GNC Business Model
1. Key Partners
Who are your key partners?
Strategic Alliance: -Jay Glazer (an analyst for Fox Sports, MMA coach and trainer and owner of Los Angeles-based Unbreakable Performance Center) -HH Global -Sports Nutrition Brand: Glaxon -health specialists, fitness nutritionists, dieticians, personal trainers as well as sports medicine doctors Co-opetition: -BPI Sports, a leading Sports Nutritional Supplement Company -Fittonic, which is a Computer Vision AI company specialising in fitness apps Buyer-supplier relationship: -Nutra Manufacturing -Harbin Pharmaceutical Group Joint Venture: -RealEats, a weekly meal subscription service based in Geneva, New York -GHOST® GAMER (esports) -PlantFuel Life Inc. (PlantFuel) which is a premium plant-based nutritional supplement brand -IBM, uses cognitive computing technology -EXER AI, builds motion intelligence software for health professionals
Who are your key suppliers?
-Nutra Manufacturing -Renmintongtai, the pharmacy chain of Harbin Pharmaceutical Group
Which key resources are we acquiring from partners?
-Intellectual Resources: Partnerships -Physical Resources : Harbin Pharmaceutical Group (R&D)
Which key activities do partners perform?
-Platform marketing -Logistics services -Manufacturing -App maintenance and development
2. Key Activities
Our distribution channels?
-drug stores -supermarkets -mass market retailers -manufacturing & wholesale third party channels -domestic & international franchise stores -GNC online stores through its AI fitness app recommendation
What Key Activities do our Value Propositions require?
Platform: -Social Media Marketing -Live well campaign -Partnerships Problem-solving: -Personalized unique customer experience -using the mobile app to advance its multichannel retail support strategy to provide customers access to its health and nutrition-related products -Seven market pilot program to improve reward system -chatbot/assistants, constructive feedback from users for improving the AI fitness coach app Production: -Moved its supply-chain organization to meet customers’ needs (inventory control) -Real time inventory system for AI fitness coach app to prevent recommendation of out of stock products
3. Value Proposition
What value do we deliver to the customer? (Gain Creators)
functional: - wide range of vitamins and supplements - high standard of quality - app; AI mechanism to monitor workouts self-expression: - determinaton - health-conscious emotional: - accomplished - proud
Which one of our customer's problems are we helping to solve? (Customer Pain Points)
- not enough products - suspiciousness of products' quality - untrustworthy companies physically and on online - unable to seek professional help when working out - unsure of doing workouts correctly
What bundles of products and services are we offering to each Customer Segment? (Products & Services)
- health quides - ongoing discounts and promotions - return policy - international shipping - app; workout plan, wide selection of workout videos, 'get to know you' quiz, meal plans & recipes
Which customer needs are we satisfying? (Pain Relievers)
- limited options; huge selection of vitamins and supplements, from health to beauty - unable to shop easily; navigable, easy shopping experience physically and online - worry of suspicious products; trusted marketplace and positive reviews app: - unable to come down to gym for personal trainers; able to workout anywhere, anytime with workout videos - unable to check on oneself when exercising; AI mechanism monitors user whether they are doing the correct forms and helps them accordingly
4. Customer Relationships
What type of relationship does each of our Customer Segments expect us to establish and maintain with them?
- health-conscious customers are always looking for new ways to optimize their well-being and performance
Which ones have we established?
- personalization for their transactional communications (partnered with flexEngage since 2014) - personalized messages so that customers will keep coming back to GNC - send customers individualized offers and provide additional information about the products they might be considering - has been sending individualized mailings to 1 million of its 7 million Gold Card members a month - provide a personalized 8-pages catalog based on previous buying habits
How will they build rapport with their customers?
- By asking customers to fill in details related about their fitness goals, GNC is able to recommend supplements pertaining to the customers' fitness goals, allowing a personalized online content - personalized app notifications such reminder to do workout - sample diet plans catered to every individual to maintain customers' loyalty
5. Customer Segments
Type of customer segments
segmented markets
Consumers
- men - women - teenagers - kids - elderly - sporty person - people who want to have better weight management - people who injured but still want to exercise
6. Key Resources
What Key Resources do our Value Propositions require?
1) Physical resources - storage buildings - delivery trucks and vans - machinery equipment - point-of-sale systems - cash registers - receipt printer - barcode scanner - debit/credit card reader online pos: - AliPay - ApplePay - GrabPay - WeChat - Google Pay - Parent company - Harbin Pharmaceutical Group 2)Intellectual Resources - GNC's brands - GNC -GNC Milestones -GNC AMP - GNC Climb - GNC Earth Genius - GNC Herbal Plus GNC Luster & Lum -GNC Natural Brand - GNC PRo-Performance - Partnerships - International Vitamin Corporation (IVC) - GLAXON - customer knowledge - surveys 3) Human Resources 1. people who create the product or service 2. truck drivers who delivers products 3. customer service agents 4. manager who oversee production 5. salesperson 6. human resources employees 6. document handlers 7.administrators 8. marketing and public realations 4) Financial Resources 1. cash 2. tradelines and lines of credit 3. venture capital 4. grants and loans 5. stock options for employees
Our distribution channels?
- drug stores - home stores -supermarkets -mass market retailers
customer relationships?
- Personal assistance relations where they provide customer service through hotline and email - Long-term relationships with the GNC memberships - allows discounts and bonuses to engage with them - Customer reward systems
Revenue Streams
Product Sales: GNC generates revenue from product sales though the company retail stores, domestic and international franchise activities, third party contract manufacturing, e-commerce and corporate partnerships
7. Channels
GNC's channels without app
communication channels:- word of mouth- face-to-face- phone calls- text messages- instant messaging- emails- live chat- social mediadistribution channels:- retailers- wholesalers- distributors- agents- brokers- the internet- sales team- resellers- catalog
AI Fitness Coach; how are we reaching them now?
communication channels: - social media - GNC website - emails - blogs - influencers - mobile ad network - television advertisements distribution channels: - app stores - mobile marketing directories; content, email, social meda
How are Channels integrated?
- horizontal marketing systems - vertical marketing systems - multi channel distribution systems/hybrid marketing system
Which ones work best?
communication channel: advertisments distribution channel: website; offers discounts and promos
Which ones are most cost-efficient?
communication channels: online advertisements in social media; facebook, youtube, instagram
How are we integrating them with customer routines?
distribution channels - located in malls and shopping centres communication channels - advertisements in social media
8. Cost Structure
What are the most important costs inherent in our business model?
- physical resources - marketing - human resources
9. Revenue Streams
For what values are our customers really willing to pay?
- expected additional benefits - pricing of the products and the quality - service provided and the relationship and trust that has been built - information on the health and fitness topics they are interested in - personalized product recommendations - expect some kind of loyalty reward
For what do they currently paying?
- discounts - bonus - birthday month rewards
How would they prefer to pay?
- cashless payments - credit and debit cards - online payment apps (grabpay, alipay etc)
How are they currently paying?
- PayPal - Visa - MasterCard - American Express - UnionPay - GNC Gift Cards - In Singapore includes: - AliPay - ApplePay - GrabPay - WeChat - Google Pay
How much does each Revenue Stream contribute to overall revenues?
- depending on how much products are being sold, determines their amount of revenue - as of 2020, their reported consolidated revenue is $472.6 million in the first quarter of 2020 which is a drop compared to 2019
How will its revenue change ?
With all the current revenue streams being unchanged, a portion of its revenues will come from the app's premium plan where users are paying a monthly subscription for it.
