Features: Marketpulse

May
2002

Kidz Biz





Kidz Biz

Kids “R” Business—a serious business that’s still maturing

By Gloria Nicola

Selling eyewear to kids is fun. The kids are cute. The eyewear is cute. And the point-of-purchase materials include familiar cartoon characters and favorite toys, ranging from cuddly stuffed animals to stylish dolls. But the kids’ business is not just fun and games. It’s a serious business and an essential part of the overall optical market. It’s also demanding with a distinctive set of challenges. And according to respondents to 20/20’s Kids’ Eyewear MarketPulse of Independents 2002, the kids’ eyewear segment has been facing its own set of growing pains—average price points are on the rise, but actual sales are decreasing in several categories, no doubt reflecting an uncertain economic climate.


The survey was conducted among 151 independent optical retailers, including opticians, optometrists and dispensing ophthalmologists. For the purposes of this report, children’s eyewear consists of frames, lenses, contact lenses, sunglasses, sports glasses and accessories sold to children up to 14 years old.

THE BIG PICTURE
Although children are a significant segment of the optical business—survey participants report children accounted for 15 percent of their customer base in 2001—this figure is down from the 20 percent indicated for 2000. However, total gross dollar sales obtained from children’s eyewear products and related services remained at 15 percent, the same as the previous year.

The fact income remained the same despite a decline in customers is undoubtedly the result of a sharp increase in the average price of eyewear. The average price for a child’s frame and lenses shot up from $150 in 2000 to $170 in 2001, survey respondents say. The increase was fueled largely by frames. The average frame price has risen from $90.50 in 1999 and $95 in 2000 to $100 in 2001, in all likelihood because most frames dispensed to children (90 percent, according to respondents) are metal, generally a more expensive material than plastic. Average lens prices (90 percent of those dispensed are polycarbonate) remained the same in 2000 and 2001 at $80, but was up substantially from $69 cited in 1999.



Average price points for Rx and plano sunwear also rose in 2001, according to the survey. Rx sunglasses sold to kids at an average of $150, up from $140 in 2000 and $125 in 1999, but accounted for only 12.5 percent of total sunglass sales to children in 2001—down substantially from 30 percent for the previous year. Plano sunglass prices inched up to $60 in 2001 from $59.50 in 2000 and now comprise 10 percent of total sunglass sales, up from 5 percent in 2000. Average prices for clips remained at a consistent $40 from 1999 through 2001, but clips (still the most active sunglass area in the kids’ category) represented only 36.5 percent of all sunglass sales for current survey participants. This figure was down from 50 percent in 1999 and 47 percent in 2000. But perhaps the most significant finding in the sunglass category is the decline in the percentage of respondents dispensing sunwear to children. This figure decreased from 51.3 percent in 1999 to 48 and then fell to 42 percent in 2001.

 Other survey findings pointing toward a weak market in the sale of children’s products include multiple purchases, sports glasses and contact lenses. Perhaps the weakest spot in the children’s eyewear market is the selling of multiple pairs. Although everyone agrees, children, more so than adults, need a back-up pair for the times glasses are left at school or at home or inevitably broken on the playground—and they certainly need a sunglass—only 2 percent of those surveyed dispense multiple pairs to children, down from 3 percent in 2000 and 5 percent in 1999. The children’s sports eyewear market, too, has witnessed decreasing activity, according to survey respondents as has the contact lens segment. For 2001, 70.8 percent of participants say they dispense sports eyewear to children, a decrease from 79.9 percent in 2000. And 58 percent of the 2001 respondents dispense contact lenses to children, compared with 77.4 percent in 2000. Surprisingly, children’s accessories (cases, cords and lens care products designed specifically for children) made a strong showing in this survey. Of the participants, 76.2 percent say they carry accessories designed for children, up from 71.4 percent in the previous year. Although 78 percent give the accessories away, 64.5 percent also sell them. Additionally, 43.1 percent indicate they both sell and give away accessories.

On another positive note, those surveyed report the majority of their child customers continue to receive exams on an annual basis, just as they have in the past.



THE AGE CHALLENGE
In addition to the economic challenges, which are undoubtedly slowing the optical market in general, the kids’ market continues to face another major challenge. When selling to kids, eyecare professional actually have two customers—the child and the parents. What the child wants is frequently at odds with what parents want.  For kids, color is far and away the most important factor. Survey participants report that 64.3 percent of their child customers select frames on the basis of color; followed by shape, 32.2 percent; durability/functionality, 29.4 percent; and branded names, 25.2 percent. Of least interest to children are lens and frame materials.

On the other hand, for parents functionality and durability are the number-one concern in selecting eyewear for their children, indicated by 95.1 percent of those surveyed, followed by lens materials, 70.6 percent; eye shapes, 58 percent; and frame materials, 41.3 percent. Color, at 32 percent, and brands, at 5.6 percent, are of less significance to parents. The lack of enthusiasm for brand names on the part of both children and, especially, parents is interesting in that branded product accounted for 50 percent of all frame product sold to children in 2001.

With such vastly different interests, who makes the final choice in eyewear selection? According to survey participants, parents make the selection 60 percent of the time and children 40 percent. This is a change from last year when the decision was evenly split at 50 percent between the two groups. This change is unfortunate because dispensers emphasize children should actively participate in the selection of their eyewear—if they don’t like them they won’t wear them. 
Another challenge facing optical retailers when selling to children is the young teen (known as tweens), 11- to 14-year-old age category. The difficulty occurs because this group does not like going into a dispensary full of stuffed animals and coloring books. Unfortunately, only 14.7 percent of those surveyed report advertising directly to tweens—through newspapers, Pennysavers, web sites and radio commercials. Additionally, more than 30 percent of the respondents indicate a need for increased options for young teens. To fill the gap, 75 percent of surveyed dispensers rely on adult frames in smaller sizes.

In the area of optical retail, the kids’ business is still a relatively young business, but like the kids themselves, full of potential. It’s demanding work, though, requiring concentrated energy and dedication before it matures into the business it should be.

 

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