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LUXOTTICA’S LUXURY SAVOIR FAIRE RUBS OFF ON LENSCRAFTERS

By Rodger Brown

In 1995 the $5 billion-revenue Luxottica Group, a Milan, Italy-based frame maker, acqufired LensCrafters and its 800-plus stores. The deal gave Luxottica an immediate presence in malls and shopping centers in the U.S. and Canada and made the world’s leading manufacturer of prescription frames the world’s largest retailer as well.

And when the 2,200-square-foot LensCrafters store on New York City’s Fifth Avenue reopened in the spring with a new look featuring dark wood and backlit displays, it became one of the company’s first to introduce the boutique experience into a chain that was known simply for being fast, efficient and affordable.

The strategy is designed to get the message to Middle America that eyeglasses are no longer merely for seeing — they are also for being seen. “Make an Appearance,” declared advertising copy accompanying the launch of the new store look. “We’ve been building LensCrafters to a more premium brand for the last several years,” said Seth McLaughlin, senior vice president of marketing for Luxottica’s North American retail division, in a press release. “Today we have additional elements such as a new store concept, associate training, advertising and marketing that, all together, represent the premium brand and future direction of LensCrafters.”

Luxottica is the world’s leading eyewear company, and its move to consolidate its global dominance does not end with taking LensCrafters upscale. Half Luxottica’s business is still wholesale, but it is aggressively acquiring retail chains worldwide. In 2004 it nudged out a Hong Kong rival to acquire Cole National, which owned Pearle Vision, Sears Optical and other, smaller stores. That move added nearly 2,900 outlets to Luxottica’s North American holdings. And in May the company bought a 74-store chain in Canada that it will rebrand as Pearle Vision, bringing its footprint there to 268 stores, for a North American total hovering around 6,000.

Then, of course, there is China. In June Luxottica bought 28 stores in Shanghai, bringing its holdings in China to 290 stores. The company is also opening two manufacturing plants there.

Pitching spectacles as a fashion item is nothing new. But Luxottica’s revamp of the LensCrafters look is more than just a response to the trend of viewing frames as a stylish accessory. It is also a way it can move more product. Luxottica makes prescription frames and sunglasses under a total of 26 brands, including Chanel, Prada, Ray-Ban and Versace. The company also owns Sunglass Hut.

To make it easier for customers to drop $300 to $500 for its delicate twists of plastic and wire, LensCrafters’ overhaul entails more than mere changes to the store floor plans. Style consultants coach the sales associates on such things as personal dress or how to couch frank fashion advice in friendly terms.

Key brands are so important to the eyewear sector that Luxottica has been locked in a struggle with the other global sector leader, Padua, Italy-based Safilo Group, over some leading names. In January Luxottica lured Ra-ph Lauren away from Safilo by anteing up $200 million in advance royalties, and it also bagged Dolce & Gabbana for $72 million. Armani and Hugo Boss, on the other hand, have sided with Safilo. Are the stakes high? Well, according to The New York Times, Ralph Lauren had accounted for 10 percent of Safilo’s yearly revenues.