5+1 = INNOVATION? Check out how this company is leading the future of the eyewear industry! [Monday: Marketing Marvels]
Vision is regarded as the most dominant of all the body’s senses.
It plays a central role in one’s life―throughout every stage of life.
However, eye conditions that lead to vision impairment are common, especially as people grow older.
According to the US National Center for Health Statistics, most people who live past 50 years old are more likely to suffer from vision impairment often caused by cataracts, harmful ultraviolet rays, macular degeneration, glaucoma, and diabetic retinopathy.
It’s a good thing that different experts and companies in the medical field continue to do everything they can to prevent and cure the eye problems stated above!
One of the companies that seeks to champion eye health through innovative eyewears?
EssilorLuxottica is an Italian-French multinational corporation that was formed from the merger of the Italian eyewear company, Luxottica, and the French ophthalmics company, Essilor.
The combined company designs, produces, and markets ophthalmic lenses, optical equipment, prescription glasses, and sunglasses.
EssilorLuxottica is known for managing an extensive portfolio of prestigious brands such as:
- Oliver Peoples
- Alain Mikli Eyeglasses
Aside from that, the company has license to produce eyewear for many of the world’s most fashionable designer brands including:
- Giorgio Armani
- Dolce & Gabbana
- Ralph Lauren
- Paul Smith
What are some of the things that help EssilorLuxottica become one of the dominant players in the global eyewear market?
The 5+1 Strategic Innovation Pillars!
EssilorLuxottica’s mission is to help people “see more, be more, and live life to the fullest.” Its goal is to create innovations that correct, protect, and frame the beauty of the eyes.
With this in mind, the leadership team set up the “5+1” principles that enable the company to provide “only the best eyewear products for customers.”
Creating solutions that combine branded frames and lenses.
EssilorLuxottica knows that when it comes to eyewear, both health and style are important for consumers.
“Personal style appears to be more important than trendiness.”
Why did the brand say so?
It’s because comfort and fashion are both must-have eyewear product features. Likewise, a strong branding appeals more to customers!
This is a complete end-to-end system for the company―combining frame and lens designs with the needs, wants, and lifestyles of its target market.
It’s also in this pillar that EssilorLuxottica is developing technologies to correct and control the progression of myopia, a.k.a. nearsightedness.
The company’s top 10 key markets for combined eye health and style are Brazil, China, South Korea, Middle East, Colombia, India, Indonesia, Mexico, Russia, and Turkey.
Boosting growth in sun lenses through the Sun 2.0 category.
With Essilor and Luxottica’s combined portfolios of premium sunglass brands, there’s a substantial amount of technological know-how in the sun lens category.
Here, the company’s focus is on developing specific lens treatments to address inconveniences like glare and provide complete eye protection against natural and artificial elements.
EssilorLuxottica is constantly exploring innovation opportunities in this category with a goal to provide consumers with a wide array of options for prescription sunglasses.
This is one of the areas where the company has the highest potential to introduce significant innovations in the market.
Developing smart eyewears.
At present, EssilorLuxottica is leading digital transformation in the optics industry.
In 2019, the company developed an electrochromic technology that can manage up to 90% of light transmission within seconds and allows for the control and filtering of various forms of light such as visible light, UV (ultraviolet) rays, and IR (infrared radiation)!
This innovation offers a real solution in providing premium vision and comfort under diverse lighting and temperature conditions.
Another example is the Advanced Vision Accuracy (AVA), which is EssilorLuxottica’s breakthrough technology of high-precision vision.
The AVA features refraction technology, innovative user-friendly intelligence, and advanced lenses―suitable for eye care professionals in delivering the precision their patients deserve.
This also makes the overall experience better for customers!
EssilorLuxottica started testing AVA in Europe and America, with a forward-looking goal to launch the solution in different countries in the coming years.
Additionally, the company is working on contributions to artificial intelligence (AI), augmented reality (AR), and virtual reality (VR) in the optics industry.
Maintaining a common process and product platform despite the merger.
Essilor and Luxottica may have merged, but the business processes and platforms of the two separate entities remain the same.
This means that both groups have plenty of room to benefit and learn from each other’s expertise and technologies!
According to Francesco Milleri, CEO of EssilorLuxottica:
“Our vast combined technology portfolio helps drive the group’s productivity, quality, and product performance.”
Here, we can see that the merger is a really good move for both companies!
Providing fun and unique experiences for kids and youth.
According to EssilorLuxottica’s market research, the youth segment remains “either partially or completely underserved in rural markets.”
One of the things the company did to change this setup?
It created a unique and fun experience for children and youth while adapting to their changing lifestyles, habits, and design expectations!
The Ray-Ban Kids eyewear line…
… the Oakley Youth product line…
… and the Vogue Junior eyewear category.
By creating product lines that cater to children and youth, EssilorLuxottica showed its commitment to guide young consumers in approaching the right eyewear solutions!
+1. Putting sustainability in action.
As it introduces different products each year, EssilorLuxottica makes sure that sustainability is integrated into its daily practices to amplify its positive impact as an organization.
Below are some of the things the company does in the “+1” pillar:
– Doing more with less.
– Leveraging local resources and low-impact materials.
– Optimizing product life cycles and go-to market phases.
– Investing in cutting-edge technologies.
Through these steps, EssilorLuxottica demonstrates that it is a sustainable company that innovates responsibly.
Aside from the “5+1” strategy, what’s another thing that helped position the company as a leader in the eye care industry and promote their products?
The “See more. Do more.” Campaign!
Launched in 2019, the campaign is aimed at both eye care professionals and customers.
For Eye Care Professionals:
As a link between EssilorLuxottica and consumers, eye care professionals play an important role in transforming the industry.
Through the campaign, the company reconfirmed experts’ positions by allowing them to enhance the effectiveness of their customer service and broaden the reach of their messages via innovative eyewear technologies.
EssilorLuxottica also created an array of B2B (business-to-business) resources to help experts further understand the brand’s offer.
The guiding principle behind the “See more. Do more.” campaign was to show consumers that with EssilorLuxottica, they are using not only a corrective lens but also one that’s adapted to their lifestyle.
The campaign is all about “improving lives by improving sight,” since better vision provides greater day-to-day fulfillment and helps people pursue their passions in life.
To raise awareness and reach its target market, EssilorLuxottica promoted the brand activation across all consumer contact points―TV, social media, outdoor advertising, and point-of-sale (POS) displays and websites.
In the past five years, EssilorLuxottica SA has recorded revenues of:
- EUR 7.1 billion in 2016
- EUR 9.2 billion in 2017
- EUR 10.8 billion in 2018
- EUR 17.4 billion in 2019
- EUR 14.4 billion in 2020
Clearly, the 5+1 Strategic Innovation Pillars and the “See more. Do more.” campaign in 2019 proved effective as the company recorded higher revenues in the same year.
EssilorLuxottica SA’s Earning Power: Valens Research vs. As-reported numbers
EssilorLuxottica SA (EL:FRA) makes for a great case study that we come back to regularly. One great reason?
The company has proven itself to be a better earning power generator than investors might think.
So, how well has EssilorLuxottica been growing its business in the past years?
The research doesn’t lie—nor do the results. Earning power (the blue bars) continues to show results higher on average than what traditional databases show.
The blue bars in the chart above represent EssilorLuxottica’s earning power (Uniform Return On Assets). EssilorLuxottica has seen generally robust profitability. Its Uniform ROA ranged from 16% to 34% in the past sixteen years, or an average of 25%. Uniform ROA is at 20% in 2020.
The global ROA is just 6%.
The orange bars are the company’s as-reported financial information. If you relied on these numbers, you will see a company with terribly understated profitability. As-reported ROA (return on assets, a measure of earning power) only ranged from 1% to 10% in the past sixteen years. Its ROA in 2020 was only at 1%, which is far lower than its Uniform ROA in 2020.
That’s what you’ll see in Yahoo Finance, Google Finance, and most other databases.
The company’s stock price also performed better than the rest of the stock market over the decade, which we can see in the blue line in the chart below. Its returns have been well above the market.
The numbers show that EssilorLuxottica has been doing well and making a profit.
As stated in the company’s website, lack of awareness and access to good-quality eye care have led to a global vision crisis for billions of people.
That inspires EssilorLuxottica to consistently work towards meeting the changing lifestyles of consumers and inventing new ways to reach billions of people who suffer from uncorrected poor eyesight.
Through strong research, innovation, and the commitment to help and provide for their target market, the company is determined to introduce a digital eyewear revolution that reinforces the importance of vision―throughout every stage of life.
About The Dynamic Marketing Communiqué’s
“Monday Marketing Marvels”
Too often, industry experts and the marketing press sing the praises of some company’s marketing strategy.
…Only for the audience to later find out that their product was a flop, or worse, that the company went bankrupt.
The true ROI in marketing can’t be separated from the business as a whole.
What good is a marketing case study if one can’t prove that the company’s efforts actually paid off?
At the end of the day, either the entire business is successful or it isn’t. And the role of marketing is always paramount to that success.
Every Monday, we publish a case study that highlights the world’s greatest marketing strategies.
However, the difference between our case studies and the numerous ones out there, is that we will always make certain that the firm really did generate and demonstrate earning power worthy of study in the first place (compliments of Valens Research’s finance group).
By looking at the true earnings of a company, we can now rely on those successful businesses to get tips and insights on what they did right.
We’ll also study the greatest marketing fails and analyze what they did wrong, or what they needed to improve on. We all make our mistakes, but better we learn from others’ mistakes—and earlier, rather than later.
Hope you found this week’s marketing marvel interesting and helpful.
Stay tuned for next week’s Monday Marketing Marvels!
Head of Marketing
Valens Dynamic Marketing Capabilities
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