Optical Goods Retailing - UK - February 2020

OVERVIEW
What you need to know
Products covered in this Report
Excluded
EXECUTIVE SUMMARY
The market
Steady market growth
Figure 1: Consumer spend on optical goods and services, 2014-24
Sunglasses are a fashion item
Spectacles account for more than 60% of spend
Figure 2: Consumer spend on optical goods and services, by category, 2019 (est)
Companies and brands
Big three opticians capture 71% of spend
Figure 3: Opticians retailers, market share, 2019 (est)
Specsavers has opened its 900th store
Tesco acquisition boosts Vision Express’ store numbers
Hakim has doubled store numbers in two years
Other opticians with ambition for growth
Virtual try-on will boost internet sales
New look for Boots Opticians
Photochromic contact lenses
Future product developments
Specsavers and Boots brands enjoy high levels of trust
Figure 4: Attitudes towards and usage of selected brands, December 2019
The consumer
71% had eye tests in the last two years
Figure 5: Eye tests, contact lens appointments and hearing tests in the last two years, December 2019
9% have had laser eyesight correction
35% wear, or have ever worn, contact lenses
Figure 6: Experience of wearing contact lenses, December 2019
Discomfort is the key reason for opting out of contact lenses
Figure 7: Reasons for stopping wearing contact lenses, December 2019
High level of purchasing activity
Figure 8: Eyewear and hearing aids purchased in the last two years, December 2019
Specsavers is the most used optician
Independents appeal to over-55s
Figure 9: Retailers used for glasses and prescription sunglasses bought in the last two years, December 2019
Specsavers captures 39% of contact lens shoppers
Internet specialists popular for contact lenses
Figure 10: Retailers used for contact lenses bought in the last two years, December 2019
Multi-layered choice process
Over-65s aware of healthcare
Figure 11: Factors influencing choice of opticians, December 2019
Healthcare plays an important role
Personal service is a key feature
Internet savings can be a draw
Figure 12: Attitudes towards opticians, December 2019
What we think
ISSUES AND INSIGHTS
Online selling is building momentum
The facts
The implications
New wave of opticians with personality and a DTC model
The facts
The implications
What is the relevance of supermarkets in optics?
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Ageing population fuels market growth
12% growth forecast for sunglasses between 2019 and 2024
Glasses account for 61% of spend
Innovation has added value
Three major chains dominate the UK opticians sector
Internet specialists growing
Population growth and healthy finances
2019 not as sunny as the previous year
MARKET SIZE AND FORECAST
Steady growth for optical goods and services
Figure 13: Consumer spending on optical goods and services, 2014-24
12% growth forecast for sunglasses between 2019 and 2024
Figure 14: Consumer spending on non-prescription sunglasses, 2014-24
Forecast methodology
MARKET SEGMENTATION
Spectacles are the main element of the optical goods market
Figure 15: Consumer spending on optical goods and services, by category, 2019 (est)
Optical goods market by category
Figure 16: Consumer spending on optical goods and services, 2014-19
Innovative lenses help grow the spectacles market
Figure 17: Spectacle lens purchases, by type, (numbers) 2019 (est)
Contact lens market up by 20.5% from 2014-19
Multifocal contact lenses grow market value
Toric contact lenses have broadened the market
Rise of daily-wear lenses means lower demand for solutions
25% of contact lens wearers are part-time
Market dominated by soft contact lenses
Eye drops growing strongly from a small base
Eye examination numbers growing gradually
Figure 18: Yearly change in number of NHS eye examinations, England and Wales, 2014-18
CHANNELS TO MARKET
Three major chains dominate the UK market
Figure 19: Distribution of optical goods and services, by retailer, 2018 and 2019 (est)
MARKET DRIVERS
Ageing population drives growth
Growth in the teenage market
Figure 20: Trends in the age structure of the UK population, 2019-24
Consumers remain confident about their finances
Figure 21: Trends in how respondents would describe their financial situation, January 2018-December 2019
Sunshine helps to sell sunglasses
Figure 22: Sunshine hours, by season, 2014-19
Overseas travel helps build sunglasses sales
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
Specsavers has opened its 900th store
Overseas owners
Tesco acquisition boosts Vision Express’ store numbers
Hakim has doubled store numbers in two years
Other opticians with ambition for growth
Virtual try-on will boost internet sales
New look for Boots Opticians
Photochromic contact lenses
Future product developments
Specsavers and Boots brands enjoy high levels of trust
COMPANIES AND BRANDS
Specsavers is by far the largest group
Figure 23: Leading optical goods retailers’ net revenues (excluding VAT), 2014-18
Tesco acquisition boosts Vision Express’ store numbers
Figure 24: Leading optical goods retailers’ outlet numbers, 2015-19
Other chains
Hakim has doubled store numbers in two years
Royston Bayfield aims for 50 outlets
Other small chains
Opticians with ‘fair pricing’
Key developments in online selling
Contact lenses online
Daysoft develops a DTC model
Figure 25: Daysoft, 2020
Essilor takes a major position in digital selling
Several online sellers of glasses
Some 20% of fashion sunglasses are bought online
Amazon is selling online in Germany
COMPETITIVE STRATEGIES
Slowdown in acquisition activity as the market concentrates
Why be inside a supermarket?
Specsavers expands into healthcare provision
Online presence for opticians serves a wide span of purposes
How the key retailers differentiate their brands
Disruptive strategies from smaller players
LAUNCH ACTIVITY AND INNOVATION
Virtual try-on for spectacles and sunglasses
Figure 26: Specsavers, Frame Styler, 2020
Bespoke eyewear will grow in popularity
Figure 27: Tom Davies, Bespoke glasses, 2020
Boots develops a new look
Figure 28: Boots Opticians, revamped Covent Garden store, 2019
Three examples of opticians ‘re-inventing’ opticians
Ace & Tate opening its ninth store
Figure 29: Ace & Tate, Comparing the industry with own production, 2020
Figure 30: Ace & Tate, Glasgow store interior, 2020
Ollie Quinn offers ‘fair prices’
Figure 31: Ollie Quinn, Brighton, 2020
Bailey Nelson now has two UK stores
Figure 32: Bailey Nelson, Old Spitalfields Market, 2020
A photochromic contact lens
Figure 33: Johnson & Johnson, photochromic contact lens, 2020
More examples of contact lens innovation
Delivering medication to the eye
Glucose monitoring without a finger prick
Print contact lenses at home or in-store
Zoom in with contact lenses
Heads-up displays on your contact lenses
More examples of spectacle innovation
Glasses that adjust focus automatically
We are yet to see commercial smart glasses
ADVERTISING AND MARKETING ACTIVITY
Steady spending on advertising over 2018-19
Figure 34: Total above-the-line, online display and direct mail advertising expenditure on opticians, 2015-19
Specsavers dominates the advertising landscape
Figure 35: Optical goods advertisers’ above-the-line, online display and direct mail advertising expenditure, 2019*
Specsavers consistently spends more than competitors
Figure 36: Top five optical goods advertisers,  above-the-line, online display and direct mail advertising expenditure, 2015-19
Television and direct mail dominate spending
Figure 37: Advertising spend by opticians, by media, 2019*
Nielsen Ad Intel coverage
BRAND RESEARCH
Brand map
Figure 38: Attitudes towards and usage of selected brands, December 2019
Key brand metrics
Figure 39: Key metrics for selected brands, December 2019
Brand attitudes: Asda Opticians value differentiates the brand
Figure 40: Attitudes, by brand, December 2019
Brand personality: Specsavers is fun
Figure 41: Brand personality – macro image, December 2019
Specsavers is reliable and welcoming
Figure 42: Brand personality – micro image, December 2019
Brand analysis
Specsavers is a true mass-market brand
Figure 43: User profile of Specsavers, December 2019
Vision Express captures higher earners
Figure 44: User profile of Vision Express, December 2019
David Clulow’s customers are wealthy and young
Figure 45: User profile of David Clulow, December 2019
Boots Opticians appeals to an upscale audience
Figure 46: User profile of Boots Opticians, December 2019
Asda Opticians is regarded as basic
Figure 47: User profile of Asda Opticians, December 2019
THE CONSUMER – WHAT YOU NEED TO KNOW
71% had an eye test in the last two years
13% are regular contact lens wearers
High level of purchasing activity
Specsavers is a dominant force for glasses
22% of contact lens shoppers bought through online specialists
Price, quality and convenience influence choice of optician
People recognise the importance of check-ups
Opticians have an opportunity to expand the contact lens market
Spectacles influenced by style and brands
Loyalty is fragile
EYE TESTS, CONTACT LENS APPOINTMENTS AND HEARING TESTS 
71% had eye tests in the last two years
Figure 48: Eye tests, contact lens appointments and hearing tests in the last two years, December 2019
LASER VISION CORRECTION
9% have had laser eyesight correction
Figure 49: Ever had laser surgery to correct vision, by age, December 2019
CONTACT LENS WEAR
35% wear, or have ever worn, contact lenses
Figure 50: Experience of wearing contact lenses, December 2019
Discomfort is the key reason for opting out of contact lenses
Figure 51: Reasons for stopping wearing contact lenses, December 2019
PURCHASES OF EYEWEAR AND HEARING AIDS
High level of purchasing activity
Figure 52: Eyewear and hearing aids purchased in the last two years, December 2019
Older bias towards spectacles shoppers
Figure 53: Prescription glasses purchased in the last two years, by age, December 2019
Younger bias towards contact lens shoppers
Figure 54: Prescription contact lenses purchased in the last two years, by age, December 2019
RETAILERS USED FOR GLASSES AND PRESCRIPTION SUNGLASSES 
Specsavers is the most used optician
Independents appeal to over-55s
Figure 55: Retailers used for glasses and prescription sunglasses bought in the last two years, December 2019
RETAILERS USED FOR CONTACT LENSES
Specsavers captures 39% of contact lens shoppers
Internet specialists popular for contact lenses
Figure 56: Retailers used for contact lenses bought in the last two years, December 2019
FACTORS INFLUENCING CHOICE OF OPTICIANS
Multi-layered choice process
Convenience is key
Over-65s aware of healthcare
Figure 57: Factors influencing choice of opticians, December 2019
ATTITUDES TOWARDS OPTICIANS
People recognise the importance of check-ups
Opticians have an opportunity to expand the contact lens market
Brands carry a premium
Figure 58: Attitudes towards opticians, contact lenses, December 2019
Style adds value in the market for spectacles
Brands matter more to male shoppers
Figure 59: Attitudes towards opticians, glasses style and brand, December 2019
The value of personal fitting
Independents have a strong image for healthcare
Figure 60: Attitudes towards opticians, fitting and independents, December 2019
Loyalty is a thing of the past
Competing with internet sellers
Young adults like the idea of self-testing eyes
Figure 61: Attitudes towards opticians, internet retailing, December 2019
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology
APPENDIX – MARKET SIZE AND FORECAST
Forecast methodology