The eyewear industry began during the 18th century, in France (Pays de Morez, in Jura – North East) inspired from the invention of Roger Bacon of two convex lenses inserted in wooden rims joined together by a nail.
In France, Jura is still the main geographic point of this industry where, all the corporate and innovation departments are based, and coordinated with the Plastics valley in the Oyonnax area (for the extraction of raw materials for glasses) and Paris for manufacturing.
Today the competition on this market is worldwide. Italian and Asian manufacturers entered the market with high competitive advantages on prices and volume of supply. This new competition shows totally new schema of the industry, which is harder to succeed in.
The vision of eyeglasses also changes today, from a healthcare vision to a fashion accessory: an evolution that revolutionizes the market and provides new strategies for existing and new companies.
We organized our analysis through 3 parts: First, the study of the business environment (Supply), secondly, the analysis of the worldwide demand, and finally, our recommendations about this market.
[...] These people need the glasses but they don't really want them, therefore paying a high price for them is a reason for them to postpone their investment The average renewal time is very high in certain countries (up to 3.5 years in France) There are many substitute solutions that fulfill the same need as glasses. The recent advancement in laser therapy to treat eye problems may threaten the market and slow it down Contact lenses can replace glasses The demand is heterogenic: one segment is very hard to satisfy over a long- term period, while others care a lot about their eyewear and do not want to change them frequently. Companies need to choose different strategies that will satisfy those different segments. [...]
[...] We will follow up with an industry analysis through Porter's Five forces schema and other relevant statistics, and then through a study of the competitors' situation. A. Key Characteristics of the Industry The Optical industry is present through three direct competitive markets: - The eyewear sector - Contact lenses - Surgery The main market in the industry is the eyewear sector. However, contact lenses are an improving market for frequent-replacement contacts but its growth in volume is greater than the growth in value, which is not a good characteristic for an attractive market. [...]
[...] For example, Luxottica owns a top quality production site in Italy, the design of the glasses' frame and finally sell it through its own or licensed brands. Vertical integration strategies aim to increase the firm's coverage of the value added chain of an industry by extending backward into the production of components or raw materials or forward into wholesaling and distribution toward end users. It also enables the company to achieve very good costs and quality control on their products facilitating the brand to sell at a premium price making the profit margin higher. [...]
[...] In regards to the main competitors LUXOTTICA: Keep its position of leader in the retail optical business by: - Extending the company's strategy to new markets like Asia, being less concentrated on the US and the Canadian market. - Developing its impact on the market creating exclusivity,improving R&D and innovation - Strengthening its quality image and the efficiency of its Client Service, which is already relevant - Reducing its portfolio to focus on relevant tbrands to reduce confusion SAFILO: Try to become the best, not copying strategy but reinforcing its position by: - Being less dependent on the fluctuations of the market - Obtaining new market shares in Asia, developing its activity on this market, reinforcing its position - Improving the quality of its products - Developing its consumer service L'AMY: Stay accessible and reliable by: - Keeping its traditional strength to be the major player of the French market, strong experience - Focusing its strategy in each market where it is present by adapting to local markets - Reducing costs on the long term by opening more production sites ALAIN MIKLI: Keep the difference, being creative by: - Continuously improving technology and manufacturing (partnership with designers, new materials) - Reinforcing its position and the recognition of the brand by creating its own distribution network - Being less dependent on itsdistributors - Securing the connections between the sites in Europe, Asia and USA COMOTEC: Maintain its competitive advantage by: - Extending its worldwide implantation by extending its position on European and Asian markets - Continuing to invest in R&D to keep its competitive advantage based on innovation and value addition BOURGEOIS: Refresh its image by: - Being less dependent on the market - Increasing its innovation , creating new frames to answer to the domestic demand and worldwide demand, adapting to offer to the population morphology and tastes of the different consumers - Reinforcing communication toward all the company stages (Production/ Finance/ Marketing/ Sales), to have a coordinated vision for the future, and to motivate the - Creating a marketing campaign to refresh its image and develop itsinnovation MARCHON: be the best in what we know , and how to - Reinforcing its position, developing partnerships - Reducing price and distribution costs by producing in Asia or China - Maintaining its advantage in the technological domain (Flexon technology) B. [...]
[...] Emerging niches in the eyeglasses market include sport-specific eyewear (Eyeglasses with a camera permits to add electronics to optics in the “extreme sports”.) Distribution structure The manufacturers today have two possibilities for selling their product over the market: - A Licensing contract - A Distribution contract The Licensor (owner of the brand) can choose to allow Licensee (concessionaire) to use the brand, to overcome barriers to enter the market and to facilitate their implantation. Licensing permits, for example, some of the following opportunities: - Simple contract applied to a country or an area - Easier interaction between partners, involvement of the licensor in the product design phase, in the choice of means of communication - Proportional remuneration However, it can be risky because the failure of the new product could reflect badly on all products that share the brand. [...]
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