US eyewear market sees boost thanks to economic recovery
The eyewear industry is controlled by major global players that drive the vast majority of sales. Unbeknown to many consumers, most of the eyewear products they purchase come from only a handful of parent companies. This sort of market monopolisation makes it incredibly difficult for new players to enter the arena. Production and manufacturing of eyewear products are capital intensive. The market is consolidating on all fronts from retailers to manufacturers. There is a sense that this consolidation is beginning to look more and more like vertical integration whereby a company owns the various operations from production to sales - even covering eyewear insurance companies - to offer the most competitive price points.
As the leading companies continue purchasing smaller operations, independent eye care professionals are facing more pressure to maintain their customer bases and sales. For many independents, their sales from eye exams remain consistent; however, they are seeing declines in eyewear purchases, particularly contact lenses. As a result, many mid-sized entities are forming from an aggregation of individual, independent operations. This pattern is expected to continue, and will result in more advanced strategies to retain customers. Trade associations are seeing this pattern and focusing their resources to help smaller operations compete in this competitive environment dominated by a few key players.
As the internet continues to touch more and more aspects of life, the eyewear industry is beginning to see some major changes. In 2013, many companies - new and old - are ramping up their internet retailing to attract more customers. The industry is seeing major advancements in technology as this was the primary hurdle preventing customers purchasing eyewear online, eg sizing, prescription, confidence in services and quality. Now, price and choice online are driving increasing numbers of consumers to turn to e-retailing to make purchase decisions. Technology that offers "Virtual Try-On" capabilities will lead the way for future internet retailing of spectacles. As for contact lenses, e-retailing continues to grow at the expense of traditional, physical stores.
Optical shops remain the primary source for eyewear products; however, they continue to experience a loss of market share to other channels. Many other retailers are increasingly integrating optical goods into their shopping formats. Many mass merchandisers, warehouse clubs and grocery retailers are including optical departments in their stores to offer customers more convenience in their shopping experience. By including more services, retailers are able to offer one-stop shopping that goes beyond the conventional purchases. Many retailers, especially grocery stores, operate on small margins and need to diversify their product portfolios to remain relevant. Chains that offer optical services and products are able to capitalise on the low costs they are able to offer their customers because of their purchasing power. This gives optical shops associated with mass merchandisers, warehouse clubs and grocery stores a major competitive advantage over traditional optical shops.
The recovery continues to mark good news for the eyewear industry, which experienced significant downturns during the economic recession. As consumers regain confidence, they are continuing to make purchases that were previously dismissed. People were extending their repurchase rate of many eyewear products as they used their money to buy other things deemed more necessary during the tough economic times. Lenses and sunglasses are experiencing higher purchases as these were previously overlooked. Yet, people remain hesitant to return to pre-recession habits. The recession is still too recent for people to forget it, thus many consumers are indicating shorter re-purchase periods but do not feel comfortable to return to pre-recession purchase rates. All in all, value and volume sales for eyewear will experience growth in the coming five years.