What if designer glasses didn’t have to cost a fortune? In 2008, this was the question Wharton MBA students David Gilboa, Neil Blumenthal, Andrew Hunt, and Jeffrey Raider entertained as they sat at a bar in Philadelphia. Together, they discussed the idea for a revolutionary eyeglasses company. Their vision was to provide affordable, yet stylish glasses at only a fraction of the price of their competitors. They wouldn’t reinvent the wheel. Instead, they’d reinvent how the wheel was made so they could offer customers a flat rate of $95 for cool, quality glasses. After a lot of research and preparation, the friends launched Warby Parker in 2010.
Yet, Warby Parker isn’t a tale of overnight business success. The company got off to a slow start. In fact, it took six months for the co-founders to even choose a name. Their idea lost Wharton’s Business Plan Competition. Additionally, other entrepreneurs were discouraging toward the idea. David Gilboa tells CNBC, “A lot of people told us the reasons why it wouldn’t work. And I think entrepreneurs can take that kind of negative, constructive feedback in one of two ways. One, it can be demoralizing or on the other hand, it can be really motivating . . . And we chose to take the latter path.”
After being featured in GQ and Vogue’s February 2010 issues, investors came knocking. This led to tens of millions of dollars in funding between 2011 and 2013 from several venture capital firms and two publicly traded companies: American Express and T. Rowe Price. As of 2020, the business obtained Series F and G funding and is currently valued at $3 billion.
Find out below how Warby Parker achieved this type of monumental success.
Using Vertical Integration to Solve Problems
Doing market research before launching a business is an important step the company founders didn’t skip. This was foundational to the inspiration for their business model. The reason designer glasses are so expensive for customers is that the industry is monopolized. Luxottica owns and has licenses for most major designers in the eyewear industry. A blog for UCLA Anderson Global Supply Chain explains, “Warby Parker has found success through disintermediation by designing frames in-house (avoiding licensing fees), working directly with suppliers, and transferring value to consumers,” which results on average to about $97 given back to each customer.
Bypassing Luxottica solves a big problem for customers who want designer glasses but not the hefty price that comes with them. Owning the process allows Warby Parker to make chic glasses that don’t break their customer’s bank accounts. Additionally, the purchase point is affordable enough that fans can buy multiple pairs or easily buy replacements when needed.
Building a Brand
There’s a difference between Warby Parker glasses and unrecognizable brands on display at optometrists’ offices. Warby Parker represents something positive to customers. Like an artisanal cocktail prepared by a meticulous mixologist, the business has been carefully curated by the co-founders to meet their target audience’s exact taste. Glasses, no longer viewed as just a necessity, are considered part of a lifestyle. From naming the company to writing business values into their user experience, Warby Parker has undeniably built a strong, innovative brand their followers can identify with.
First, their brand speaks directly to their target audience on various brand touchpoints. Copywriters writing the brand message are expected to use a style guide that outlines the brand voice and how to communicate and engage with their audience. Copy is short and clean. This is in line with talking to potential buyers who want direct information. It makes the buying process more straightforward for their millennial audience who are mostly busy young professionals. Images are minimalistic, while the models they use represent their target audience so customers feel a sense of belonging. Overall, it’s another part of their user experience strategy to make the process of buying glasses as easy as possible.
Choosing Mission as a Top Priority
Another way Warby Parker attracts customers is by increasing social good with every purchase. From day one, co-CEOs Blumenthal and Gilboa agreed giving back would be one of the business’s core values. “When we made our business plan for what would become Warby Parker, we agreed on a commitment that for every pair of eyeglasses sold, we would distribute a pair to an individual in a developing country . . . all we cared about was that a human being was going to have the glasses they needed to be successful in life,” Neil Blumenthal tells J. J. McCorvey in an article on Wealthsimple.
The company collaborates with VisionSpring, the non-profit Blumenthal directed before starting Warby Parker. With every purchase made, the business provides funding to ensure a person in need receives a pair of glasses. They call this program “Buy a Pair, Give a Pair.” Thus far, they’ve provided eye-care in over 50 countries and given away seven million pairs of glasses.
It’s another move in attracting customers toward buying a product that aligns with their lifestyle. According to research from Cone Communications, “87 percent [of Americans] said they’d purchase a product because that company advocated for an issue they cared about.” Customers want to support brands that support their personal beliefs. By making a charitable cause part of the buying experience, the brand becomes synonymous with increasing social good.
Taking Calculated Risks
Physical stores were a risky move for the company with a decline of the retail industry due to an upspike in e-commerce. After a lot of convincing by investor and CEO of J Crew, Mickey Drexler, the co-founders agreed to try a few retail stores as an experiment. In 2013, Blumenthal and Gilboa decided to start with one store in Manhattan. At first, they believed the store would be nothing more than part of a very expensive marketing campaign. Nevertheless, they wanted to create memorable, phenomenal experiences for their customers. The founders designed the store as a cross between a modern library and an old train station. To the business’s surprise, the store proved wildly profitable.
Over the last several years, the company opened more physical locations and developed a business strategy that conjoins e-commerce and retail sales. “We believe the future of retail is at the intersection of brick-and-mortar and e-commerce . . . Some customers prefer to shop in stores, some prefer to shop online, but deeper than that, most customers like to do both. That’s why we’re continuing to invest a ton into (the website) but also into traditional retail,” Blumenthal explains in an interview with The Los Angeles Times.
As of 2020, Warby Parker has 125 stores across North America.
Providing a Remarkable Customer Experience
Warby Parker is like the Amazon of eyeglasses. Their marketing doesn’t operate in a linear funnel structure. There’s way more to their marketing story than just making a conversion. Instead, they use a marketing flywheel where the goal is to attract, engage, and delight. Their user experience centers upon efficiency, value, convenience, and exceptional customer service. The point is creating an experience so positive that customers become loyal advocates and marketers on their own.
First, Warby Parker launched at-home try-ons for glasses. Potential customers can select up to five styles of frames to try before purchasing. This comes complete with a prepaid return shipping label to send back the glasses. Traditionally, people buying glasses wouldn’t have opportunity to try new frames out for five days to see if they liked them. Customers can also see how their frames look with different attire. In addition, trying on glasses in the comfort of your own home is a major plus.
For customers who need an eye exam, the company offers these in-store. It expedites the usually tedious, expensive, and unexciting process of getting glasses.
Making Buying Decisions Simple and Easy
Although the current market might suggest otherwise, retail isn’t dead. It just needs the same kind of innovative approach Warby Parker has. In an interview with Goldman Sachs, Gilboa tells Rob Sweeney, “We’re recognizing that these customer journeys are much more complex than I think most retailers realize.” By innovatively bridging the gap between e-commerce and retail sales, they continue to win over massive amounts of customers. It’s a bold move most retailers have yet to make.
Warby Parker also developed their own sales software, Point of Everything, which works by providing in-store sales associates with the information needed to make the sale as easy as possible for the customer. First, users create an account online and choose the frames they want to try on. Next, in store, sales representatives can look up a person’s history with the company. This includes past sales, shipping locations, prescriptions, browsing history, and payment options. Team members can also send a direct email with a purchase button for the frames tried on at a store. Together, the online portal and physical locations work cohesively to assist sales.
Investing in Technology
As they continue to scale and vertically integrate, one of the best decisions Warby Parker has made is reinvesting a portion of their profits into developing their own technology. The company has their own data science and applied research team performing research, analyzing customer behavior, and building out technological solutions for the company. This team also helps determine new locations for stores based on customer analytics.
In addition, the team experiments with incorporating the latest technological advancements into their customer experience. One such feat is their virtual try-on program—launched in 2019—which uses augmented reality. Those with an iPhone X (or the model above it) can download the Warby Parker app and use their camera to see what different frames would look like on themselves. For those who don’t want to hassle with at-home try-ons, this is a great feature. Again, it’s a strategy that simplifies the customer journey. With less confusion, a purchasing decision becomes easier.
Disrupting the Industry
Warby Parker didn’t invent glasses. They reinvented the experience of getting a pair of glasses, which is what has made them a disruptive force in their industry. As described by author Gabor George Burt, “Meaningful innovation does not need to be based on outright invention . . . It is based on bold, new combinations of already existing components that simultaneously unlock heightened levels of consumer value and reduce costs.”
One of their latest disruptive innovations is the development of their Prescription Check app. It allows eligible users to renew their prescription online for $15 without visiting an eye doctor in person. Yet, critics say the company is falsely making eye-care patients assume that traditional eye exams are unnecessary. The company says the app is not a substitute for the important testing optometrists and ophthalmologists do. Nevertheless, this technological advancement is advantageous to the business since it cuts a significant portion of Warby Parker’s competition—optometry offices—from the picture. Whether those in the industry like it or not, the company is adapting to customers’ need for quicker, efficient services for eyeglasses. It’s a brilliant strategy for stimulating business growth by serving customers’ desires. As they continue sharpening their technology to accomplish this, they’re forming a greater chasm between themselves and their competitors.
What’s Next for Warby Parker?
In 2019, the company launched Scout, their brand of daily contact lenses. The product is affordable and eco-friendly. The move seems natural for the company since nearly half of their customers also wear contacts. Gilboa tells CNBC, “We’re really excited to be a one-stop-shop . . . We wanted to create a holistic offering.”
While the future isn’t certain, one thing is sure: Warby Parker is a company on a mission to solve their customer’s greatest problems. This pursuit has become a business strategy capable of enormous growth, so why would they change things up now? Blumenthal tells Inc., “I think what we often see a lot of companies do is only ask, ‘How do I drive more revenue?’ as opposed to saying, ‘Hey, how can I solve a customer’s problem? We are doing what makes most sense for our customers—and that’s how we’ll find growth.”
Extending into the future, it’s not inconceivable to envision the company venturing further into the tech world. They have many of the tools needed to become the next Amazon. With a customer-first approach, a cutting edge technology-building team, and an innovative attitude, this prediction isn’t too far fetched. After all, if an online bookstore can become one of the world’s leading forces in technology, it’s not entirely unimaginable that an eyeglasses company could do the same.