There’s no doubt that the corporates of Australia’s eye care world are investing heavily in the battle for contact lens market share… and their investments are paying dividends.
Specsavers claims to have secured 30 per cent of the Australian contact lens market, which is in step with the company’s share of the eye test and prescription eyewear market as well. It’s a big jump in market share in a short space of time – in 2012, the company held just 11 per cent market share. And by all accounts, there’s more growth to come.
Peter Larsen, Specsavers Professional Director, has told mivision the company is on the verge of another contact lens push, aimed at increasing market share even further. “Generally speaking contact lens revenue is still low in Australia and New Zealand in optometry practices, especially when you consider the uptake of contact lenses (5 per cent Australia and 12 per cent in New Zealand) compared to other developed countries,” said Mr. Larsen. “As a nation, in Australia we are far behind the UK, USA, Canada and Japan who are in the 20 per cent to 25 per cent take up; that is 20 per cent to 25 per cent of people who need to wear prescription eyewear choosing to wear contact lenses – often in addition to their glasses.”
Mr. Larsen said the average Specsavers store brings in revenue of “a shade over $2 million per annum”, of which 5 per cent would comprise contact lens sales, although this figure would be more like 10 per cent for some stores. “Our biggest stores are now achieving annual sales above and below the $5 million mark so 5 per cent or 10 per cent of that is now a sizeable sum,” he said.
We all know that customers are time poor and they will take up convenience if it is offered to them…
Big W Vision stores are tracking at a similar percentage of sales with the company’s Head of Optical, Ian Whelan advising mivision the average percentage of contact lens revenue vs. total eye care revenue sits at 4.8 per cent and the highest achieving store averaging contact lens sales at 16.2 per cent of total sales. With only 50 stores across Australia, and concentrated in Sydney, Brisbane and Melbourne, Big W Vision is yet to gain a strong hold on contact lens market share, but nevertheless, efforts are being made to grow this sector of the business. “All of our Big W optical stores are staffed with fully qualified optometrists who have received practical coaching on contact lens fitting and extensive product training, and we stock contact lenses from all the main players,” said Mr. Whelan.
“Over the past 12 months we’ve had a big push on contact lens sales and we’ve changed our pricing to become more competitive with online sales. Our stores stock a range of trial contact lens sets and we’ve recently re-packaged our contact lens offering for first time wearers so they pay $69 for their first fitting and teaching consultation and they leave with a month’s supply of lenses.”
Mr. Whelan said contact lens sales are important to Big W Vision’s growth strategy. “I believe we can grow the contact lens business to 10 per cent,”he told mivision.
Luxottica was not as forthcoming with its figures as Big W Vision and Specsavers but Emma Quigley, Lens Category Strategy and Sourcing Manager at OPSM said contact lenses “form an integral part of the overall OPSM business strategy”. She said the company’s highest contact lens sales stores are in major metro locations. “The CBD stores in Sydney, Melbourne, Brisbane and Perth are the highest performing CL sales against total revenue. OPSM also has 20 stores that are specialists in contact lenses.”
Ms. Quigley said the company has implemented a “customer centric approach” to increasing contact lens sales in stores in New Zealand and Australia with extensive staff training, a broad range of contact lenses across all suppliers on offer; a “simplified and improved online experience” and “new technology that gives customers greater fit and comfort”.
She said OPSM is looking to grow the contact lens segment in Australia and New Zealand, “not only in the everyday disposable range, but also in the speciality range for complex fits for eye conditions such as keratoconus, corneal grafts and high scripts. OPSM has also recently added orthokeratology technology as an option in selected stores across Australia and New Zealand”.
A Commitment to Training
Specsavers, Luxottica and Big W all acknowledged their commitment to training staff in fitting. Specsavers training program sees all floor teams trained to two levels of contact lens fitting and assistance. As a consequence, “there is now a deep knowledge among our teams of the health and lifestyle benefits of contact lenses – and our optometrists and dispensers now make a point of talking to literally every patient and customer about them,” said Mr. Larsen. “Provision of knowledge to patients is the key both from an optometry and dispensing perspective.”
Competing with Online
Mr. Larsen said the development of online contact lens selling complements Specsavers’ instore services and enables the franchises to “compete head-on with the pure-play online contact lens providers”.
“We all know that customers are time poor and they will take up convenience if it is offered to them. So now, every store’s customers can order and top up their supply of contact lenses online if they choose, or in-store if they choose. The results speak for themselves and we have seen a great migration to the online option. However, that online buyer also knows they can drop into their local Specsavers store at any time if they have any issues with fit or dry eye or whatever it may be – and they can consult on the spot. It’s the best of both worlds.”
Similarly at OPSM, Ms. Quigley said the ecommerce site opsm.com.au supports OPSM’s bricks and mortar business, with free 1 – 2 day delivery of contact lenses and free returns for all contact lens purchases. On offer are 15 brands of clear contacts and a range of coloured lenses as well.
With OPSM’s global contact lens share of sales currently sitting at 19 per cent of overall revenue, Ms. Quigley believes there is plenty of potential to build market share in Australia.
And, according to Mr. Larsen at Specsavers, the time is right for any practise owner – whether a corporate, or an independent – to give contact lenses an extra push. “There is no doubt that for many patients contact lens wear – once personally tried and tested – is the preferred form of eyewear. There are comfort, health and lifestyle factors all jostling for position. Now there is real value in the market and an opportunity for optometrists in all forms of practice to build a significant contact lens practice. So it is important for patients and customers and it is important that optometrists are the lead suppliers and dispensers of contact lenses. The demand is clearly there.”
