According to Retail Insider (R-I), Canada’s largest online retail industry publication, international eyewear retailers are entering Canada in unprecedented numbers. The latest, Michigan-based optical retailer SEE (Selected Eyewear Elements) with 40 USA locations from LA to New York, will open its first Canadian location in Toronto this summer.
Similarly positioned to that other well-known recent foreign entrant, Warby Parker, which has two Toronto locations, SEE will tout in-house designed fashion-forward styles without the haute-couture price. They will encourage multiple pair sales as fashion accessories under the slogan, “hip without the hype”.
The first SEE store location will be about 800 square feet, located in Toronto’s upscale Yorkville area on Cumberland Street, within meters of high-end brand fashion retailers including Gucci, Hermès and Lululemon.
Affordable Eyewear and Simple Pricing
The foreign invasion includes the Australian banner Bailey Nelson, which plans 50 new Canadian store openings in the next several years. Bailey Nelson’s website indicates two new Vancouver area locations coming in the spring of 2017 and one Toronto area store in the fall. Most of Bailey Nelson collections retail between $155 and $185 per frame. UK-based Ollie Quinn entered Canada this spring with ten locations, most of which were previously Bailey Nelson locations. Ollie Quinn simplifies the price decision for customers: every frame is $145 (online).
Trendy Hong Kong-based MUJOSH opened its first Canadian store this spring at West Edmonton Mall, with more to follow as part of a national rollout. MUJOSH spokesperson Doris Jin indicated in a Canadian Press report in April, “Canadian people focus more and more on fashion trends, which makes Canada a promising market for us.”
A common element among these industry-outsider new entrants is the claim of unique fashion styles with affordable pricing – a clear appeal to millennials. Aussie Nick Perry, founder of Bailey Nelson, has a similar story to Warby Parker’s founders. Perry’s brainchild was sparked by a less-than-stellar experience buying eyewear. He found the ordeal of buying glasses to be stale, clinical and expensive.
Is Competition Good?
Why all the foreign interest in Canada? R-I Chief Editor and Founder Craig Patterson suggests, “The market has also been arguably under-served by value-priced eyewear retailers, and a number of homegrown retailers, particularly those selling pricier designer frames, could stand to lose business with these new international entrants.”
Howard K (@ThroughASpectacle), Optician and eyewear fashion expert, agrees that some may see the new competitors as a threat, but sees the upside. “This new development will educate the general public of the misconception that glasses have to be expensive and boring,” says Howard.
What is clear is that most optometrists do not expect to be saved from new retail competition by switching gears to earn more revenue from professional services. In a recent Canadian Eye Care Business Review thought leader webinar, 66% of the audience believed that revenue from professional services will “not come close” to that arising from eyewear dispensing over a three-year period. Only 2% of respondents indicated that revenue from services will surpass that generated by dispensing sales.
Domestic Players on the Move
Out of fear or opportunity, there is an undeniable consolidation of independent eye care professionals as independent optometric practice locations sell off to corporate chains; IRIS and FYiDoctor being the most active of these.
Quebec-based NewLook Vision Group has also joined the expansion race, with the 2016 acquisitions of 11 locations of the iVision chain in Ontario, now converted to Vogue Optical, and 10 locations of the Visions One Hour Optical in British Columbia.
Competitive Strategy is a Choice
How should independent eye care professionals respond to low priced fashionable new competitors? The fragmentation of the frame supplier market provides many different options; from high-end luxury to the one-of-a-kind designer offerings. Or should ECPs stay the course with mid-market brands that offer fashionable choices at reasonable prices? Some might call the latter the “mushy middle” – a position that many believe led to the demise of Sears and other middle-of-the-road retailers caught between discounters and high-end retailers.
These questions are difficult to answer. They go to the heart of what you are as a retailer and how you choose to compete. Howard K suggests, “At the end of the day, a professional and experienced dispenser will set themselves apart.”
Regardless of the answers, choosing a deliberate strategy is a critical choice in any business – no less so for eye care professionals, where over 50% of revenue is derived from dispensing eyewear! If a significant proportion of customers are walking out, script in hand, and looking for eyewear elsewhere, a strategic rethink may be an imperative.
Click here to view a list of recent IRIS acquistions.
Click here to view a list of recent FYi acquistions.