fad diets come and go, but the Atkins diet, a low-carbohydrate program founded in 1989 by Dr. Robert Atkins, is still going strong. And Atkins Direct, a catalog of food products and nutritional supplements for followers of the Diet, has seen healthy gains as well.

A division of Ronkonkoma, NY-based Atkins Nutritionals, the Atkins Direct catalog started as a simple price list of products in the mid-1990s. In 1997, it became the Complementary Formulas catalog; a year later, it was renamed Atkins Direct. According to catalog manager Karyn Leto, the catalog accounts for nearly 25% of Atkins Nutritionals’ sales so far this year, up from just 10% last year. She would not disclose revenue figures, however.

Leto credits a more aggressive marketing strategy for the catalog’s increase in sales: “We have a new list broker, and we’re mailing to more prospects.” The catalog targets men and women 30-50 years old who are interested in losing weight or lowering their cholesterol. “We rent names from lists of people who have shown an interest in vitamins and nutrition,” she says.

Circulation increased about 20% for 2001, to 2.5 million catalogs mailed a year, split evenly between prospects and customers. The company plans to boost circulation another 25% next year, primarily by remailing to customers as often as eight times a year, up from four to six times a year.

Growing merch as well as circ

In addition to increasing circulation, Atkins Direct plans to continue growing the catalog’s product selection and page count. The current catalog is 32 pages; the winter edition, slated to mail in January, will have 40 pages. During the past year, Leto says, the company has introduced about 100 products.

“With each catalog we introduce anywhere from 5-30 new products,” Leto says. Whereas the fall catalog featured only about five new items, the January 2002 book will feature around 25. “January is a popular dieting season,” Leto explains. “And some of our vendors want to wait until the post-holiday season to introduce new products.”

The Atkins catalog sells low-carb foods from outside companies as well as products developed by the Atkins Center’s research and development team in conjunction with Dr. Atkins, nutritionists, and other doctors. The proprietary food products account for 30%-35% of the merchandise mix. Including Atkins’s nutritional supplements, however, proprietary products account for about 60% of the catalog’s merchandise. The product line is extensive, ranging from low-carb bread and soy milk to reduced-fat ice cream and beef jerky. Prices range from $2 for an Atkins nutrition bar to $100 for a starter kit, which includes meal plans and the Atkins diet book. The average order is about $100.

Serving up nutrition answers

To provide superior service, the company trains its customer service representatives (CSRs) to answer nutrition-related questions. “The CSRs are trained for three to four weeks before they’re put on the phone,” Leto says. “They learn about the program and its products, as well as information that dispels some of the myths about the program.”

The reps are also instructed to refer any medical questions to doctors at the Atkins center or to advise the caller to speak with his personal doctor. For example, callers with questions about starting the program with a preexisting condition, such as diabetes, or while on medication would be referred to a doctor.

Atkins Direct is looking into an autoshipping system in which every certain number of days or weeks it automatically delivers a standing order, such as a supply of the Atkins nutrition bars, Leto says. Autoshipping programs can help ensure a steady stream of revenue; rather than risk running low on an item, customers can request to be sent — and therefore billed for — a month’s worth of that item every 30 days.

“We’re also exploring our online marketing options,” Leto adds. “We don’t currently have any e-mail campaigns or alternative media programs.”