Luxottica: A monopoly in the optical industry

Glasses are something we never compromise on, we always go for the best brands.

Because those who wear glasses for them, it is considered to be the most important thing in their life, it is probably the only object in our society which is both a medical device and a fashion accessory. So we don’t mind investing in it. We go for different brands for different features and qualities. There are thousands of brands out there that provide a wide range of glasses, starting from regular spectacles to designer sunglasses. But have you ever wondered why the pieces of little glass, metal, and plastic cost so much?You would be surprised to know that the sole reason for these high prices is just one company and that is Luxottica.

What is Luxottica?

Luxottica is an Italian eyewear company established in 1961 by Leonardo Del Vecchio. It is a company that caters almost allaspects of the optical industry, from designing to manufacturing to distribution and retail. In 2018, Luxottica merged with Essilor which was the leader in leader in ophthalmic optics which is the vision correction lens. And now a combined entity named Essilor Luxottica, commands more than one-quarter of global value sales of eyewear.

EssilorLuxottica the king of the eyewear industry

This Milan based company is the world’s largest optical company. The company is worth around $50 billion, sells close to a billion pairs of lenses and frames every year, and has a workforce of more than 140,000 people. , which is a monopoly in the industry. Thus all the high priced labels you see in the store, are the creation of Luxottica. According to economists, Luxottica is the price maker in the industry. This means it can set the price of its goods the way they want until there is competition in the market which both encourages constant innovation and forces the price of products down toward what they cost to manufacture. But if you think this is the only way they trick you, this is not the end.

Which brand do you use?

Whichever brand you may use, the chances of you wearing a Luxottica is like 80 per cent. Yes, that is true! Apparently, Luxottica controls 80% of the major brands in the $28 billion global eyeglasses industry. Luxottica owns most of the brands, it carefully engineers the prices of different brands to encourage you to shell out an extra charge for your love for the tag which ultimately gives you merely the illusion of choice rather than the choice itself, and extract a lot of money from you in the process instead.

Popular brands that Luxottica owns: Prada, Chanel, Dolce & Gabbana, Versace, Burberry, Ralph Lauren, Tiffany, Bulgari, Vogue, Persol, Coach, DKNY, Rayban, Oakley, Sunglasses Hut, LensCrafters, Oliver Peoples, Pearle Vision, Target Optical, Sears Optical