Features: Marketpulse

May
2002

Lenses Take the Lead








The role lenses play in independent optical dispensaries can be found by looking “inside” two important numbers: lens units (a.k.a., pairs) sold and retail dollar sales from spectacle lenses.












In terms of units sold in 2001, for instance, according to the Jobson Optical Group Database, conventional plastic lenses led the way in independent optical shops, at 57.5 percent. Polycarbonate was next at 29 percent, followed by mid-/high-index (10.5 percent) and glass (3 percent). On the design front, single-vision lenses, of course, accounted for the brunt of units sold (52.3 percent) by independents in 2001, followed by bi-/tri-focals (24.5 percent) and progressives (23.2 percent).

Retail dollar sales, however, tell a markedly different story. According to the 20/20 MarketPulse—Premium Lens Survey of Independents 2002, conventional plastic accounted for only 50.7 percent of retail dollar sales in independent dispensaries in 2001, followed by polycarbonate (28.6 percent), mid-/high-index (15.9 percent) and glass (4.7 percent). Trivex, in its first year on the market, accounted for 0.1 percent of retail dollar sales for spectacle lenses. Among designs, the differences are even more pronounced. Progressives led the way, generating 40 percent of retail dollar lens sales among independents (including 3 percent for computer vision/indoor progressive lenses), followed by single-vision lenses (36.1 percent) and bi-/tri-focals (23.9 percent).

The “X factor” here, of course, is product price. Although products such as progressives, polycarbonate lenses and mid-/high-index lenses don’t make up the majority of sales in independent dispensaries, they do generate more revenue than products such as glass and conventional plastic at retail due to their premium price tags. This may sound familiar. The research findings essentially echo the marketing message of many spectacle lens manufacturers: Selling premium products improves profits.

Consider this: The average retail price for complete eyewear (lenses, lens treatments and frames) increased from $226.24 in 2000 to $247.17 last year. According to the survey, lenses and lens treatments comprised 49.4 percent of this retail sales price, compared to the 47.6 percent attributable to frames.
Fact is dispensers are able to sell spectacles with more bells and whistles than ever before and they’ve been able to do so despite gloomy predictions for the optical market in recent years. In addition to premium lens materials and designs, revenue from several treatment and add-on categories also increased from 2000 to 2001. For example:

• Sales revenue of more premium polarized sunlenses increased from 30.8 percent of all sunglass sales in 2000 to 31.8 percent last year. (According to the survey, 64.4 percent of all Rx sunwear sold in 2001 included polarized lenses, up from 63.1 percent in 2000.) The average retail price for polarized lenses increased over the same period—from $232.42 to $245.38 for Rx and from $119.90 to $125.13 for plano.

• Sales of photochromic lenses in independent dispensaries increased from 12 percent in 2000 to 20.9 percent, according to the survey. This latter number is probably a bit high, but any increase in photochromic sales can be directly attributable to the introduction of new, better-performing products and fashion colors. Though gray and brown make up the vast majority of photochromic lens dyes sold, responding dispensers also reported selling red, yellow and blue “changing” lenses in 2001. With more and more manufacturers introducing new products in the photochromic category, expect the lenses that darken in sunlight to lead the next growth spurt in the spectacle lens market.

• Awareness among independents of new, high-tech specialty lens products such as computer vision/office/indoor progressive lenses increased to 92.7 percent, up from 82.1 percent the previous year. Of the respondents, 74.4 percent reported selling these lenses designed with increased intermediate and near vision for occupational use in their dispensaries in 2001, a slight increase from 74.2 percent in 2000.

• According to this year’s survey, 31.9 percent of the lenses sold in independent dispensaries are anti-reflective (A-R) coated. Frankly, many manufacturers wish it was that high (apparently, 20/20’s survey respondents are ahead of the curve). But, the number indicates willingness among dispensers to work with this product, which has had a spotty history in the U.S. to say the least. At the recent Vision Expo trade show in New York, manufacturers made it clear that A-R can and will be a key growth area in the U.S. over the next several years. Look for improved—and, perhaps most importantly, branded—A-R products to hit the market in the next few months.

Numbers and trends such as these highlight the importance of premium lens products to the optical industry as a whole. As other categories struggle in the current recessionary economy, lens sales—and particularly those of premium products—continue to increase

As a result, on the independent level, where revenues from exams/refractions perhaps come more into play, lenses and lens treatments are still the bread and butter. According to 20/20 survey, lenses and lens treatments accounted for 37.1 percent of independents’ total gross dollar sales in 2001 (not including another 7.8 percent from Rx sunlenses), up from 32.2 percent the previous year. Frames, meanwhile, made up only 28.5 percent. Moreover, contact lenses accounted for 15.2 percent of independents’ gross dollar sales in 2001, down from 16.1 percent the previous year. It’s clear from these survey figures, then, that lenses will play a key role in any optical recovery in 2002.

 

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