Luxottica Group S.p.A. is an Italian
eyewear
Eyewear consists of items and accessories worn on or over the eyes, for fashion or adornment, protection against the environment, and to improve or enhance visual acuity.
Common forms of eyewear include glasses (also called ''eyeglasses'' or ''s ...
conglomerate and the world's largest company in the eyewear industry. It is based in
Milan
Milan ( , , Lombard: ; it, Milano ) is a city in northern Italy, capital of Lombardy, and the second-most populous city proper in Italy after Rome. The city proper has a population of about 1.4 million, while its metropolitan city h ...
,
Italy
Italy ( it, Italia ), officially the Italian Republic, ) or the Republic of Italy, is a country in Southern Europe. It is located in the middle of the Mediterranean Sea, and its territory largely coincides with the homonymous geographical re ...
.
Luxottica is a
vertically integrated
In microeconomics, management and international political economy, vertical integration is a term that describes the arrangement in which the supply chain of a company is integrated and owned by that company. Usually each member of the supply ...
company, which has been described as a
monopoly
A monopoly (from Greek language, Greek el, μόνος, mónos, single, alone, label=none and el, πωλεῖν, pōleîn, to sell, label=none), as described by Irving Fisher, is a market with the "absence of competition", creating a situati ...
—it designs, manufactures, distributes, and retails its eyewear brands through companies such as
LensCrafters,
Sunglass Hut, Apex by Sunglass Hut,
Pearle Vision,
Target Optical, and Glasses.com. It also owns EyeMed, one of the largest vision
health insurance
Health insurance or medical insurance (also known as medical aid in South Africa) is a type of insurance that covers the whole or a part of the risk of a person incurring medical expenses. As with other types of insurance, risk is shared among ma ...
providers. Its best known brands are
Costa,
Ray-Ban
Ray-Ban is an American-Italian brand of luxury sunglasses and eyeglasses created in 1936 by Bausch & Lomb. The brand is known for its Wayfarer and Aviator lines of sunglasses. In 1999, Bausch & Lomb sold the brand to Italian eyewear conglomerate ...
,
Persol,
Oliver Peoples
Oliver Peoples is an American luxury eyewear brand established in 1986, and owned by Luxottica. The brand is sold in Oliver Peoples boutiques, online, and in fashion boutiques and department stores throughout the world. Oliver Peoples eyewear is ...
and
Oakley. Luxottica's
market power
In economics, market power refers to the ability of a firm to influence the price at which it sells a product or service by manipulating either the supply or demand of the product or service to increase economic profit. In other words, market powe ...
has allowed it to charge price markups of 1000%.
Luxottica also makes sunglasses and prescription frames for designer brands such as
Chanel
Chanel ( , ) is a French high-end luxury fashion house founded in 1910 by Coco Chanel in Paris. Chanel specializes in women's ready-to-wear, luxury goods, and accessories and licenses its name and branding to Luxottica for eyewear. Chanel is ...
,
Prada
Prada S.p.A. (, ; ) is an Italian luxury fashion house founded in 1913 in Milan by Mario Prada. It specializes in leather handbags, travel accessories, shoes, ready-to-wear, and other fashion accessories. Prada licenses its name and branding t ...
,
Giorgio Armani
Giorgio Armani (; born 11 July 1934) is an Italian fashion designer. He first gained notoriety working for Cerruti and then for many others, including Allegri, Bagutta and Hilton. He formed his company, Armani, in 1975, which eventually expande ...
,
Burberry,
Versace
Gianni Versace S.r.l. (), usually referred to as Versace ( ), is an Italian luxury fashion company founded by Gianni Versace in 1978 known for flashy prints and bright colors. The company produces Italian-made ready-to-wear and accessories, as w ...
,
Dolce and Gabbana
Dolce & Gabbana (), also known by initials D&G, is an Italian luxury fashion house founded in 1985 in Legnano by Italian designers Domenico Dolce and Stefano Gabbana. The house specializes in ready-to-wear, handbags, accessories, and cosmetic ...
,
Michael Kors
Michael David Kors (born Karl Anderson Jr. August 9, 1959) is an American fashion designer. He is the chief creative officer of his brand, Michael Kors, which sells men's and women's ready-to-wear, accessories, watches, jewelry, footwear, and f ...
,
Coach
Coach may refer to:
Guidance/instruction
* Coach (sport), a director of athletes' training and activities
* Coaching, the practice of guiding an individual through a process
** Acting coach, a teacher who trains performers
Transportation
* Co ...
,
Miu Miu and
Tory Burch.
In January 2017, Luxottica announced a merger with
Essilor. The combined entity would command more than one quarter of global value sales of eyewear.
In March 2018, the European Commission unconditionally approved the merger of Essilor and Luxottica. On 1 October 2018, the new holding company
EssilorLuxottica was born, resulting in combined
market capitalization
Market capitalization, sometimes referred to as market cap, is the total value of a publicly traded company's outstanding common shares owned by stockholders.
Market capitalization is equal to the market price per common share multiplied by t ...
of approximately $70 billion.
History
Leonardo Del Vecchio started the company in 1961, in
Agordo
Agordo ( Local Ladin: ''Agort'', Ladin: ''Ègort'', Austrian German: ''Augarten'') is a town and ''comune'' (municipality) sited in the Province of Belluno, in the Veneto region in Italy. It is located about north of Venice and about northwest ...
north of
Belluno
Belluno (; lld, Belum; vec, Belùn) is a town and province in the Veneto region of northern Italy. Located about north of Venice, Belluno is the capital of the province of Belluno and the most important city in the Eastern Dolomites region ...
,
Veneto
Veneto (, ; vec, Vèneto ) or Venetia is one of the 20 regions of Italy. Its population is about five million, ranking fourth in Italy. The region's capital is Venice while the biggest city is Verona.
Veneto was part of the Roman Empire unt ...
; today the company is headquartered in
Milan
Milan ( , , Lombard: ; it, Milano ) is a city in northern Italy, capital of Lombardy, and the second-most populous city proper in Italy after Rome. The city proper has a population of about 1.4 million, while its metropolitan city h ...
, Italy.
Del Vecchio began his career as the apprentice to a tool and diemaker in Milan, but decided to turn his metalworking skills to making spectacle parts. So in 1961, he moved to Agordo in the
province of Belluno
The Province of Belluno ( it, Provincia di Belluno; de-AT, Provinz Belluno; lld, Provinzia de Belum) is a province in the Veneto region of Italy. Its capital is the city of Belluno.
It has an area of and a total population of about 205,000.
...
, which is home to most of the Italian eyewear industry.
The new company was Luxottica s.a.s., a limited partnership with Del Vecchio as one of the founding partners.
In 1967, he started selling complete eyeglass frames under the Luxottica brand, which proved successful enough that by 1971 he ended the contract manufacturing business.
Convinced of the need for
vertical integration
In microeconomics, management and international political economy, vertical integration is a term that describes the arrangement in which the supply chain of a company is integrated and owned by that company. Usually each member of the suppl ...
, in 1974, he acquired Scarrone, a distribution company.
In 1981, the company set up its first international subsidiary, in Germany, the first in a rapid period of international expansion.
The first of many licensing deals with a designer was struck with Armani, in 1988.
The company listed in New York in 1990, and in Milan in December 2000, joining the MIB-30 (now
FTSE MIB) index in September 2003. The listing raised money for the company and allowed it to use its shares to acquire other brands, starting with Italian brand Vogue Eyewear in 1990,
Persol and the
United States Shoe Corporation The United States Shoe Corporation (also known as U.S. Shoe) was a retailing conglomerate headquartered in Cincinnati, Ohio, that operated several retail chains and brands mostly in the fields of shoes, clothing and optical.
History
U.S. Shoe's his ...
(LensCrafters) in 1995, Ray-Ban in 1999 and Sunglass Hut, Inc. in 2001.
Luxottica later increased its presence in the retail sector by acquiring
Sydney
Sydney ( ) is the capital city of the state of New South Wales, and the most populous city in both Australia and Oceania. Located on Australia's east coast, the metropolis surrounds Sydney Harbour and extends about towards the Blue Mountain ...
-based
OPSM in 2003,
Pearle Vision and Cole National in 2004.
Luxottica acquired
Oakley in November 2007 for US$2.1 billion. Oakley had tried to dispute their prices because of Luxottica's large marketshare, and Luxottica responded by dropping Oakley from their stores, causing their stock price to drop, followed by Luxottica's
hostile take over
In business, a takeover is the purchase of one company (law), company (the ''target'') by another (the ''acquirer'' or ''bidder''). In the UK, the term refers to the acquisition of a public company whose shares are listed on a stock exchange, in ...
of the company. In August 2011, Luxottica acquired Erroca for €20 million. In March 2014, it was announced that Luxottica would partner with Google on the development of
Google Glass
Google Glass, or simply Glass, is a brand of smart glasses developed and sold by Google. It was developed by X (previously Google X), with the mission of producing an ubiquitous computer. Google Glass displays information to the wearer using ...
and its integration into Luxottica's eyewear.
Essilor bought Daytona Beach, FL, based Costa, Inc. in 2013 and the popular brand of premium sunglasses was integrated into the Luxottica system in 2020. The approximately $270 million all-cash transaction was 2.8 times Costa's revenues from continuing operations for the trailing 12 months – a very rich valuation that approaches what Oakley received when it was acquired by Luxottica during the height of the M&A market in 2007. Luxottica has shut down Costa's headquarters, warehousing and shipping operation in Daytona Beach. About 295 employees will be let go. Costa sunglasses will be manufactured at Luxottica's plant in
Foothill Ranch
Foothill Ranch is a master planned community in Orange County, California, United States. The population was 10,899 at the 2000 census. Foothill Ranch was incorporated into the city of Lake Forest, California, in 2000. Prior to that, it was a ce ...
, California.
On 1 September 2014, a new organizational structure was announced, composed of two co-CEOs, one focusing on market development and the other overseeing corporate functions. After the exit of former CEO
Andrea Guerra, Enrico Cavatorta was appointed CEO of Corporate Function and Interim CEO of Market (until new and permanent appointment to this role). Cavatorta left the company 40 days after being appointed CEO. In 2016, it was reported that Luxottica had lost its third chief executive in a year and a half, as Adil Mehboob-Khan stepped down a year after he replaced Cavatorta.
In January 2017, the company agreed to a merger with
Essilor. The deal also offered a succession plan for Leonardo Del Vecchio, the company's founder. Shortly before the merger completed, reporter Sam Knight wrote in ''
The Guardian
''The Guardian'' is a British daily newspaper. It was founded in 1821 as ''The Manchester Guardian'', and changed its name in 1959. Along with its sister papers ''The Observer'' and ''The Guardian Weekly'', ''The Guardian'' is part of the Gu ...
'', "in seven centuries of spectacles, there has never been anything like it. The new entity will be worth around $50bn (£37bn), sell close to a billion pairs of lenses and frames every year, and have a workforce of more than 140,000 people." On 1 October 2018 the new holding company
EssilorLuxottica was founded, resulting in combined
market capitalization
Market capitalization, sometimes referred to as market cap, is the total value of a publicly traded company's outstanding common shares owned by stockholders.
Market capitalization is equal to the market price per common share multiplied by t ...
of approximately €46.3 billion as of the date of the merger announcement.
In August 2018, Luxottica restored
Accademia Bridge in
Venice
Venice ( ; it, Venezia ; vec, Venesia or ) is a city in northeastern Italy and the capital of the Veneto Regions of Italy, region. It is built on a group of 118 small islands that are separated by canals and linked by over 400 ...
.
Eyewear brands
![Ray-Ban sunglasses](https://upload.wikimedia.org/wikipedia/commons/d/d5/Ray-Ban_sunglasses.jpg)
Luxottica's two main product offerings are sunglasses and prescription frames. The company operates in two sectors: manufacturing & wholesale distribution, and retail distribution.
The house brands include the following:
The company also makes eyewear under license for the following designer labels:
These brands are sold in the company's own shops, as well as to independent distributors such as
department store
A department store is a retail establishment offering a wide range of consumer goods in different areas of the store, each area ("department") specializing in a product category. In modern major cities, the department store made a dramatic app ...
s,
duty-free shop
A duty-free shop (or store) is a retail outlet whose goods are exempt from the payment of certain local or national taxes and duties, on the requirement that the goods sold will be sold to travelers who will take them out of the country, who ...
s, and
optician
An optician, or ''dispensing optician'', is a technical practitioner who designs, fits and dispenses lenses for the correction of a person's vision. Opticians determine the specifications of various ophthalmic appliances that will give the nec ...
s.
Retail
Luxottica Retail has about 9,100 retail locations
in the
United States
The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territorie ...
,
Latin America
Latin America or
* french: Amérique Latine, link=no
* ht, Amerik Latin, link=no
* pt, América Latina, link=no, name=a, sometimes referred to as LatAm is a large cultural region in the Americas where Romance languages — languages derived f ...
,
Canada
Canada is a country in North America. Its ten provinces and three territories extend from the Atlantic Ocean to the Pacific Ocean and northward into the Arctic Ocean, covering over , making it the world's second-largest country by tot ...
,
India
India, officially the Republic of India (Hindi: ), is a country in South Asia. It is the seventh-largest country by area, the second-most populous country, and the most populous democracy in the world. Bounded by the Indian Ocean on the so ...
,
China
China, officially the People's Republic of China (PRC), is a country in East Asia. It is the world's most populous country, with a population exceeding 1.4 billion, slightly ahead of India. China spans the equivalent of five time zones and ...
,
Australia
Australia, officially the Commonwealth of Australia, is a Sovereign state, sovereign country comprising the mainland of the Australia (continent), Australian continent, the island of Tasmania, and numerous List of islands of Australia, sma ...
,
New Zealand
New Zealand ( mi, Aotearoa ) is an island country in the southwestern Pacific Ocean. It consists of two main landmasses—the North Island () and the South Island ()—and over 700 smaller islands. It is the sixth-largest island count ...
,
South Africa
South Africa, officially the Republic of South Africa (RSA), is the southernmost country in Africa. It is bounded to the south by of coastline that stretch along the South Atlantic and Indian Oceans; to the north by the neighbouring countri ...
, the
United Kingdom
The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Europe, off the north-western coast of the continental mainland. It comprises England, Scotland, Wales and North ...
, and
United Arab Emirates
The United Arab Emirates (UAE; ar, اَلْإِمَارَات الْعَرَبِيَة الْمُتَحِدَة ), or simply the Emirates ( ar, الِْإمَارَات ), is a country in Western Asia (The Middle East). It is located at th ...
.
The headquarters of the retail division is in
Mason, Ohio, United States (
North America
North America is a continent in the Northern Hemisphere and almost entirely within the Western Hemisphere. It is bordered to the north by the Arctic Ocean, to the east by the Atlantic Ocean, to the southeast by South America and the Car ...
).
Their retail banners include the following:
Luxottica is the largest optical retailer in the United States, with 7.3% of US retail sales in 2015. With its merger with Essilor in 2018 the company owns Coastal/Clearly, an online contacts and glasses retail giant bought in 2014 that ships to over 200 countries beside its original North American market.
Medical managed care
Luxottica also owns EyeMed Vision Care, a managed vision care organization in the United States. As of 2014, it is the second-largest vision benefits company in the United States.
Philanthropy
Luxottica is affiliated with the charitable organization OneSight, formed in 1988. In March 2022, EssilorLuxottica announced the launch of the OneSight EssilorLuxottica Foundation to unify the group's philanthropic efforts, primarily providing vision services to underserved communities.
Criticism
Monopolistic pricing practices
The company has been criticized for the high price of its brand-name glasses, such as
Ray-Ban
Ray-Ban is an American-Italian brand of luxury sunglasses and eyeglasses created in 1936 by Bausch & Lomb. The brand is known for its Wayfarer and Aviator lines of sunglasses. In 1999, Bausch & Lomb sold the brand to Italian eyewear conglomerate ...
,
Oakley, and several others. A 2012 ''
60 Minutes
''60 Minutes'' is an American television news magazine broadcast on the CBS television network. Debuting in 1968, the program was created by Don Hewitt and Bill Leonard, who chose to set it apart from other news programs by using a unique styl ...
'' segment focused on whether the company's extensive holdings in the industry were used to keep prices high. Luxottica owns not only a large portfolio of brands (over a dozen
) such as
Ray-Ban
Ray-Ban is an American-Italian brand of luxury sunglasses and eyeglasses created in 1936 by Bausch & Lomb. The brand is known for its Wayfarer and Aviator lines of sunglasses. In 1999, Bausch & Lomb sold the brand to Italian eyewear conglomerate ...
and
Oakley but also retailers such as
Sunglass Hut,
Lenscrafters and
Oliver Peoples
Oliver Peoples is an American luxury eyewear brand established in 1986, and owned by Luxottica. The brand is sold in Oliver Peoples boutiques, online, and in fashion boutiques and department stores throughout the world. Oliver Peoples eyewear is ...
, the optical departments at
Target
Target may refer to:
Physical items
* Shooting target, used in marksmanship training and various shooting sports
** Bullseye (target), the goal one for which one aims in many of these sports
** Aiming point, in field artillery, fi ...
and
Sears, as well as key eye insurance groups including the second largest glasses insurance firm in the US, EyeMed. It has been accused of operating a complete monopoly on the optical industry and overcharging for its products; for example, temporarily dropping then-competitor Oakley from its frame design list, then, when the company stock crashed, purchasing the company, then increasing the prices of its Ray-Ban sunglasses. In addition, it has been argued that, by owning the vision insurance company EyeMed, it also controls part of the buyers' market as well.
The company has said that the market is highly competitive, and that their frames account for ~10% of sales worldwide and ~20% in the United States.
[ Euromonitor International estimated that Luxottica's market share was 14% worldwide, with the second-largest company in the industry, Essilor, holding a 13% market share. The third-largest player was ]Johnson & Johnson
Johnson & Johnson (J&J) is an American multinational corporation founded in 1886 that develops medical devices, pharmaceuticals, and consumer packaged goods. Its common stock is a component of the Dow Jones Industrial Average and the company i ...
, with a 3.9% market share. In October 2018, Luxottica and Essilor merged into a single company, EssilorLuxottica, which now occupies nearly 30% of the global market share and represents almost a billion pairs of lenses and frames sold annually.
The HBO series ''Last Week Tonight with John Oliver
''Last Week Tonight with John Oliver'' (often abridged as ''Last Week Tonight'') is an American late-night talk and news satire television program hosted by comedian John Oliver. The half-hour-long show premiered in April 2014 on HBO. ''Last Wee ...
'' has criticized the company as a prominent instance of corporate consolidation, as has the TruTV
TruTV (stylized as truTV) is an American basic cable channel owned by Warner Bros. Discovery. The channel primarily broadcasts comedy, docusoaps and reality shows.
The channel was originally launched in 1991 as Court TV, a network that focu ...
series '' Adam Ruins Everything''.
In 2019, LensCrafters founder E. Dean Butler spoke to the ''Los Angeles Times
The ''Los Angeles Times'' (abbreviated as ''LA Times'') is a daily newspaper that started publishing in Los Angeles in 1881. Based in the LA-adjacent suburb of El Segundo since 2018, it is the sixth-largest newspaper by circulation in the Un ...
'', admitting that Luxottica's dominance of the eyewear industry had resulted in price markups of nearly 1,000%. In the interview, Butler noted "You can get amazingly good frames, with a Warby Parker level of quality, for $4 to $8. For $15, you can get designer-quality frames, like what you'd get from Prada." When told that some eyeglasses cost as much as $800 in the United States, Butler remarked, "I know. It's ridiculous. It's a complete rip-off."
Major shareholders
The list of Luxottica shareholders with more than 2% of holdings, represented by voting shares at 23 December 2014.
* Delfin S.à r.l. 66.485%
* Deutsche Bank Trust Company Americas
Deutsch or Deutsche may refer to:
*''Deutsch'' or ''(das) Deutsche'': the German language, in Germany and other places
*''Deutsche'': Germans, as a weak masculine, feminine or plural demonym
*Deutsch (word), originally referring to the Germanic ve ...
(as ADR depository) 7.466%
* Giorgio Armani
Giorgio Armani (; born 11 July 1934) is an Italian fashion designer. He first gained notoriety working for Cerruti and then for many others, including Allegri, Bagutta and Hilton. He formed his company, Armani, in 1975, which eventually expande ...
4.955%
In September 2012, Delfin S.à r.l. reduced its share of Luxottica from 66% to 62.1%,[Mesco, Manuela]
"Delfin cuts Luxottica stake to 62.1% from 66%"
''MarketWatch
MarketWatch is a website that provides financial information, business news, analysis, and stock market data. Along with ''The Wall Street Journal'' and ''Barron's'', it is a subsidiary of Dow Jones & Company, a property of News Corp.
Histor ...
'', 6 September 2012 but later increased its share to 66% again.
See also
*Safilo
Safilo Group S.p.A. (acronym of ''Società Azionaria Fabbrica Italiana Lavorazione Occhiali'') is an Italian company that designs, produces and distributes prescription frames, sunglasses, sports eyewear, ski goggles and helmets, and cycling helm ...
References
External links
* {{official website, http://www.luxottica.com
EssilorLuxottica
Eyewear brands
Eyewear retailers of Italy
Fashion accessory brands
High fashion brands
Luxury brands
2018 mergers and acquisitions
Conglomerate companies of Italy
Multinational companies headquartered in Italy
Companies based in Milan
Manufacturing companies based in Milan
Design companies established in 1961
Manufacturing companies established in 1961
Italian companies established in 1961
Companies formerly listed on the Borsa Italiana
Companies formerly listed on the New York Stock Exchange
Eyewear companies of Italy
Eyewear brands of Italy