Bluefly Inc. this spring will branch into a second e-commerce business — prescription eyewear.
This story first appeared in the January 11, 2011 issue of WWD. Subscribe Today.
The New York-based online retailer of discount designer fashion has entered into a joint venture with A+D Labs, a marketer of fashion eyewear, to form Eyefly and launch the site Eyefly.com, which will provide women’s and men’s fashion frames and single-correction lenses for a fixed price of $99. Melissa Payner, chief executive officer of Bluefly and the daughter of an optometrist, believes the combination of an affordable price point and the convenience of online shopping could help it make inroads into the U.S. eyewear market, which she estimated to be about $33 billion a year in sales.
“This makes perfect sense,” she told WWD. “The first thing you see when you look at a person is their glasses, and we have an increasingly young population spending their time online or on their cell phones, PDAs, mobile devices. They live online and they love shopping online.”
And with so much time focused on handheld devices and computer monitors, “many of them need glasses at a younger age, too,” she noted.
While the median age of a Bluefly customer is 35, 48 percent are below that age, according to Payner.
In addition to frames and corrective lenses, Eyefly will market a limited number of sunglasses and readers and, at a later date, might venture into progressive lenses. Payner estimated there will be 30 to 40 frames available by the time the site goes live.
The business will be capitalized with $700,000, with Bluefly investing $364,000 and holding 52 percent of the equity. A+D will invest $336,000 and own the balance. The two parties might later invest an additional $600,000 in the same proportion. Bluefly has the option after four years of buying A+D’s equity in the project based on a fixed EBITDA multiple, which could be paid to A+D in Bluefly shares not to exceed 20 percent of the total outstanding.
Eyefly, accessible through both Eyefly.com and Bluefly.com, also will have a social networking component. Customers can upload pictures of themselves, see how they’d look in individual frames and then export the results through e-mail or to their pages on social networking sites. Customers will enter prescription information themselves but will have the option of directing Eyefly to their eye doctors for verification.
This is a first venture outside of its own site for Bluefly, which was founded in 1998. The company’s shares were up 12 cents, or 4.3 percent, to $2.92 Monday as the S&P Retail Index climbed above the 500 mark, finishing ahead 1.92 points, or 0.4 percent, to 501.73.