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Luxottica’s premiumisation plans

Luxottica OPSM Norwood

MATTEO ACCORNERO was appointed to lead Luxottica’s retail business in ANZ a year ago and is now overseeing a major investment program across the company’s optical stores aimed at elevating the end-to-end customer experience.

When Matteo Accornero was shoulder tapped last year by EssilorLuxottica’s CEO Mr Francesco Milleri to head up Luxottica’s retail operations in Australia and New Zealand, it was an opportunity he found impossible to resist.

Based in Milan at the time, he had only been with the Italian eyewear giant for a matter of months, starting in March 2020 as integration and business development director to assist with the company’s merger with the French ophthalmic lens giant Essilor.

Matteo Accornero.

Italy was in the throes of its initial COVID-19 outbreak, so the chance for the 37-year-old to move his young family to Sydney seemed like an ideal opportunity both personally and professionally.

“Australia is one of our biggest markets retail wise, so it was difficult to say no,” he says.

“Also from a personal perspective, it’s a great country to live in, my daughters who are three-and-a-half and three-months-old are learning English, and we enjoy the outdoor lifestyle here compared to the busy and chaotic metropolis of Milan, so it ticked all the boxes.”

Accornero has been responsible for Luxottica’s ANZ retail business for a little over a year now and is already driving significant change across its four retail banners: OPSM and Laubman & Pank (optical), Sunglass Hut (a dedicated sunglasses business), and Oakley (sunglasses, apparel, fashion and accessories).

Overseeing more than 600 storefronts, 300 head office employees and more than 4,500 store staff across two countries is a significant task. But he’s leveraging his extensive experience in top tier management consulting. Much of that work has focused on retail, luxury, and consumer goods, including as a principal for Boston Consulting Group between Milan and Amsterdam for eight years.

But it was in his role as an associate partner of McKinsey & Company in Milan where he first began working with Luxottica in 2019. As an external consultant, he was helping the Luxottica and Essilor merger identify synergies and opportunities across several markets, which involved coordinating teams in Milan, Paris, China and the US.

Before long, he was invited to officially join Luxottica to continue his work in-house, before Milleri soon asked him to take up the ANZ posting.

“Having seen the company from the outside as a consultant, I knew there were a lot of positive challenges coming in terms of growth and opportunities across many geographies,” he says.

“And as an Italian there is a lot of pride to work for one of the few global leaders we have, and then with my background and passion in consumer goods and retail, it felt like it was the perfect match.”

Elevating the customer experience 

Since arriving in Australia in October 2020, Accornero has wasted little time implementing his first major priority. This has been the initial rollout of a significant investment program, aimed at ‘premiumisation’ of the end-to-end customer journey.

In the company’s OPSM and Laubman & Pank stores (337 and 38 stores respectively in ANZ), this has involved reassessing each customer touchpoint and investing in new initiatives that improve the in-store experience, technology and customer engagement.

By the end of the year, the initiative would have been rolled out to the first 50 optical stores, with the program set to expand in 2022.

“The common theme of premiumisation for Luxottica is about elevating the overall experience by getting closer to something you might get in a luxury boutique, in terms of attention to details, care and service,” he explains.

Luxottica is upgrading to automated technology in many stores, including the Vision-R 800 Auto Phoropter.

“But it’s not about luxury for the sake of luxury or creating a more exclusive experience, it’s about evolving from the traditional model – that was more focused on the optometrist providing eyecare – and elevating the retail experience in-store to help our customers recognise and understand the value they are getting in our products.

“At Luxottica, we saw that now is time for change and we are in a position where we can drive this change, so premiumisation means reviewing all facets of the customer experience to elevate it and offer more.”

Luxottica’s premiumisation plan has begun with refurbishing several stores, transforming them from functional facilities into stores that invite customers to stay and browse. This involves rethinking the store’s design in terms of lighting, layout fixtures and ergonomics, among others.

These enhanced aesthetics have extended into the exam room too. Luxottica has also invested in new automated technology, such as the Vision-R 800 Auto Phoropter and Wave Analyzer Medica 700 wavefront aberrometer by Essilor Instruments, which is helping to modernise the patient experience.

The Wave Analyzer Medica 700 wavefront aberrometer.

“Compared to previous technology, this will provide a totally digitalised workflow, which is not about shortening the examination time – they’re actually going to be exactly the same – but being better able to understand the issues that the customer has with their eyesight and allowing the optometrist to concentrate more on the relationship, rather than playing with manual adjustments,” he explains.

With Luxottica now exclusively selling Essilor lenses, the next facet relates to helping patients better understand the lens technology they’re purchasing. Accornero says often customers think they’re paying for the frame, not realising that the majority of their purchase is for the lens.

“We believe there is strong opportunity to explain the value in the lens and how it meets their needs. By making customers aware about the value and benefits they have purchased, they then become ambassadors,” he says.

“We are also investing much more in what we call ‘lens storytelling’, which involves developing new store features that will showcase lenses and lens benefits, and together with Essilor we are developing technology that will allow the customer to understand the difference between the lenses on offer in a digital simulation environment.”

Accornero says Luxottica is also investing in staff training and knowledge around lens benefits, upgrades and coatings, so they can personalise the final recommendation based on the customer’s needs.

“We consider the training of our people to be extremely important, so Luxottica have just launched a new training platform called Leonardo,” he explains.

“It’s much like Netflix and is totally customised so the platform knows which banner and store you work for. It’s also capable of sending personalised training recommendations based on the product you’re getting on any given week, and, of course, there are modules around all the classic selling techniques for lenses.

“The ability to personalise training and deploying it virtually without having anyone travelling, moving or gathering is really something unique.”

Accornero says another key piece of new technology is the Smart Shopper tool that allows customers to interact digitally with the entire catalogue of Luxottica products in-store. It includes a virtual try on feature thanks to augmented reality and advanced proprietary virtual mirroring technologies.

OPSM Victoria Point, Queensland.

Accornero says the tool is used either on a large screen or on an iPad where customers can try on any colour combination, as well as eyewear that may not be in the local store’s assortment.

“That means we are giving everyone access to our entire portfolio of products, which can be paid for in stores and shipped to their home after a few working days, so we believe this will be a strong innovation and something that contributes to the success of the group’s omnichannel strategy.”

Although it was too early to provide precise data, Accornero says investment in the ‘premiumisation’ of its stores has paid off, with an overall improvement in store KPIs. While the company acknowledges the model won’t be suited to every demographic, he says Luxottica has seen enough positive results in the current pilot to warrant its extension.

“I think we are happy to a point where we have accelerated our investment plan for next year to bring it to another big group of stores, so I think our commitment and the group’s commitment shows we strongly believe it is the right move.”

Essilor integration 

With the Essilor and Luxottica merger deal completed in October 2018, efforts have continued to focus on integrating the two global giants, which comprised more than 150,000 employees at the time of the deal.

Accornero says while EssilorLuxottica has begun reviewing its regional leadership, it was yet to do so in ANZ, but changes are expected in the coming months.

Currently Luxottica is based in Macquarie Park and Essilor in Surry Hills, but early next year both entities will move under the same roof at a new north Sydney facility.

“Once we move into a new joint location, this will be a great way to start acting as a team, obviously respecting all customers of our businesses through strict confidentiality rules and behaviours that need to be enforced in such an environment,” Accornero says.

“Our partnership is stronger than ever, in the last 18 months we have transitioned to selling a majority of lenses by Essilor, and we will have further access to the top performing lenses. We are investing further with Essilor Instruments in technology, so we couldn’t be happier at this stage, and we are excited to see where it heads in future.”

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