EYES ON THE PRIZE
Glasses are a multi-billion
euro global business
and one that Europe
continues to dominate.
Boyd Farrow reports
The dollar-rich European shoppers and
lunch-grabbing locals enjoying the
unusually warm New York weather last
October were bemused by a new store
at the corner of Spring and Wooster Streets in
fashionable SoHo.
The main windows of Ilori offered few clues:
only sheets of opaque glass on to which images of
fire, volcanoes and the occasional phoenix were
projected. Those venturing inside the 4,500 sq ft
former Movado watches emporium would have
discovered not some Siegfried & Roy magic
extravaganza but an eyewear boutique, displaying
more than 1,400 styles of sunglasses arranged
like an art gallery. Beyond the usual designer
brands and the even pricier trendsetting lines
were display cases housing gem-studded '€700-
plus frames. Underneath this aquarium-cumnightclub
is a lounge where VIPs can enjoy drinks
and chocolates as they check their reflections.
Reportedly coming soon are '€16,000 sunglasses
to enchant sheiks or rappers. A prickly PR girl
points out that anything costing more than
$1,000 ('€680) will not display a price tag.
Price is a particularly sensitive issue around
here. Ilori is the new US flagship of Luxottica,
the Milan-based global eyewear giant which is
currently attempting to persuade Americans '
who represent a '€1.36bn market ' that expensive
sunglasses are as essential a luxury as designer
bags and shoes. Whereas more than 90% of
Europeans spend more than '€30 on a pair of
shades, in the US 70% of frames cost less than
'€20. Luxottica already has one of its 5,000-plus
Sunglass Hut outlets on West Broadway, a 60-
second sashay from Ilori, but the latter is a
statement directed at another upmarket
sunglasses outlet, Solstice, on nearby Mercer
Street. Solstice is owned by Luxottica's arch-rival
Safilo, which is also headquartered in north Italy.
The sums involved in the eyewear business
are truly eye-popping. Last November, Luxottica
recorded a net profit for the third-quarter of 2007
of '€112m, a 5% rise year-on-year, as turnover
rose 2.7% to '€1.15bn (up 8% at constant currency
rates). Quarterly retail sales, flat at '€838m, would
have been up 6.4% at constant exchange rates.
Turnover for 2008 is predicted to be '€5.7bn.
While the company still does 85% of its
production in the Belluno province in order
to cash in on the lucrative 'Made in Italy' tag
(it has two manufacturing plants in China), more
than 95% of its sales are abroad. The big earner
is its own brands: Ray-Ban sunglasses, acquired
in 1999, accounted for 15% of the group's sales
in 2006. Last November Luxottica acquired the
US sports eyewear company Oakley for '€1.4bn.
It also produces under license for Chanel, Prada,
Bulgari and many other sparkling names. In
December it launched a Tiffany & Co eyewear
collection. Three months earlier Luxottica chief
executive Andrea Guerra called the US 'the
biggest emerging market for luxury goods.'
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