Sunglass Hut

Sunglass Hut

Gift card value in the eyewear sector


Background
Savvy Client
Sunglass Hut

Luxottica Group, the world’s largest eyewear company, has revenues of over $7bn worldwide, controls the majority of the world’s luxury sunglass market and manufactures brands like Ray-Ban, Oakley, Chanel, Burberry, Polo Ralph Lauren and Tiffany. Luxottica has two distinct retail brands in the UK – Sunglass Hut and David Clulow Opticians, both of which launched gift card programmes with Barclaycard. Sunglass Hut is a market leader in sunglasses retailing with 51 stores in high street and shopping locations, in addition to airports and a number of instore concessions. David Clulow, with over 60 stores across the UK (including concessions in Harrods, Selfridges and House of Fraser) is a leading optical retailer providing reading glasses, sunglasses and contact lenses.


Like many high street retailers, Luxottica sold paper vouchers in both its chains – in Sunglass Hut, pre-denominated in £25, £50 and £100 values and, in David Clulow, pre-denominated £50 value. “Vouchers were very much an afterthought instore and not something we actively marketed – they were sold on a very reactive basis. In addition, they were starting to look very tired and really limited what we could offer our customers – they couldn’t buy the exact amount they wanted, for example, only a combination of our pre-denominated values”. Furthermore, like other retailers running paper voucher programmes, security and fraud was an issue for Luxottica. Paper vouchers were difficult to control (even with unique serial numbers) and there was no way of identifying where the vouchers had been issued. Even though they were reconciled in each store on a weekly basis, fraudulent transactions could only be identified when the annual audit was carried out – long after any fraud may have been committed.

David Hartley

Internal Auditor, Luxottica Group UK&I

Choosing a provider

The introduction of gift card was first suggested by Luxottica’s Head of Marketing. She was acutely aware of the issues with paper vouchers and recommended a programme to identify potential vendors in the UK with a view to moving from vouchers to gift card with immediate effect.

In October 2010, Luxottica approached Savvy and Barclaycard. Barclaycard already provided credit and debit card acquiring for both brands and had a proven track record in the prepaid space (through its partnership with Savvy).

“Savvy/Barclaycard was the natural place to start”, continued Hartley. “Barclaycard already provided our credit and debit card acquiring and we had their terminals instore. We didn’t want to incur massive technical expenses or start large systems projects – if it was already there and all we had to do was activate Savvy’s gift card platform, it was going to make a decision much easier”.

Luxottica had always processed credit and debit cards through a dedicated terminal provided by Barclaycard and, with its existing terminals already fully compatible with STORE24, Savvy’s technology platform, a gift card programme could be deployed quickly and easily.
During the sales process it also became apparent that there was an opportunity for Luxottica to take advantage of access to broader sales channels offered by Savvy and an introduction was made to SVM Cards.

SVM markets gift cards to businesses which then utilise them for customer promotions, corporate incentives and rewards; and loyalty programmes. This relationship significantly broadened Sunglass Hut’s potential reach, allowing new customers and businesses to buy its cards without ever having to visit a store – something they hadn’t previously done with their paper voucher programme.


Launch

Luxottica launched gift card in December 2010 – just before Christmas and only eight weeks from initial enquiry – across all of its Sunglass Hut and David Clulow stores. The cards were supplied to customers in branded wallets (further reinforcing the gifting aspect of the cards) and an incentive programme, designed to raise awareness and drive sales, was introduced for staff. This incentive programme got staff used to selling and activating the cards and really raised the profile of gift card as a product, not simply a replacement for paper vouchers.

“Sunglasses are a very personal gift and difficult to choose for someone else – the giftcard was an ideal alternative to buying the actual glasses and made gift purchasing really easy for customers. And, while it could be argued that they had that option with paper vouchers, it seems from the results so far that customers feel more comfortable buying gift cards”, commented Hartley.


Result

Luxottica launched gift card in December 2010 – just before Christmas and only eight weeks from initial enquiry – across all of its Sunglass Hut and David Clulow stores. The cards were supplied to customers in branded wallets (further reinforcing the gifting aspect of the cards) and an incentive programme, designed to raise awareness and drive sales, was introduced for staff. This incentive programme got staff used to selling and activating the cards and really raised the profile of gift card as a product, not simply a replacement for paper vouchers.

“Sunglasses are a very personal gift and difficult to choose for someone else – the giftcard was an ideal alternative to buying the actual glasses and made gift purchasing really easy for customers. And, while it could be argued that they had that option with paper vouchers, it seems from the results so far that customers feel more comfortable buying gift cards”, commented Hartley.

“Deploying prepaid with Savvy and Barclaycard was extremely simple and straightforward, ” 

“Their consultative selling approach identified value-adds, like third party selling via SVM, that we had never considered before. The fact that it could be processed on our existing terminals made the decision very easy for us and meant that our gift card programme was live in-store within eight weeks of us giving the go-ahead.”

David Hartley

Internal Auditor, Luxottica Group UK&I