LensCrafters 2007 Annual Report Download - page 37

> 36 | ANNUAL REPORT 2007
The optical segment will continue to grow in step with the offering of fashion brands and products,
introducing brands tailored to the demographic profile of the areas served. The sun segment is
another business opportunity as increasing numbers of Chinese view sunglasses as part of their daily
wardrobe, being increasingly fashion conscious and aware of health issues, especially theyouth.
Store performance was particularly strong in Hong Kong, where all stores have been converted to the
LensCrafters’ brand. The Group’s premium brands, the high profile of its stores and its high level of
service quality have been a great success, as reflected by its growing market share in Hong Kong.
Pearle Vision
Part of the Group since 2004 through the Cole National transaction, 2007 was for Pearle Vision the
year of the re-launch. Its network consists of 880 stores (40 up vs. 2006), of which 477 are
company owned in the United States, Canada and Puerto Rico, and 403 are franchise stores in the
US and the Caribbean.
In North America, Pearle Vision is the number two optical chain after LensCrafters. Although both
brands address the mid- to high-end customer bracket, their positioning in practice is
complementary. Pearle Vision focuses on the factors that made the brand a success: customers
having trust in the medical expertise and quality of service.
The powerful relaunching of the Pearle Vision brand by Luxottica was centered on a return to its
original values, which had made Pearle Vision a byword for generations of Americans, their “Home
of Trusted Eyecare.”
After a long period of positive comparable store sales results and a significant and structurally
solid return to profitability, Pearle Vision is producing the desired results. A product mix
increasingly geared to premium, high value added products has helped restore strong customer
relationships, as have doctor and optometrist involvement and training initiatives and advertising
campaigns (including TV).
At the same time, a drastic reduction in promotions helped improve the positioning of the stores
and consumers perception, resulting in improved quality and profitability.
Sales of Luxottica products enjoyed strong growth. Ray-Ban, Prada, Brooks Brothers and Versace
were some of the better selling brands.
Lastly, to centralize services and achieve economies of scale, all in-store labs were closed and
their work transferred to the eight large central lens finishing facilities serving all the Group’s retail
business in America.
Canada is also a market with huge retail potential. Here the Group had already acquired Shoppers
Optical, a 74 store chainthat, given its good positioning and favorable geographical distribution,
was rebranded to Pearle Vision.
A similar operation was carried out in 2005 when Precision Optical was acquired. The total number
of Pearle Vision branded stores in Canada has now reached 98.
Luxottica is increasingly becoming the preferred supplier to the Pearle Vision franchisees, not only
due to the strength of its brands and the quality of its products but also because of the new and
much improved services of the Franchise Advantage Program. This program features marketing
solutions, and savings on selected categories of products (lenses, lab services, contact lenses,
accessories), all with a high level of service and merchandising support.