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Optical Markets Continue to Grow Fourth Quarter 2016

The total vision care industry generated $40.4 billion in revenue during the 12ME period December 2016—rising by 1.5% over previous year totals and up by 21.0% over 12ME June 2008 retail sales totals—before the recession set in. During the December 2014 to December 2016 time period the strongest optical markets were plano SG sales (+8.5% to $4.2 billion) and Rx lenses (+9.6% to $12.82 billion). Eyeglasses accounted for the largest share of the vision correction market (55.8%) representing $22.53 billion, growing by 8.1% over the past 2 years.  

During the 12ME period December 2016, sales of optical “products” (eyeglasses, readers, sunglasses and contact lenses) generated $32.42 billion in sales at the retail level through all outlets and channels. $1.84 billion of those sales originated from the Internet through direct online purchase activity.

The independent side of the optical industry is by far the largest component of the U.S. vision care industry—generating $18.28 billion in revenues during the 12ME period December 2016. While independents enjoyed their sixth straight year of dollar revenue growth during the 12ME period December 2016, other optical distribution channels also experienced growth recently. For conventional retail chains, sales revenue grew by 1.1% to $8.15 billion during the 12ME period December 2016. Additionally, optical sale revenues for mass merchants and wholesale clubs grew by 2.1% to $5.11 billion during the 12ME period December 2016.

This period there was an absolute increase in usage rates for most types of eyewear in the US. This is mainly due to the continual increase in the American adult population, as well as a movement back to vision correction usage among key demographics. Usage, as a percentage of the adult population, was up the most for Rx sunglasses and Rx eyeglasses. The US added almost 600K new/additional sunglass users over the past year. Most of this increase in eyeglass usage can be traced to the increase in people with MVC benefits, the decline in LASIK/refractive surgery procedures and the decline in CL usage that occurred during 2016.

As of December 2016, we estimate that over 126.6 million American adults have vision benefits. Thanks to a rising adult population (+1.2M to +1.8M annually) and to an improved economy and higher employment, the number of adults with MVC coverage increased for about 7 years now after declining during the recession. In fact, the number of covered lives increased by about 1.9% (or 2.4 million additional adults) during the 12ME period December 2016 alone. In fact, compared to 2007 (before the recession started), the aggregate number of adults with some form of MVC coverage was up by 14.6 million from December 2007 to December 2016.

Of the 74.5 million pairs of frames purchased during the 12ME period December 2016, most (48.7 million) were purchased with some type of assistance from a managed vision care plan. The remaining 25.8 million pairs were purchased without any form of insurance assistance. During the 12ME period December 2016, MVC insurance frame purchases increased most among all major distribution channels and most retailers, with independent ECP retailers (+4.2%) and conventional optical chain retailers (+0.9%) seeing the largest increases in frame purchases with insurance assistance.

Data in this article was compiled from VisionWatch, the large scale continuous research study conducted by The Vision Council. VisionWatch contains useful industry data on lenses, frames, sunglasses, reading glasses, LASIK, contact lenses and eye exams. For additional information, please contact Alexis White at 703-740-2251.

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