Neil Blumenthal: How We Built a $598M/Year Glasses Company

Neil Blumenthal in Warby Parker store

“In 2008, when we initially had the concept of selling glasses online, nobody was doing that. Now, a bunch of other categories were moving online and doing so very successfully. Whether it was Zappos selling shoes or Blue Nile selling engagement rings, footwear, and jewelry. Glasses were a category folks thought could never be sold online.

Meanwhile, now it seems so obvious. Yeah, of course, you can buy that over the internet. But what we heard from friends and family was, ‘I don't know if I'd buy glasses online because I need to try them on first.’

So we tested a virtual try-on where you had to hold up a credit card to your face. That way, you had a reference point to properly fit a pair of glasses.

When we experimented with that, we found customers didn't like it. [The virtual try-on] didn't look real. It gave them less confidence in buying. So we went back to the drawing board and came up with this idea to ship people five pairs of glasses where they'd have five days to try it on at home for free.

If there was a pair that they liked, we would put in prescription lenses and ship it to them. This program has been wildly successful, and I think it's one of the reasons that Warby Parker was successful from the get-go.

Q: Before Warby Parker, Luxottica was one of the major dominating players in the eyewear industry. They own brands such as RayBan and Oakley, and they also own stores like Sunglass Hut and LensCrafters. How difficult was it to enter a market controlled by a monopoly?

When you have really large incumbents, you have to understand what's their business model, what are their strengths, and how to navigate around them.

So, for us, it was important that we have our own brand, right? We're not licensing some other fashion brand. Luxottica makes a lot of its money by licensing big fashion names like Prada, and they sell those glasses out of their stores like LensCrafters. So we were going to design glasses under our own brand. Then, we were going to partner with factories that weren't primarily selling to Luxottica. Because, at any point, Luxottica just could tell the factory, ‘Hey, stop manufacturing Warby Parker’s designs.’

Similarly, you have optical labs where you cut lenses, insert them into the frames, and ship them to customers. We've built our own optical labs so that way we can control that process. It helps us maintain high-quality standards and get the product to customers fast.

We found when we do things ourselves, we're able to do it at cheaper costs than others.”

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