If there ever was a tale to be told about an underdog going after an industry giant, we’ve got one in the making. Move over Ben & Jerry’s, Dyson and Netflix. Make room for Warby Parker.
A conversation in a computer lab at the University of Pennsylvania about the ridiculously-high prices of prescription glasses led four guys to conclude it was time to disrupt the prescription eyewear industry.
In 2010, Neil Blumenthal, Andrew Hunt, David Gilboa and Jeffrey Raider set up their Warby Parker online eyewear shop with $2,500, gave it a funky name (the combination of two characters in a Jack Kerouac novel), and created a business model that allows the company to offer prescription lenses in high-quality frames for less than 100 bucks.
Warby Parker’s goal isn’t to become the $95 Dollar Store of the eyewear world. Their eyeglasses are stylish and affordable. A pair of Warby Parkers with prescription lenses, anti-reflective coating, free shipping and no-questions-asked returns will set you back $95.
With a price-point that would only keep the average SUV in gasoline for a week, the company is making a profit with some pretty common sense practices.
The cost-minimizing practices they’ve taken are likely doable for a huge chunk of companies out there. Then what makes Warby Parker such a phenomenon?
Taking a page from Zappos (and spinning it for a more complicated product) Warby Parker’s customer experience is priority number one. It shows in demonstrations like these:
For every pair of glasses it sells, Warby Parker donates money to non-profits that use the money to support the poor in low income countries. Funds for its “Buy a Pair, Give a Pair” program go to groups that create economies. Their non-profit partners train people to give basic eye exams and sell prescription glasses. This offers the chance to make a living with an invaluable service for their communities. The company estimates the economic impact of the one million pairs of glasses already distributed or sold has been $200 million.
Warby Parker’s challenge to make a dent in the eyewear industry can be compared to early Apple taking on IBM. One of their competitors, the 50 year-old Italian company Luxottica, has quietly expanded its empire to a 30% market share and ownership of the value chain.
You might not know the Luxottica name, but you have heard of its brands.
Walk into the typical eyewear store. Every vertical surface is covered by frames with names like Ray-Ban, Oakley, Persol and Vogue. All are owned by Luxottica. What the company doesn’t own, it licenses. Luxottica owns the rights to make and sell eyewear with names like Georgio Armani, Versace and Donna Karan.
If the store you happen to be in is a LensCrafters, Sunglass Hut, Pearl Vision, or even the optical departments at Target and Sears, it’s owned by Luxottica. Luxottica controls all parts of the eyewear supply chain, even the vision insurance provider EyeMed.
With an innovative business model and customer service practices that define the “duh” factor, Warby Parker is chewing away at Luxottica’s (and their big friends’) hold on the eyewear market. Warby Parker glasses are a little bit funky, a lot durable and fast becoming a sign of a cool-factor that you can’t get with a $400 pair of Ray Bans or Armanis.