Competition in U.S. Eyewear Market Will Intensify

The market for eyewear is mature. Therefore, new sales largely depend on prescription changes and technological innovation, predicts the report Eye Glasses and Contact Lens Stores Industry. But because neither of these strategies yields significant growth, competition will intensify, predicts the report from IBIS World, The Eye Glasses and Contact Lens Stores industry. 

During the past five years, the retail market--in terms of operators--has shrunk from 7,986 firms in 2008 to 7,422 in 2013 and will shrink even further by 2018, thereby increasing the concentration of retail sales. The report attributes this concentration to increased acquisitions, a symptom of a "mature" industry. In other words, the only way a company can grow effectively is by acquiring another company, especially for the major players such as Luxottica, National Vision, and Highmark.

Until 2018, industry growth will follow the economy's growth. There could be a bump. Patients have put off getting new prescriptions. With the economy coming back, they should be returning to outlets for new eyewear and prescriptions. Favorable demographic changes will also likely drive industry growth over the next five years. The number of senior adults aged 50 and older is forecast to grow through 2018. Because this group makes up the industry's largest market segment, its growth will increase demand. Elements of the newly enacted healthcare reform bill will also expand access to vision care, giving industry demand an additional boost. For more information, visit IBISWorld’s Eye Glasses and Contact Lens Stores in the US industry report page. Read more.

More Australians Prefer Online than Brick 'n Mortar Optical

"A recent study from IBISWorld revealed more Australians prefer to purchase contact lenses or eyeglasses from an online store rather than a physical retail location due to ease of use and convenience associated with online shopping," according to a report on EWay. "According to the report, online eyeglasses retailers are able to take advantage of low operating cost structures, providing aggressively discounted items online to offer significant savings over bricks-and-mortars, which must also juggle labour and utility costs. Contact lens and eyeglasses retailers have improved their online stores to make it more enjoyable to purchase eyewear online, including higher levels of interactivity, virtual fitting rooms and customisable options for each purchase. From 2012 to 2013, industry revenue is expected to increase 5.6 percent annually to reach $65 million." Read more.

Ease of Access "Most Important" Growth Factor for Sunwear Stores

The sunglasses stores industry has begun its recovery from the economic storm. The industry was hit hard during the recession because disposable income and consumer sentiment toward the economy were low; both of which are key drivers of industry revenue. Accordingly, revenue fell in both 2008 and 2009, before an uptick in 2010. Improving incomes and a lower pricing strategy have attracted customers and bolstered sales, with revenue growing in both 2010 and 2011. “Though the industry is expected to post growth from 2010 to 2012, recessionary declines in 2008 and 2009 caused revenue to decline overall at an average annual rate of 1.0% to $1.01 billion over the five years to 2012,” said IBISWorld industry analyst Justin Waterman. However, growth will be slightly faster in 2012 with revenue estimated to increase 1.1%. Growth is dependent upon the price and ease of access (i.e. industry players' online sites) of goods: currently the most significant factors driving industry demand.