Last week online eye care retailer Vision Direct added sunglasses to its product offering (News 10.06.16) in the UK, a move which the company’s CEO Michael Kraftman described as the first part of an exciting transformation after becoming part of the Essilor family.
This ‘Essilor family’ has increased significantly in recent years. The company’s recently published annual report for 2015-16 revealed that Essilor International had made 19 acquisitions in 2015 alone, adding aggregate additional annual revenue of €214m. Its interest in online retailing, which many opticians consider to be their competition, has also grown significantly.
In the report, the company said it wanted to get ‘closer to the consumer’ in an effort to better understand the visual needs of the 7.2bn people worldwide that need vision correction and said it plans to do so in a variety of ways. Boosting brand communication and strengthening its online presence were two of the ways the company planned to reach more people, while at the same time, ‘supporting ECPs’.
Online presence had been slowly increasing since the turn of the millennium, with the acquisition of Vision Web. In 2009, the company bought Framesdirect.com, followed by Eye Buy Direct, Bonlon and Costa in subsequent years.
In 2014, Essilor acquired Coastal Contacts, a Canadian vision care retailer that offered a range of contact lenses, prescription sunglass and ophthalmic frames. The purchase was worth $430m and saw Essilor take control of Coastal’s online businesses in North America and Europe.
Coastal Contacts operated in the UK under the name lensway.co.uk, which offered contact lenses from Johnson & Johnson and Bausch+Lomb and prescription frames from Oakley and Nike among others.
The lensway.co.uk site also partners with another online eyewear retailer, redhotsunglasses.co.uk, which is the transactional partner for eyewear brand Hook LDN, which is produced by Fabris Lane, which last year was acquired by Essilor subsidiary FGX International.
Commenting on the acquisition of Coastal at the time, Hubert Sagnières, Essilor’s chairman and chief executive officer said the internet had an important role to play in helping the company to fulfil its corporate mission of enabling people to enjoy a better life through better sight. However, the industry had diversified and what Sagnières said was the traditional first step towards achieving the company’s objectives, a comprehensive eye test, was no longer viable due to a splintered purchasing process.
‘With coastal.com, Essilor is acquiring a recognised online vision care platform. Our commitment is to contribute to shape this distribution channel for the benefit of the entire industry as well as consumers,’ said Sagnières in 2014.
Essilor CEO Hubert Sagnières
Coastal Contacts was rebranded to Clearly a year later, claiming it was the world’s largest online eyewear retailer. The Clearly name was said to have aligned with its mission to help people see clearly, fight poor vision and ambition to make vision care accessible to one billion pairs of eyes by 2030.
Perhaps the most significant acquisition for the UK market was that of the Dutch Vision Direct Group. At the time, the site only offered contact lenses, but that has now changed with the recent addition of sunglasses. Its range of sunglass brands are produced and licenced by Fabris Lane, which is owned by FGX International.
Optician asked Essilor if it intended to offer ophthalmic products on the Vision Direct site in the near future? ‘Yes, that would be a natural extension for VisionDirect. The site’s strategy is to provide the best possible experience to consumers: giving access to products that suit their vision needs and wearer preferences, while ensuring quality of education and advice on vision care, as well as reliability of delivery,’ said a company spokesperson.
After the acquisition, criticism from the profession was also levelled at the site for the promotion to customers that a contact lens prescription was not needed, something which is still promoted currently.
Optician asked Essilor if these messages were in conflict with its own brand values. ‘The group’s objective is to comply with the appropriate standards of care and applicable laws. VisionDirect, which makes sales to the UK through a Netherlands registered company has received confirmation from the General Optical Council that its practices are lawful. Furthermore, it is compliant with the new GOC Code of Conduct for online sales of contact lenses,’ said a company spokesperson.
Acquisitions like that of Vision Direct were always likely to stir up debate from within the UK optical industry, but can the online retail and traditional ECP distribution channels work in harmony? Essilor believes they can, with the two complementing each other.
‘The internet is well-suited to straightforward optical purchases: plano sunwear, readers, basic ametropic prescription eyewear and contact lenses beyond the first fitting.
‘It stimulates optical demand, as online consumers tend to renew their optical wear more frequently and also favour multiple pairs. It also engages consumers in a much more immediate way and helps promote innovation. It also allows the provision of better information on visual health issues and increasing awareness on the need for regular eyes checks,’ Essilor told Optician.
Whether the immediacy of online retail allows time for these messages on visual health to register with users, remains to be seen.
Retail role
The ECP still has an important part to play in multi-channel retail, said the company: ‘They remain the most relevant expert for enhanced care, able to provide added value to consumers through vision care services, as well as proper advice and solutions towards a perfect vision.’
In a presentation given in London at an investor day, Essilor explained that the online channel was likely to meet the needs of younger consumers, while high street practices were imagined to be the best channel for bifocal and tailored products, with promotion of key brands such as Varilux.
Essilor also said that it remained committed to helping ECPs develop their own digital solutions and web presence as extensions of their own stores, better serving existing customers and capturing new ones. The company is in the process of rolling out a global expansion to My Online Optical, a suite of online services said to provide ECPs with their own sites and e-commerce capability.
Essilor’s role in future multi-channel retail will be closely monitored by independent practice owners but the company wants to develop its online business nonetheless. It wants to make €400-500m profit by 2018, which equates to more than 20% of its compound annual growth rate.
‘Developing online sales makes it easier to reach a greater number of consumers while ensuring the distribution of quality optical products. As a partner for ECPs, Essilor’s role is to help them take advantage of all the possibilities offered by digital.
‘The company wants to contribute to shaping the development of the internet channel, through its online education sites as well as the expansion of its e-commerce activities. The group is committed to ensuring that the development of online sales in the optical industry does not come at the expense of wearers’ safety and the quality of optical products.’
Essilor International retail portals
FGX International retail portals