“What really knocked me out was the cheap sunglasses!” ZZ Top
Is Warby Parker on your radar screen? It’s an easy model to disparage.
We can whistle past the graveyard and say, “Well, there’s no customer service, frames are cheap, and lenses are cheaper. Their charitable donations are a hoax.”
These are the familiar refrains from those of us in the conventional optical business.
Have you seen the recent spate of Warby Parker commercials? Two elements in these TV ads are especially compelling. One of the ads features a lab technician polishing a frame before it is packaged and shipped. Professionalism, quality, and style are conveyed by the voice-over. The other ad piece features a bunch of dancing. Dancing in the streets, dancing on the front porch, etc. Why? The central character just got a message that his Warby Parker glasses were being shipped. Hand-polished, and five pairs to try for free? Where do I sign?
Is there a teaching moment here? Do YOU convey quality, style, and all-important enthusiasm that Warby has shown in these highly polished ads?
Another common refrain from our camp is, “See, they are failing, so they had to open bricks-and-mortar stores.” Eh, not really.
Warby is making a classic play for synergy, with online and in-person shopping in concert.
Nordstrom has done a remarkable job on this, with salesperson connectivity that produces answers on product quality and availability as never before. A Nordstrom employee can determine access to a product with a few taps on the hand-held tablet, thus providing customer satisfaction and unparalleled control of inventory. The wonderful retailer Lord and Taylor have not approached this level of service, and they are shrinking as a result.
An affluent patient of mine said it best. “I’d rather pay $400 for four pairs of Warby Parkers than $400 for one pair of YOURS. One of them is going to work fine.” Glasses have taken on a disposable status, as patients have become aware of high markups, and question the incremental increase in quality.
Warby claims to be making money. As a privately held company, they are clearly angling for a strong “Initial Public Offering” or takeover at some point. While the private status indicates that they don’t have to make financial disclosure, it is clear that investors believe the story. They also claim to have given away four million pairs of glasses, which has special appeal for Millennial customers.
A great New York Times article on co-founder Jeff Raider can give more insight into Warby Parker. (See footnote.) Mr. Raider asserts that this University of Pennsylvania’s Wharton School of Business MBA project was aimed to make things easy for the consumer, as well as to help avoid the “pain” of purchasing upscale glasses. (As an undergrad at Penn, I was impressed by the “boot camp” aspect of these programs. Students work in teams to design businesses from the ground up, with consideration of accounting, finance, marketing, and internet aspects. Interestingly, the Warby project lost in competition with other MBA projects!) I think that the key to Warby’s success is not so much pricing, as it is the ease with which styles can be tried and returned. Certainly, cheaper glasses are available. The notion of having five frames shipped, with no obligation, fits perfectly with the lifestyles of those Millennials.
I was curious to know how private practices were fighting back, so I enlisted the help of our Altoona, Pennsylvania colleague Michelle Saad Barnes, O.D.
Dr. Barnes takes a proactive approach. She emphasizes the safety and accuracy issues that can be problematic with online purchases. Dr. Barnes has also written a policy on remote purchases that is clearly designed to keep the patient for the long term. Dr. Barnes indicates that “For right now, I am mainly educating them, particularly about what we can and cannot do in the event that they have problems.”
Perhaps most importantly, Dr. Barnes’ third plan of attack is to feature frame lines that are interesting and unique.
There are independent, optometry-friendly frame companies that can lead to purchase by making the patient feel special. Break stride with the cookie-cutter conglomerate frames! It takes hard work and multiple visits to frame shows, but it is worth the effort.
Can we adapt, and thrive? Discounting is certainly not the answer. Our overheads make the profit margins on our “economy” lenses and frames hard to swallow. It’s a cautionary tale. My own practice fell victim to this, with unit volume that was flat-to-up, yet profits that shrunk due to too many sales of our own frame line.
A high percent profit margin on a small purchase is still a small number. Call me crazy, but most banks seem to want to deposit dollars and not percentage signs.
Can we generate the interest and enthusiasm portrayed in the Warby Parker TV ads? We can, but it takes a clear message of service and convenience. Sales training for staff is readily available through frame, lens, and contact lens companies. We ignore sales expertise at our own peril, as Warby’s online presence lacks one major feature, that of the personal touch in selecting eyewear. We have to believe in this model, or it will all go away.
Footnote: Gelles, David, “The Billion Dollar Company Touch,” The New York Times (hard copy), Sunday, November 4, 2018, Sunday Business section, page 3.