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Sunny Days for the Eyewear Market

Despite the retail climate, in which consumers are showing discretion in spending their money, eyewear manufacturers are enthusiastic about the category.

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Appeared In
Special Issue
WWD A issue 07/21/2008

LIKE THE UBIQUITOUS DISCO CHANT, THE EYEWEAR category “will survive.” Despite the current retail climate, in which consumers are showing discretion in spending their hard-earned dollars, eyewear manufacturers are enthusiastic about the category. “When you experience a recession and a weak economy, families are feeling the pressure of a higher cost of living and they tend to reduce expenses on items they feel are unnecessary,” says Claudio Gottardi, president and chief executive officer of Safilo USA. “But they are also looking for some alternative to those former purchases that still give that feel-good sensation. So if before they were buying a new handbag for ladies or a new watch for men or anything expensive in the luxury category, today they will revert back to sunglasses, which are the most visible statements of fashion at the most reasonable price.” And like high-carat diamonds or a status-proving Hermès Birkin bag, the luxury sector of the eyewear business has not experienced a slowdown, but is instead reporting growth. Robert Marc, whose handmade frames retail from $250 to $1,500 and average $400 per pair, says he’s had exceptional sales in the last year. “We have a special customer who is looking for special things,” Marc says. “We do very well in the $600 and $700 range. We’re selling more this year than ever before. We’ve always done well through these times.” Sheila Vance, founder and ceo of Sama Eyewear, which in addition to its eponymous collection produces eyewear for Badgley Mischka and Loree Rodkin, says her high-end pieces are also faring strongly. “We only have luxury product and our customers are still into their fashion,” Vance says. “We’re not affected yet. The market has changed, but our type of customer is still not showing signs of saving or not spending. If we weren’t luxury, we would have felt it much stronger.” Ray Franzino, executive vice president at licensing firm B. Robinson, whose Legacie division produces high-end eyewear from such brands as Leiber and Kata Eyewear, says that the more expensive the frame, the better it sells. “Luxury is holding its own more so than the department store business at a lower price point,” says Franzino. Franzino acknowledges, however, that consumers are no longer buying multiple pairs of frames the way they once were. “What we see happening is that the consumer in the past was buying more multiple frames, now they’re looking to buy one frame for the season,” he says. “So it’s changed in terms of buying better quality, maybe not three, but one that can be wearable throughout the season. Leiber is still selling strongly in the $600 to $1,000 [range].” Mark Ginsberg, senior vice president of designer brands at Marchon Eyewear, adds, “Customers today are thinking twice about a $1,500 bag, but are not reluctant to spend $300 or $400 on a new pair of sunglasses. The luxury customer especially is still out
there spending. They may not be spending as much, but they’re still buying new eyewear.” Ginsberg notes the firm’s Pucci brand, which retails from $295 to $450, is selling at record rates for the company. But the eyewear category is not totally immune to our nation’s looming recession. Most companies manufacture abroad, in countries such as Japan and Italy. The weakening dollar has eyewear executives paying close attention to their budgets. “The weakness of the dollar is by far the biggest problem we have,” says Gottardi. “We are a company with a big importer of ‘made in Italy’ product — Gucci, Dior, Armani, Valentino. We have five factories of about 4,000 people that are working to produce millions of sunglasses shipped around the world.” Gottardi also states that when he presented his eyewear at market last August, the dollar-to-euro rate was 15 percent lower than it was by the time he delivered in March. “Our people are paid in euros,” says Gottardi. “Everything I was selling was worth 15 percent less than when I produced it. That is normally an exchange rate difference that happens over years and years.” But it’s not just the weak dollar that is creating headaches for eyewear firms — increased prices all around are affecting firms’
bottom lines. “Our challenge is the raised costs across the board,” says Franzino. “We’re working closely with our factories, doing different techniques that can still maintain quality and margins. The big challenge is the price of oil affecting eyewear components.…And even getting it here, putting it on a plane — if you can’t afford the surcharge, it’s going to go by sea. So then we have to plan our seasons earlier. We plan our strategies a lot better if it’s going to take 30 days on a boat.” Larry Leight, founder and chief designer of Oliver Peoples, adds, “There’s an additional cost in manufacturing. Some of it has to do with the yen and the money exchange rate as well as the cost of some of our own labor. We also put more money into our own advertising, look books and brochures. But in terms of shipping rates, our trucking is more expensive, and it’s more costly when our reps take flights to do trade shows. So we can’t spend the same money to get the same sales anymore. The cost of doing business is more, so we’ve had to incorporate it.” But not even heightened costs have stopped apparel companies from entering the eyewear game. In the last two years, brands such as Pucci, Jimmy Choo, Karl Lagerfeld, 3.1 Phillip Lim, Proenza Schouler and
Alberta Ferretti have all launched eyewear. It’s to the point where a luxury brand cannot claim it is a “lifestyle brand” until it offers an eyewear collection. “They feel that a great way to get exposure for that brand is to create an
affordable, small piece that people can buy,” says Leight. “[Eyewear] is an accessory that completes a collection and they look around and say, ‘How are we going to get our name out and compete if we just have clothing?’ They want more exposure.” The additions in the market have not been lost on consumers, either. Ed Burstell, senior vice president and general merchandise manager, nonapparel at Bergdorf Goodman, notes that shoppers are flocking to their favorite ready-to-wear label’s eyewear collections. “Eyewear has very seamlessly worked itself into one more layer of your fashion wardrobe,” says Burstell. “When runway is hot, it does transfer. Brands like Balenciaga and Bottega Veneta are doing incredibly well in apparel and the eyewear is doing well, too.” At Henri Bendel, senior vice
president and general manager for fashion Scott Schramm notes that the store’s customers are interested in buying into a luxury brand. “Sunglasses continue to be a great entry point for consumers wanting a designer label,” Schramm says. “We’re seeing nice increases over last year and we’re seeing it at a range of prices that have given us a broad audience. Chanel is having an amazing season for us, they keep pushing the average price point as
well as adding more depth in our lifestyle offerings.” Fabio D’Angelantonio, group marketing director at Luxottica
Group SpA, also cites a connection between the eyewear business and the runway. “It’s amazing how much this business is coming closer to the fashion world,” says D’Angelantonio. “It’s really collection-driven. The more and more aware we are of types of styles and colors, the more we are driven by fashion and collections in the marketplace. Three years ago, this was not imaginable.” At retail, Burstell notes that independent of the economy,
eyewear sales at the store have been “robust.” “There’s been a lot of newness and innovation that has kept excitement in the category,” Burstell says. “There’s great styles happening and we do enjoy a nice ‘out-of-town’
business. And they shop differently and are looking for more logo-driven pieces. So we have all of our bases covered. The local customer is looking for something more subtle and the out-of-towners are gearing their purchases toward logos.” According to Burstell, Bergdorf Goodman is in the midst of undergoing a renovation in its eyewear department. He says they’ll be sprucing up the section as the category grows. Schramm notes that Henri
Bendel’s eyewear offerings are merchandised more and more throughout the store, to offer consumers a head-to-toe look. “We’re getting sunglasses out of the traditional wall or case and treating it more like an accessory,” Schramm says. “We’ve been pushing our partners on that, and they are receptive to us layering sunglasses throughout the store. We want to display it in an unconventional way. It’s very positive and it shows we believe in the category in a big way.” One of eyewear’s hottest trends is “the antilogo” logo. Even companies famous for their over-the-top branding — Chanel, Gucci, Dior — have pared down their blinged-out temple treatments in favor of a more subdued look. “It’s definitely not about big labels on the side right now,” says Marc. “It’s very much a studied, scholarly look that people are going for, really tailored. People are so into the eyewear as eyewear. We’re selling more eyewear that looks like prescription than we ever have before. People want to wear glasses again.”
Sama created a collection for fall titled Incognito. Like the name, the pieces lack any attention-drawing
characteristics. “For a while, there was too much going on,” Vance says. “I like my designs to remain as such that they don’t define people, but will complement them. Our recent collections are more subtle, simpler, focusing on design and quality as a trend. It’s a sophisticated look.” Ginsberg adds, “The idea of logos and branding isn’t as bold as it was last year, it’s still integral, but more subtle. It’s got to make sense, you can’t just pop on a plaque with a name, but integrate it into a hinge or frame. It’s a little softer and quieter.” Other trends in eyewear offer a more vintage feel. Oliver Peoples’ Hollis and Tycoon frames present an urban, hip look. “Consumers who aren’t going with oversize glamour want more of a fun, unisex look,” Leight says. “It’s feminine in a different way, more character-like. We see more of that old-school look too, like a retro, 1950s director type of glasses.” Safilo is also seeing a strong consumer resonance with vintageinspired frames. The firm brought back the frame Carrera from the
Eighties. And Luxottica, too, has had major success with the Ray-Ban Wayfarer, a throwback to the Fifties beatnik era. As for global expansion, both eyewear companies and luxury brands have their eyes set on emerging markets such as Brazil, Russia, India and China. “These markets are today the hottest markets where the majority of growth will come,” says Gottardi. “For any company that is worldwide, these regions are showing the biggest growth. We are investing a lot of money in building our own stores and increasing distribution in those areas as fast as we can.”

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