Seeing Clearly Now: The Future of the Eyewear Industry

The traditional process for buying glasses includes visiting an optometrist, receiving a new prescription and entering a store where one would proceed to try on various shapes and sizes of glasses and pick a pair that suits them best. Although the process is straightforward, it’s not frequent among individuals who wear glasses. This is largely due to exorbitant price tags that come alongside designer eyewear found in stores like LensCrafters or Pearl Vision. Thanks to the licensing policies of Luxottica, customers pay between CAD$300-500 for a pair of glasses. However, in the last few years, various online retailers have emerged, such as Warby Parker, Clearly, and EyeBuyDirect, that offer affordable, stylish eyewear options. With more consumers turning to the online realm, will the future of the industry turn from brick to click?

Warby Parker's Online Site

                  

First, let’s look at the benefits of buying eyewear online. The biggest advantage, as stated above, is that online retailers are bending the cost curve down. They deploy vertical integration in their business models, meaning they design, manufacture and outfit the glasses themselves. A typical pair of glasses with lenses from Warby Parker retail at CAD$130 and with EyeBuyDirect’s basic lens option, glasses can cost as little as CAD$20. By shopping online, consumers are able to bypass the 20x mark-up that became normalized by Luxottica. Eyewear is a medical market where the majority of users pay out of pocket, which makes consumers price sensitive. Even if an individual has vision coverage, the option for buying discounted glasses online is cheaper than maintaining a coverage plan. Shoppers can frequent online sites for new glasses multiple times per year, something that was previously not accessible for the vast majority of the market.

Promoting Choice with EyeBuyDirect's Affordable Pricing Strategy

Cost aside, there are some drawbacks to purchasing eyewear online. The most obvious disadvantage being the risks that the customer takes on during the buying process. Finding the perfect pair of glasses is a non-standardized process that is dependent on face shape, personal preference and prescription needs. Buying glasses online requires some bravery from the consumer as they are not able to test and try on various pairs before making their final decision. Warby Parker has tried to mitigate this issue by offering a try-at-home program, but this option has yet to land in Canada. Even more risk is added as the customer takes on the role of a trained optical dispenser when making critical decisions about measurements, lens type and material selection.

Warby Parker NYC Showroom

So what’s the future for the eyewear market? The trend is moving towards omni-channel offerings that provide consumers with multi touch-points of accessibility. The once solely e-commerce based Warby Parker now has over twenty physical store locations. Co-founder Neil Blumenthal has stated that physical stores provide the company with another way of bringing customers into the world of Warby Parker. Since 73% of consumers want to try on or touch merchandise before making a purchase (Retail Insider), this strategy is not surprising. Omni-channel offerings, like that implemented by Warby Parker, increase profitability by allowing retailers to serve both traditional and emerging segments while simultaneously increasing their retail footprint. Cost friendly online retailers are not replacing traditional eyewear establishments, but as they expand into the brick and mortar realm they will be giving the retail powerhouses, like Luxottica, a run for their money.

References:

http://www.businessinsider.com/this-startup-wants-to-destroy-a-20-billion-company-that-rips-off-its-customers-2012-12

http://www.weeklystandard.com/a-cost-curve-that-bent-way-down/article/2000802

http://techcrunch.com/2015/04/30/warby-parker-now-worth-1-2-billion-focusing-on-building-more-brick-and-mortar-stores/

http://www.retail-insider.com/retail-insider/2016/2/infographic