Market Trends

A market trend having a positive impact on GrandVision’s business environment is the fact that market regulations have decreased in many countries over the past decades. In addition, the currently fragmented nature of most optical retail markets offers opportunities, as does the growing online market for eyewear.

Deregulation provides benefits for optical retail chains

In various countries market regulation has decreased over the past decades and this trend of market liberalization is set to continue. The easing of these restrictions on eye test and measurement services and on cooperation between optometrists and opticians is facilitating market access by full service optical retailers, including optical retail chains such as GrandVision. In addition, changes to social security and health insurance reimbursement systems are increasing price competition, as the subsidizing of smaller optical retailers is being discontinued, which has positive implications for large scale optical retail chains.

Fragmented markets to consolidate further

Given the high level of fragmentation on a global scale, consolidation is expected to continue, resulting in further growth of more effective and efficient retail formats. Large multinational players in the eyewear market have a more substantial resource base, which better allows for the development or modification of retail best practices and customer service concepts which have a positive impact on customer loyalty. Competitive advantages for large optical retail players such as GrandVision include greater purchasing power with suppliers, the development of best practices in consumer approach and assistance, the attraction and retention of talent, and other economies of scale such as the development of centralized product finishing laboratories and the roll out of marketing campaigns.

Emergence of the online eyewear market

The online eyewear market has grown to approximately 4% of global eyewear sales over the past ten years, which remains below the online penetration levels of other retail segments. The need for personal interaction with consumers to administer eye tests and examinations and to fit prescription eyeglasses creates a higher barrier limiting successful penetration by pure online players. Consumers generally prefer to physically select and try optical products in retail stores while personal contact with opticians and optometrists creates trust and loyalty. However, today’s consumers expect broader and more flexible forms of retail interaction and service. Therefore, GrandVision has established an omni-channel route to market, where online services such as preselecting frames, booking appointments and replenishing contact lenses are integrated with the services provided in physical store networks. The development of online services therefore offers opportunities for the eyewear market.