Luxottica vertical integration

Analyze the vertical integration of Luxottica. What are the advantages of acquiring brands (Ray-ban,
Oakley…)? How do you increase profitability?
What are the advantages and challenges of acquiring stores (LensCrafters, Pearle Vision…)? How do you
increase profitability?
What are the advantages and challenges of combining with lens manufacturers (Essilor…)? How do you
increase profitability?

http://www.nytimes.com/2006/03/24/business/worldbusiness/an-italian-rivalry-born-of-expertise-in-
glass.html
An Italian Rivalry Born of Expertise in Glass
By JOHN TAGLIABUEMARCH 24, 2006
AGORDO, Italy - This town, with a population of 4,500, resembles many other alpine villages in this
remote northeastern corner of Italy. But Agordo stands more for eyewear than skiing or snowboarding.
It is at the heart of a region that houses both Luxottica Group and Safilo Group, the world's largest
manufacturers of eyeglass frames.
The companies are here because for centuries the deep mountain valleys around it have been home to
craftsmen who specialized in eyeglasses. Indeed, some say spectacles may have been invented in the late
Middle Ages by craftsmen from the nearby Venetian lagoon, where the island of Murano is still noted for its
elegant glass products.
Many of Italy's manufacturers of commodity industrial goods lost their markets in recent years to low-cost
rivals in places like China or Singapore. But Luxottica and Safilo, borrowing a chapter from the playbook of
Gucci or Dior, transformed eyeglasses from a commodity health care product into a costly fashion accessory.
A limited fur-covered edition by Safilo for Armani a few years back, for instance, retailed for 600 euros ($720)
a pair. They captured markets in more than 120 countries and, by expanding into retailing, rose to positions of
world leadership in eyewear.
Still family-controlled, Luxottica and Safilo have added sunglasses and goggles for skiing, surfing and
motorcycle racing to their product lines in the last 10 years. Luxottica has acquired optical laboratories and
corporate eye care programs in the United States. Americans who visit LensCrafters, Pearle Vision, Sunglass
Hut or Solstice Sunglass Stores are shopping in stores owned by the two companies.
As the companies evolved, they have grown, making management a challenge. The opening of new
markets, like India and China, means that they will have to replicate on other continents the well-oiled
wholesale and retail operations they have built in Europe and the United States, where consumers are more
attuned to Gucci or Louis Vuitton.
Moreover, Luxottica and Safilo are moving in several directions at once. Luxottica has added two factories
in China to the six it has in Italy. Safilo added a factory in Slovenia to the four it has around Padua when it
bought the Austrian maker of sports goggles, Carrera. For the bulk of their products, however, the "Made in
Italy" stamp is essential, both companies say.
Each company has a stable of about 20 or more luxury brands, including Versace, Prada and Donna Karan
at Luxottica, and Armani, Dior and Gucci at Safilo.
"They progressively brought eyewear into the fashion sector," said Stefania Saviolo, director of the
master's program in fashion at the Bocconi University Business School in Milan. "They also took on
corresponding burdens: with designer names, with seasonal collections, with large-scale stylistic research."
Andrea Guerra, Luxottica's chief executive, said that Luxottica was "certainly the company that guided
that entire transformation," starting with its acquisition in 1988 of the Armani brand, now the property of
Safilo. Mr. Guerra, 40, joined Luxottica two years ago after running the Merloni home appliances group for a
decade.
Eyewear, he said in a conversation at Luxottica's headquarters in Milan, has especially attractive
characteristics as a fashion accessory, "It's visible all day long," he said. "It's not a perfume; it's not a billfold.
That's the great beauty of the industry."
As the basket of available brands dwindles and brand owners see their value inflate, a game of musical
brands has set in. In January, Ralph Lauren deserted Safilo for Luxottica only months after Burberry did

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likewise; earlier, Armani, with its Emporio Armani and Giorgio Armani brands, took the opposite route, to
Safilo. In October, Hugo Boss chose to go with Safilo.
"More than ever, the gloves are truly off," wrote Flavio Cereda, who follows Luxottica and Safilo at
Merrill Lynch, in a recent report. Luxottica's acquisition of the Ralph Lauren bundle of brands, he said, would
afford it the clout to confront Safilo on the North American market of independent eyeglass shops. Mr. Cereda
upheld a buy recommendation for Luxottica, and downgraded Safilo to neutral. "Safilo was unable to match
Luxottica's muscle," he said.
The battle for brands reveals much about the companies. While Safilo's management is in Padua, not far
from its factories, Luxottica's senior management is in Milan, the Italian financial capital. Moreover,
Luxottica, with revenue last year of 4.4 billion euros ($5.17 billion), is four times as big as Safilo, which has
revenue of 1.1 billion euros. While both companies are listed on the stock exchange, Leonardo Del Vecchio,
Luxottica's founder, retains a 67 percent controlling stake, while Vittorio Tabacchi, whose grandfather founded
Safilo, owns 37 percent of that company's stock.
Luxottica bagged Ralph Lauren mainly by meeting a Ralph Lauren demand for advance royalties of $200
million to cover a 10-year period. In January, Luxottica flexed its financial muscle again, pledging advance
royalties of 60 million euros ($72 million) to Dolce & Gabbana for five years.
The loss of Ralph Lauren was a serious blow to Safilo, depriving it of 10 percent of its annual revenue.
Safilo's chief executive, Roberto Vedovotto, says Safilo refuses to play Luxottica's upfront royalty game.
"I don't think Safilo needs to do that," he said, "we never did it in the past; and we'll never do it in the future."
Safilo, said Mr. Vedovotto, 40, a former investment banker for Morgan Stanley, will make up part of the
loss of Lauren through the deal with Hugo Boss. "What makes Safilo really unique," he said in a conversation
at Safilo's corporate headquarters in Padua, "is that in terms of design and product development, we are No. 1."
Safilo, he added, turns out 2,500 designs a year, compared with 1,000 at Luxottica. "That's why Armani
wanted to switch," he said.
Luxottica was founded in 1961 by Mr. Del Vecchio, now 70 and one of Italy's wealthiest men. (Forbes
magazine estimates his assets at $10 billion.) But its big breakthrough came in 1995 when it acquired the Lens-
Crafters chain of optical shops in the United States. Successive acquisitions added Sunglass Hut and Pearle
Vision stores. The move into retail upset many of Luxottica's retail clients, who saw a supplier become a
competitor too.
"Luxottica made a great bet," said Enrico Cavatorta, Luxottica's chief financial officer. "It had to convince
the others that they were not competitors, not on price, but through the brand." The result is that Luxottica
generates 68 percent of its revenue in the United States.
Safilo operates a chain of 55 Solstice Sunglass stores in the United States, and Mr. Vedovotto says he
wants to go to 150. But Safilo has no ambition to ape Luxottica, he added. "We don't want to integrate
vertically, as Luxottica has done," he said.
To maintain as much of their production in Italy as possible, both companies are investing heavily in
automation. Their factories use robots to replace female workers in welding on tiny hinges, setting rhinestones
or affixing tiny logos to eyeglass earpieces. Luxottica still does 80 percent of its production in Italy.
In many ways, both companies face similar challenges, though for Safilo, the toughest challenge may be
Luxottica.
"With so many brands, it takes a lot internally to make sure you give those brands, and their designers,
their own distinct look and market place," said Marge Axelrad, editorial director of 20/20 and Vision Monday,
eyewear trade publications. "There is intense competition. They are a very compelling market force."

https://www.wsj.com/articles/SB118242914758643332
Luxottica to Acquire Oakley In Deal Valued at $2.1 Billion
Updated June 21, 2007 8:45 a.m. ET
HONG KONG -- Italy's Luxottica Group agreed to take over U.S. eyewear maker Oakley Inc. in a cash
deal valued at $2.1 billion.
Milan-based Luxottica, which owns Ray-Ban and operates the LensCrafters and Pearle Vision retail chains
in North America, said the tie-up would leverage its existing global network and extend the growth potential of
the Oakley brand in new markets.

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 The world's biggest eyewear maker and optical retailer also said the deal would lead to enhanced
economies of scale in sourcing and distribution.
Luxottica will acquire the outstanding shares of Oakley for $29.30, an 18% premium to the shares' 30-day
average, the companies said in a joint statement.
"Significant changes in market dynamics require industry leaders to perfect a mix of best-in-class products
and marketing with technical and operational capabilities," Luxottica chairman Leonardo Del Vecchio said in
the statement.
Jim Jannard, chairman and founder of Foothill Ranch, Calif.-based Oakley, said he is excited that the
companies have found a way to join forces.
"Oakley's technology and performance is one of the world's best kept secrets and this partnership should
empower our ability to tell our story throughout the world," Mr. Jannard said in a statement. "Oakley will
continue to be Oakley but with much greater resources and a platform for realizing the true potential of our
brand and company."
Laura Leonardelli, an analyst at UBS, said the firm has an "excellent track record" of profitably integrating
acquisitions. She added that the deal, which will strengthen its position in the U.S. and sport markets, closely
fits the Italian group's expansion strategy.
Luxottica said the tie-up should produce 100 million euros ($134 million) in savings during the next three
years. It plans to fund the acquisition from operating cash flow, available lines of credit and new debt.
Ms. Leonardelli said the deal would increase fiscal 2008 sales by around 12% and would be roughly
neutral for earnings excluding any tax benefit.
As well as Ray-Ban, Luxottica also makes eyewear for license brands Chanel, Dolce & Gabbana, Donna
Karan, Polo Ralph Lauren, Prada, Versace and others. The group operates six manufacturing facilities in Italy
and two wholly owned factories in China.
The deal has been approved by both company boards and is expected to be finalized in the second half of
2007.

https://www.ft.com/content/45e55d3e-329e-11e4-a5a2-00144feabdc0
Luxury goods. Luxottica’s Leonardo Del Vecchio eyes acquisitions on his return
SEPTEMBER 2, 2014 by: Rachel Sanderson in Milan
Legendary Italian business figure Leonardo del Vecchio is returning to lead Luxottica, the group he founded
over 50 years ago
Leonardo Del Vecchio, 79-year-old founder and executive chairman of the global eyewear group behind
Ray-Ban and Oakley, has acquisitions in his sights and plans to double the group’s revenues to more than €14bn
in the next decade. After a decade spent out of the limelight, Mr Del Vecchio, who became a multi-billionaire
by creating the world’s largest eyewear group by sales, stepped back into the frame on Monday. He took over
as executive chairman of Luxottica, the group he founded half a century ago, after parting with his highly
regarded chief executive Andrea Guerra following a disagreement over strategy. In an interview with the
Financial Times, Mr Del Vecchio says Mr Guerra had not shared his “ambitious plans” for the group, including
further rapid expansion. “I want to grow in the next 10 years even more than in the past 10 years. My aim is that
in the next 10 years we will celebrate having double the revenues than we have now,” said a lean and animated
Mr Del Vecchio at Luxottica’s newly opened headquarters – a bright white tower in central Milan. Mr Del
Vecchio, who will turn 80 in May, was raised in an orphanage. He rose to become one of Italy’s world-class
cadre of postwar entrepreneurs that includes designer Giorgio Armani and chocolatier Michele Ferrero. He sees
much of the desired revenue jump coming from organic growth.
Eyewear sales are growing fast in new markets in South America and in established markets like the US
where they have become a fashion accessory. Mr Del Vecchio sees his generation as another target. “People who
are young like me,” he smiles, “almost all of them carry sunglasses as I do. That will increase as people who are
young like me increase.” However, he also sees acquisitions ahead. “We have done acquisitions, and we will
continue to do acquisitions but for companies that do not cannibalise the shops that we already have and the
interests that we already have. We would buy a chain that does something different for us,” he says. “We want
to grow very fast because we don’t want anyone to be faster than us. We must run, we need to push the accelerator
because we don’t want anyone else to eat our lunch,” he adds in Italian faintly accented from the northeast
mountain region where Luxottica’s manufacturing base is still located, surrounded by snow-capped peaks.

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 Luxottica looked at a tie-up with French group Essilor two years ago. Mr Del Vecchio, who owns 66 per
cent of Luxottica’s shares, says that in the end “we decided it wasn’t a good deal for us” because to make the
deal work he would have had to dilute his shareholding. “Of course I could not accept this.” Considering deals
that would be of interest to him, Mr Del Vecchio speculates that he “would like” a joint venture with a group
like LVMH, owner of Louis Vuitton and Dior and the world’s largest luxury goods group. Luxottica is already
working on a joint venture with Google to design, develop and distribute Google Glass, the interactive headset
costing $1,500.
Mr Del Vecchio’s comments about driving growth come as Gucci-owner Kering said it would be making
its own eyewear in house. The Luxottica founder’s handover of front-line management to Mr Guerra a decade
ago was a rare example in Italy of a family patriarch ceding to a trained manager in the first generation. His
return as head of an executive committee overseeing a new management structure which splits Mr Guerra’s job
in three, among two co-CEOs and a head of operations, has been read by some insiders as a push to put his
family in charge of management in the next generation. Luxottica – a shade too many chiefs Play video Mr Del
Vecchio reiterates his long-held view that he would not be succeeded in management of the group by a family
member, including any of his six children. “No one from my family can become a manager of this company. It
is too big . . . If I had wanted to replace my children today instead of Mr Guerra, I would not have been able to
do it,” he adds. Mr Guerra left Luxottica on Monday after handing his notice to the board. He received a €11.5m
golden goodbye. He also accepted an offer from Mr Del Vecchio to buy back his shares in the group for €34m.
In an interview with the FT in April, Mr Guerra said he was “so happy leading this company” and had no plans
to leave. Luxottica’s revenues doubled during his 10 years as chief executive. “I must thank Mr Guerra for the
work he has done. Luxottica has done much for him. But he has done more for Luxottica. It was an excellent
investment,” Mr Del Vecchio says. And how long does Mr Del Vecchio, who has become an icon in Italy having
created one its few global groups, intend to remain executive chairman? “I will remain president for as long as
the company wants me. The day the board put a vote of no-confidence, I will leave. But I believe the board loves
me, I believe everyone in this company loves me,” he says.
CV: Leonardo Del Vecchio
● Born in Milan in 1935. Enters orphanage as his widowed mother is unable to support him. He later starts
his career as apprentice tool and dye maker in Milan. Switches to making spectacle parts.
● 1961: Founds Luxottica as contract manufacturer.
● 1967: Company starts selling Luxottica-branded spectacle frames.
● 1988: Strikes first licensing deal with Giorgio Armani.
● 1990: Luxottica lists in New York, followed by a Milan IPO in 2000. Listings generate firepower to buy
other brands, including Ray-Ban and Sunglass Hut.
● 2004: Andrea Guerra appointed Luxottica chief executive as Mr Del Vecchio steps back from front-line
management.
● 2007: Oakley bought for $2.1bn.
● March 2014: Luxottica partners with Google to work on the development and distribution of Google Glass
wearables.
● September 2014: Mr Del Vecchio returns as executive chairman.

http://fortune.com/2016/01/27/ray-ban-luxottica-retooled/

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 Re-Tooled: How Ray-Ban Brought Its Brand Back from the Brink
Phil Wahba. Jan 27, 2016
Nowadays, Ray-Ban sunglasses can be found selling for as much as $300 at high-end stores like
Nordstrom and Neiman Marcus. The brand recently opened its first ever flagship store, a sleek emporium in
the heart of Manhattan's shopping mecca, SoHo. And if you walk around capitals like London, Paris and
Milan, it seems like anyone remotely stylish is sporting the shades.
But not that long ago, in 1999, the brand was in a shambles, with its once-pioneering wares on sale for $19
at countless gas stations and convenience stores. And the quality was awful: Ray-Ban was using antiquated
tooling and its frames were flimsy.
It was at that rock-bottom point that Italian eyewear giant Luxottica bought Bausch & Lomb's eyewear
brands, with Ray-Ban as the deal's crown jewel, for $640 million in 1999. And thanks to an aggressive
turnaround plan, Ray-Ban staged a remarkable comeback, one that it is working hard to keep going. In 2000,
Ray-Ban generated 252 million euros for Luxottica, or 10% of company sales. By 2014, that had risen more
than eightfold to 2.065 billion euros, or 27% of Luxottica sales. Ray-Bay now commands 5% of the global eye
wear market, and is the largest sunglasses brand, according to Euromonitor International data.
Before its decline, Ray-Ban had held a dominant spot in American popular culture, thanks to appearances
in classic films from Breakfast at Tiffany's to Top Gun. But looking to boost sales, B&L transformed Ray-Ban
into a mass-market brand.
In its ability to bounce back, Ray-Ban is one of the lucky ones. Few high-end brands that flirt with the
low-end live to tell the tale, as other brands have found when they've lowered prices in a bid to join the
"accessible luxury" market. So the Ray-Ban case instructive for many labels looking to win back their aura..
Luxottica’s Chief Marketing Officer, Stefano Volpetti, recently spoke with Fortune about how the
company returned luster to the iconic brand and what its doing to keep the momentum going.
CASE: RAY-BAN
The Ray-Ban brand first emerged as a major player in eyewear in 1929 when the Air Force asked Bausch
& Lomb to develop a new kind of eyewear that would protect pilots' eyes from glare without compromising
how well they could see. In 1936, Ray-Ban sold the resulting glasses, Aviator-style shades, to the public for
the first time, and an American icon was born.
The ethos of coolness and technical innovation was what Luxottica was looking to revive when it bought
Ray-Ban. But first it had to clean up the brand.
FIXES:
PHASE 1: BETTER PRODUCT, BETTER STORES (EARLY 2000'S)
When Luxottica bought Ray-Ban, it says, the brand's frames fell apart four times faster than those of
Luxottica's other brands. In 2000, Luxottica consolidated production of Ray-Ban sunglasses from four
outdated facilities in different areas of the world to a state of the art facility in Italy, where Luxottica
manufactured other brands in its portfolio. Northeast Italy is known as a hub for premium eyewear, with the
added benefit of proximity to quality parts suppliers.
Convenience stores and gas stations are not the best avenues for cultivating an upscale image. So
Luxottica made the painful decision to exit 13,000 points of sale in the early 2000s, sacrificing revenue in the
short term in the belief that would pay off later. The company was making eyewear for luxury names like
Bulgari, Chanel and Armani, so it already had ins with high-end stores. By 2004, Luxottica was able to
leverage the improved reputation of Ray-Ban to command higher prices again, selling the shades at Neiman
Marcus and Saks Fifth Avenue. In 2000, a year after the acquisition, the starting price for a pair of Aviators
was $79. Two years after that, that had risen to $89. And by 2009, as Ray-Ban started using newer materials
like lightweight carbon fiber and more sophisticated lens technology, the entry price had reached $129."We
needed to clean the market of many pieces of low-quality, old Ray-Bans and clean up the distribution," says
Volpetti.
PHASE 2: EXPAND RAY-BAN'S HORIZONS (2003-2015)
In 2000, all of Ray-Ban sales were for non-prescription sunglasses. Luxottica, tapping its core strength in
the prescription-sunglasses area, brought Ray-Ban into its "optical" business three years later. Fast forward to
2015, and some 30% of Ray-Ban revenues come from prescription glasses, which are generally pricier and
more profitable.

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 Ray-Ban has also moved into personalized products. In 2013, it launched Re-Mix, allowing customers for
the first time to customize their glasses themselves by mixing different frames, materials and styles in 220,000
different possible permutations. Re-Mix now generates 40% of the brand's online revenues. Last year, Ray-
Ban also started offering its shades in new and unusual forms, selling Wayfarers made of leather, denim and
velvet, among other materials.
The brand opened its first flagship in November, a 5,000 square-foot store in Manhattan's hip SoHo area,
that is Luxottica says is key to providing the kinds of experiences that will help Ray-Ban keep its market lead.
The store will offer live performances, film screenings, art shows and exhibits that showcase the brand's long
history.
Volpetti says Luxottica is determined to use the lessons of the last 15 years to successfully enter China.
(Ray-Ban remains an overwhelmingly European and North American brand.) And that means selectively
choosing what stores will carry the sunglasses in China, opting for better doors even if that means a slower
entry. The marketing will emphasize Ray-Ban's history of innovation and as the preferred sunglasses of the
Hollywood set, something Volpetti says Chinese customers aren't aware of yet.
Beyond China, the key to success for Ray-Ban will be to continue to tap what made it a top name to begin
with: good-looking shades that don't try too hard to be fashion-forward, while boasting the latest technical
advances. Such advances include the use in its Liteforce collection of super light and resistant material of the
kind aerospace companies use. Ray-Ban is also about to launch its "Chromance" lens, which the company
claims uses color enhancement technology so people can see colors and contrasts better.
"As long as the brand continues to balance those two dimensions, technical innovation and counterculture
stylishness, it's going to be fine," says Joe Jackman, a retail industry consultant whose firm Jackman Reinvents
focuses on brand revitalization. (Ray-Ban is not a Jackman client.) "The brand has a clear and true DNA and as
long it keeps the balance then they will read as authentic."

https://www.ft.com/content/62751154-dc08-11e6-86ac-f253db7791c6
Luxottica Group. FT Luxottica and Essilor eye connected vision with €50bn merger
Ray-Ban owner and lens-maker plot growth through technology and new markets
JANUARY 16, 2017 by: Michael Stothard and Rachel Sanderson in Paris
Two years after Google pulled its experimental Google Glass from the shelves, the soon-to-be minted
European eyewear behemoth EssilorLuxottica is preparing its own brand of connected glasses.
On Monday, French lens manufacturer Essilor said it was to combine with Italy’s consumer eyewear group
Luxottica in a €50bn merger of equals that is expected to close before the end of the year, according to the
companies.
Hubert Sagnières, chairman and chief executive of Essilor, made clear that part of the rationale for the deal
was to develop new innovative products, emphasising connected glasses as a key mission for the combined
groups. “How can we invent connected eyewear if we do not put together our researchers?” he says, explaining
the deal on Monday. “We will be able to design that product and deliver it extremely fast to consumers through
all the stores of the world and all [our] networks.”
Leveraging “all networks” of the merged group — the biggest cross-border deal between companies in
Europe — is not just about new technologies.

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 The tie-up — which creates the world’s largest visual health and eyewear group with combined revenues of
more than €15bn in more than 150 countries and more than 140,000 employees — is also the clearest sign of the
coming of age of the industry.
Of the world’s 7.3bn people, 63 per cent are considered to be in need of vision correction, but only 1.9bn
wear glasses or contact lenses or have had surgery. More than 2.5bn are still in need, particularly in Asia, Africa
and Latin America, according to industry data.
Meanwhile, the risks of sun damage to the eyes from ultraviolet radiation and blue light are pushing
sunglasses from being considered a “nice to have” to a “must have” item among emerging middle classes.
In the chase to cover all customers, Essilor and Luxottica had been on a “collision course” before the deal,
says Luca Solca, managing director and head of luxury research at Exane BNP Paribas. Essilor is the world’s
biggest manufacturer of lenses, while Luxottica owns the Ray-Ban, Oakley and Sunglass Hut brands.
Competition between the two “giants” had been escalating as lens, frames manufacturing and retail activities
were converging. Mr Solca says the deal would be “excellent for both stocks”. Shares in Essilor jumped more
than 13 per cent and shares in Luxottica jumped 8 per cent on Monday on the news.
Leonardo Del Vecchio, Luxottica’s 81-year-old billionaire chairman, explained the motivation for the deal,
telling investors and analysts on Monday: “We have the brand. What was missing was the quality of the lenses.”
Analysts say it also provides Mr Del Vecchio, a titan in Italian business who founded Luxottica and in effect
created the modern eyewear industry, with a succession plan in the shape of Mr Sagnières, as well as market
leadership in lenses and frames. The merged group is estimated to have about a 15 per cent market share of the
€90bn eyewear and visual health industry, according to Mr Sagnières.
Buyside analysts at Olivetree Securities say that from an “antitrust perspective, the transaction should be
permissible thanks to the differences between the companies’ business model currently”. Nonetheless, they add
that “the prospect for customers of the merged entity is an unappealing one — one of their largest suppliers has
now become their largest competitor”. They expect this dynamic is likely to take the deal into phase 2 antitrust
territory, meaning it will not close until the end of this year. Mr Sagnières says he did not envisage any “big
obstacles” from antitrust because the operations “are totally complementary”. Moreover, he added that the
merged group could “consolidate” other brands in the industry, as long as it fits into a strategy of providing “the
best eyewear at all price points everywhere in the world”.
It is a challenge likely to greeted in some quarters of the industry with consternation — from Italy’s number
two eyewear group Safilo to US start-up Warby Parker, a Silicon Valley “unicorn” which is seeking to disrupt
the Luxottica model by selling directly to the consumer. Still, in a sign of how the fight for consumer spend is
evolving, Mr Sagnières says he considered his “real rivals” to be the big luxury goods groups, the likes of LVMH
and Kering.
“The [luxury groups], for me, are the real rivals. When people buy a scarf for $300 instead of new eyewear,
I am sad. Maybe this person needs a second pair [of glasses] and new scarf may not be as useful,” he says. It is
the same rallying cry both Mr Sagnières and Mr Del Vecchio have employed when confronting competition
from technological groups such as Google — which they both see as potential future competitors for consumers’
cash.
Essilor held talks with Google over the Glass technology, which ultimately went nowhere. Meanwhile,
Luxottica in 2014 signed a deal with Google to develop its Glass headset, but the project fizzled and the product
was criticised by Mr Del Vecchio for being uncool — something the Italian consumer goods brand would never
allow for one of its own glasses. “It would embarrass me going around with that [Google Glass] on my face,”
Mr Del Vecchio told the FT in 2014. But Essilor has several patents around connected glasses, however, which
will be used as a basis for future development, Mr Sagnières says.
The company also this year launched a product in France called MyEye, glasses with a miniature camera
and an earphone that read the text and transmits it into the user’s ear. It can also recognise everyday consumer
products and faces. “We won those patents. We do not want to make them exclusive for someone. They have to
be for everyone,” Mr Sagnières says.

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