LensCrafters 2007 Annual Report Download - page 35

> 34 | ANNUAL REPORT 2007
In Asia-Pacific, the Group continued to strengthen its retail operations and consolidate its
leadership in the region. Luxottica worked on the integration of its direct distribution network in
Australia and New Zealand, which now operates three brands in the prescription segment: OPSM,
Laubman & Pank and Budget Eyewear. At the end of 2007, Luxottica’s retail network in the region
numbered 910 stores (551 for the prescription business and 359 for the sun segment).
In China and Hong Kong, Luxottica Group’s organization is already well structured and fully
operational. The next steps will be to boost the visibility of the distribution network and product
brands, thus consolidating the Group’s presence in the country, which is of long-term strategic
importance. The product offering will gradually be tailored to the evolution of the Chinese middle
classes, who tend to favor well established fashion brands.
PRESCRIPTION
LensCrafters
Twelve years after joining Luxottica Group, LensCrafters now spans two continents with significant
presence in the United States, Canada, China and HongKong. It is North America’s leading
operator in the fashion eyewear segment, with 951 stores in the United States and Canada, and by
the end of 2007, 140 stores were operating under the LensCrafters brand in China and Hong Kong.
North America
In 2007, despite the slowdown in the economy in North America and a perceptible shift in the role
of managed vision care affecting consumer choices in the North American optical category, the
total comparable store sales increased for the year. 2007 was a very positive year due in part to
heavy investments enabling LensCrafters to capitalize on favorable trends in the North American
market but also on its internal potential, on which future development will focus.
LensCrafters continued in 2007 to roll out the new fashion store design that debuted in 2006. At the
year end, there were 140 LensCrafters stores featuring the sleek and inviting new look. Comparable
store sales in locations with the new design continue to outpace the rest of the chain by 3% in their
first year after re-model. The new format, characterized by refined, exclusive looking interiors and a
high degree of product personalization, openly addresses customers with sophisticated tastes who
are very demanding in terms of quality of service (a clientele that is becoming increasingly important
as a result of LensCrafters advertising campaigns targeting the American consumer). For example,
the new store concept was forcefully backed by the “Make an Appearance” campaign.
Very positive performance was also recorded by stores that hadn’t undergone restyling but
continued to benefit from development initiatives undertaken in the past.
While the new store design and positioning make LensCrafters the destination for top eyewear
collections from designers such as Burberry, Dolce & Gabbana, Polo Ralph Lauren, Prada, and
Versace. LensCrafters also broadened its selection of conservative and classic frames and Oakley
products to meet male customer demand.
Sales of prescription frames and sunglasses produced by Luxottica Group, particularly its fashion
and luxury brands, accounted for around 57% of total LensCrafters sales in 2007, up 9% over the
prior year. In 2008, LensCrafters looks forward to introducing customers tth important new brand
Tiffany & Co., and a full line of Oakley prescription and sun products.
Lenses are another important dimension of LensCrafters offering and expertise. Sales of Anti-
Reflective lenses continued to grow at 13% in 2007, fueled by an 18% increase in sales of
LensCrafters premium AR lenses and FeatherWates Complete? lenses made with Scotchgard?