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A Closer Look at the $13B Premium Eyewear Market

businessoffashion.com

11–20 of 138 posts

Re: A Closer Look at the $13B Premium Eyewear Market

#11
post #2

Europeans seem to wear glasses at a much higher rate than Americans. Is there is structural reason for the preference of glasses over contacts?

Eastern European countries were too poor in the 1990s and early 2000s for contact lenses to really catch on like they apparently did in the USA during that time. You could only order contact lenses from a handful of opticians, and contact lens solution was only sold in a few places in the biggest cities. Only a small wealthy demographic bought them.

People have more money now of course, but the impression remains that contact lens are a luxury, not a necessity. Plus, the big rise in salaries in my city happened precisely at a time when spectacles were suddenly in fashion. Distribution of the lenses and lens cleaning products remains poor, and if you need a prescription for astigmatism, you can expect to wait 1–2 months for the special order.

Re: A Closer Look at the $13B Premium Eyewear Market

#12
post #6

if you’re in to avoiding paying hyper-inflated costs to support entrenched and anticompetitive markets, like what eyeglsses have been for years, I higly recommend Zenni Optical. They have highly customizable options and are great glasses, especially for the price. http://www.zennioptical.com Edit: spelling

My best experience to date for avoiding price-gouging has actually been at Costco's in-house optical.

My experience with Zenni was of the "you get what you pay for" variety.

Re: A Closer Look at the $13B Premium Eyewear Market

#13
post #8

The reason glasses cost so much is because one company owns: (1) nearly all brand name frames including Ray-Ban, Oakley, Prada eyewear, Armani eyewear and so on, (2) nearly all retail stores such as LensCrafters, Pearle Vision, Sears Optical and Target Optical and (3) EyeMed, one of the largest vision insurance companies. Luxottica retail brands: http://www.luxottica.com/en/retail-brands Luxottica eyewear brands: htt…

In Jan 2017, Luxottica announced a merger with the largest lens maker, Essilor. EU antitrust is reviewing, https://www.reuters.com/article/us-luxottica-essilor-merger/...

In turn, Essilor has ownership in Shamir, Eyebuydirect, FramesDirect, Coastal, Coolwinks, Costa Del Mar, Elens, Eotica and Foster Grant, https://www.essilor.com/en/the-group/activities-and-distribu...

If EU regulators allow the merger to go through, one $50B company will own the most online channels for eyeglasses and contacts, in addition to lens manufacturing & retail storefronts & vision insurance.

Re: A Closer Look at the $13B Premium Eyewear Market

#14
post #2

Europeans seem to wear glasses at a much higher rate than Americans. Is there is structural reason for the preference of glasses over contacts?

Might have to do with what public health care covers?

In Germany, they used to cover glasses till 2003, tho you still had to pay for the frame yourself. They also covered contacts but only in special cases, so getting those on prescription was quite a bit more of a hassle.

2003 has been a while ago, but I have no doubt that plenty of people still have their prescription glasses from back then around, I do.

It's got either something to do with that or there's some societal difference which allows American people more easily to touch their eyes because that's usually one of the main reason people don't wear contacts, at least from my anecdotal experience.

Re: A Closer Look at the $13B Premium Eyewear Market

#15
post #8

The reason glasses cost so much is because one company owns: (1) nearly all brand name frames including Ray-Ban, Oakley, Prada eyewear, Armani eyewear and so on, (2) nearly all retail stores such as LensCrafters, Pearle Vision, Sears Optical and Target Optical and (3) EyeMed, one of the largest vision insurance companies. Luxottica retail brands: http://www.luxottica.com/en/retail-brands Luxottica eyewear brands: htt…

I thought it was shady as hell when I got an explanation of benefits letter from my vision insurance (branded Aetna) with a return address of 4000 Luxottica Place.

Re: A Closer Look at the $13B Premium Eyewear Market

#16
post #6

if you’re in to avoiding paying hyper-inflated costs to support entrenched and anticompetitive markets, like what eyeglsses have been for years, I higly recommend Zenni Optical. They have highly customizable options and are great glasses, especially for the price. http://www.zennioptical.com Edit: spelling

Some relevant discussion in this thread, https://news.ycombinator.com/item?id=15373992

Re: A Closer Look at the $13B Premium Eyewear Market

#17
post #8

The reason glasses cost so much is because one company owns: (1) nearly all brand name frames including Ray-Ban, Oakley, Prada eyewear, Armani eyewear and so on, (2) nearly all retail stores such as LensCrafters, Pearle Vision, Sears Optical and Target Optical and (3) EyeMed, one of the largest vision insurance companies. Luxottica retail brands: http://www.luxottica.com/en/retail-brands Luxottica eyewear brands: htt…

They were expensive before. 1-2000% markup on frames, etc. was pretty common in the 90s. Edit: Ok, here we go downvoter. From memory: I could get a Perry Ellis frame out of the Frames catalog for about $10. Sola would sell me bifocal CR-39 lenses for ~$3.50/pair. A bottle of dye to tint lenses was about $4.00 and would last a week. A bottle of UV solution was $12 and it too would last a week. We'd sell the Frames for…

Standard economic theory would say that if there are egregious margins, new players would enter the market and competition would bring down the price. That appears to happen now and then and then Luxottica buys up the players, keeping the prices steady? Alternative explanation that keeps with the facts.

Re: A Closer Look at the $13B Premium Eyewear Market

#18

I'm surprised Warby Parker isn't mentioned at all in this article. Isn't their whole business model built on tackling this market?

No, their business model is based on pretending like they are saving you money when they are just ripping off the customer for marginally less with fancy branding like dollar shave club. Look at Zenni Optical and tell me I'm wrong.

Re: A Closer Look at the $13B Premium Eyewear Market

#19

I'm surprised Warby Parker isn't mentioned at all in this article. Isn't their whole business model built on tackling this market?

No, their business model is based on pretending like they are saving you money when they are just ripping off the customer for marginally less with fancy branding like dollar shave club. Look at Zenni Optical and tell me I'm wrong.

Not sure why this is getting tons of downvotes. Warby Parker's profitability per retail square foot is one of the highest in all of retail mostly because there's such a distance between what their frames cost to make and what they sell them for. Limited choice (Trader Joe's style) and a good sense for the products their target market wants seem to be their secret sauces to pulling off crazy margins on said products.

Re: A Closer Look at the $13B Premium Eyewear Market

#20
If you're ever in Japan or Taiwan, have some glasses made there. JINS in Japan is ~$120 including lenses, lenses ready in 3 hours. Pick up same day. I heard there's a company in Taiwan with a similar business model as well.

They're set up to handle tourists, and will handle duty free as well.

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