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Newcomers Taking Crack at Sunglass Biz

Published January 31, 2011

By Nicole Formosa

BLOOMINGTON, MN—Few non-eyewear specific companies have seen success penetrating the challenging optical category in bike shops, but at least a couple new players envision a bright future in sunglasses.

Lazer and Shimano have both spoken about plans to develop eyewear for the U.S. market. Lazer, which will have a few prototypes at Frostbike this month, expects to come in somewhere in the mid price range with its line of road and mountain sunglasses. Brian Key, formerly of Tifosi, is designing the line.

The plan is to start small and slowly win over dealers and consumers, similar to how the Belgium company has approached its helmet business in the U.S., said Michael Pederson, who manages Lazer for QBP.

“In two years I think we’ll be in the same place we were with helmets, starting to knock on the door a little bit, but not killing it,” Pederson said.

Through its exclusive distribution partnership with Quality Bicycle Products, Lazer has a bit of a leg up and will leverage that connection with just-in-time shipping for a low-risk inventory commitment, he said.

Shimano has been in the sunglass game for more than a decade with its collection of performance-oriented road and mountain sunglasses for men, women and kids sold in Europe, Asia, Africa and, most recently, South America. Now the Japanese components and accessories leader is eyeing expansion to the U.S. with distribution likely to be handled by Shimano-owned Pearl Izumi, according to Harald Troost, public relations officer for Shimano Europe.

Devin Walton, Troost’s counterpart in the U.S., said the interest in expanding the eyewear programs stems from the success Shimano has seen in Europe and other markets, but most of the details have yet to be ironed out, including price points and an introduction timeline.

“For sure it won’t be this year,” Walton said. “It’s a product that the U.S. offices have looked at saying there may be potential for this item, but exactly what capacity, what models and when that might begin, those are all undecided at this time.”

Part of the reason Shimano is taking its time, Walton said, is due to the known challenges selling eyewear in bike shops, where retailers hesitate to commit to inventory, and consumers often don’t seek sunglasses, particularly at the high-end, with so much competition online and from other retail channels.

Those issues have already dampened several market leaders’ efforts to make a play for market share in the cycling-specific eyewear category, a nearly $16 million business in the U.S., according to Leisure Trends Group. Giro recently decided to closeout existing inventory of its sunglasses in the U.S., and Specialized is reportedly ending sales of its eyewear as well. Rudy Project has shifted its model to include sales direct to consumers through its website in addition to its IBD business.

Several factors contributed to Giro’s decision, including industry-wide challenges such as consolidation, selling price and market evolution, according to Giro brand manager Eric Richter. Ultimately Giro decided sunglasses weren’t the best opportunity for the brand, but will continue selling snow goggles, he said. Giro entered the market three years ago, selling four lifestyle models and seven sport models between $85 and $225 in 550 U.S. retail doors, and about 900 globally.

“We knew that entering the eyewear category was a risk, but we’ve always taken risks to make a better product if we believe we can improve performance or a rider’s experience. We believe the sunglass line did achieve those goals. While sunglasses did not have the commercial success we’d worked for, overall, we view eyewear as something that is true and relevant to the Giro brand,” Richter said.

Though it’s been tried many times, no hardgoods company has successfully built a cycling eyewear business on the merits of its brand name alone, said Greg Randolph, marketing manager for Smith Optics. The one exception would be Burton snowboards, which sells goggles under a separate name, Anon.

Eyewear, especially in the $150 and above price range, is a fashion statement that speaks to someone’s identity or personality, and many consumers seeking that product will shop somewhere they can get an entire line, such as a specialty store like Sunglass Hut, or an outdoor shop like REI. If bike shops are the only channel of trade, a brand will never realize the volume to make it worthwhile, Randolph said.

“To really move sunglasses in a bike shop, it takes a great relationship with a rep focused on eyewear” who will make sure inventory is fresh, clean, organized and well-merchandised, Randolph said.

Retailers who commit to the category often do well with potential for 50 to 60 point margin.

The best opportunity to make money on eyewear is in the $40 to $70 price range, where the product is more of a commodity, Randolph added, and Smith has done well with its $49 Suncloud polarized line. Brands like Tifosi, Ryders and Serfas have been successful on that front, selling basic sunglasses that are often an impulse buy in a bike shop for an average cyclist.

Southern California-based Serfas, which is owned by a former Oakley sales rep, introduced eyewear to its stable of accessories in 2004 and has seen double-digit growth every year since. With 60 to 75 models retailing for $35 to $80 in 800 to 900 bike and running shops, the category makes up 20 to 30 percent of Serfas’ business, said the company’s James Thomas.

Still, it’s been a tough fight to get there.

“The glasses game is super competitive and very saturated with companies,” said Thomas. “Oakley, Rudy, brands at the higher end tie up so much inventory dollars, mom and pop IBD retailers are not going to throw money at those with the Internet and online sales.”

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