Oliver Peoples Looks Ahead, With the Support of Luxottica Behind It

By MARGE AXELRAD: EDITORIAL DIRECTOR

LOS ANGELES—From its distinct L.A. ‘working opticians’ origins to its evolution as one of the eyewear industry’s ‘original’ brands, Oliver Peoples has cultivated a unique posture in the optical market.

When the company was acquired by then-public Oakley, Inc. in 2006, it maintained its business as a unique entity within an even more unique, though very different, company culture.

And, when, in turn, Oakley, Inc. itself was acquired by Luxottica Group (NYSE:LUX) in a major $2.1 billion deal in 2007, Luxottica’s larger mission was to preside over the integration of Oakley as an indirect, wholly-owned subsidiary. Oliver Peoples, the company said, would continue to maintain its “very particular California culture” and report into Oakley.

Since June of this year, VM has learned, Oliver Peoples, Inc. is now no longer reporting into Oakley but directly into Luxottica’s worldwide wholesale division. The move signals a new degree of attention and support to further the company’s global profile.

In comments made exclusively to VM, Andrea Guerra, Luxottica’s CEO, explained, “A critical aspect of our industry is the importance of high end, niche retailers, who not only provide brands tremendous access to tastemaker consumers, but who also demand an incredibly unique and customized service level.

“Oliver Peoples Inc. has marketed to this tier for many years and we want them to continue to do so. We feel that Oliver Peoples can best focus on this by remaining true to their brand DNA and organizational structure within the overall Luxottica Group.”

He added, “They are design and trend-centric led by Larry Leight and his team and we feel this will be a great source of value and learning for us: we feel strongly that the design and marketing based culture of Oliver Peoples married with a strengthening of their operational engine of Luxottica Group will be a powerful combination in the years to come.”

Larry Leight, co-founder and creative director, and David Schulte, in his fourth year as Oliver Peoples, Inc.’s CEO, emphasized that the new realignment, direct to Milan, spells a new future for Oliver Peoples from an international infrastructure, technology, sourcing and financial view.

“We’ve always worked to differentiate ourselves in the market from a product and culture standpoint,” noted Leight. “But via our now-regular communications with Luxottica, we have the freedom to maintain that—and count on a new level support from increased P.R., to new flexibility in

Antonio Miyakawa, executive vice president, wholesale marketing and product development of Luxottica Group, told VM, “Our growth expectations for Oliver Peoples are anchored on two initiatives: one, to organically grow their existing doors via a more impactful and brand relevant presentation, and two, to simply be in areas they currently don’t service around the world. We’ve had great meetings with David Schulte and the management of Oliver Peoples over the last year to study how best to achieve these.”

Said Schulte, “There are no plans for OP to be in LensCrafters or Sunglass Hut, but we will maximize current doors and build deeper partnerships, close low-preforming doors and replace these with new partnerships to give the brand proper visibility with a wider assortment.”

The company originated in 1986, when Larry Leight and Dennis Leight opened the first store on Sunset Blvd., selling vintage frames. The first original Oliver Peoples’ collection, inspired by retro designs, debuted in 1987, followed by the 1998 “Working Opticians” campaign.

The company licensed Paul Smith in 1994. It developed Mosley Tribes in 2004. With a new European customer service/distribution center, OP now oversees sales of Luxottica’s Stella McCartney in Europe.

Oliver Peoples still links its connections with the Hollywood, fashion and media worlds via celeb events and placements, cinema-inspired mini-films, ad campaigns, its own music CDs and special events and partnerships.

In 2006, Oakley’s aggregate purchase price of Oliver Peoples was $55.7 million, including about $5 million in debt and up to $4 million in earn-outs. Today, Oliver Peoples and Luxottica executives declined to give global sales, a breakout of U.S./int’l sales or units sold.

However, said Miyakawa, “We feel confident that the right balance has been met to leverage relevant Luxottica resources to enhance the plan while allowing them to remain true and consistent to their brand identity.” ■