Oakley has announced several strategic initiatives in the past few weeks that testify to its desire to accelerate the process of diversifying its retail distribution channels, compensating for the termination of its long-standing relationship with Sunglass Hut. Other programs will be announced shortly.
Following in some ways the vertical integration strategy of its big enemy, Luxottica, Oakley has acquired Iacon, a small US chain of 40 mall-based sunglass specialty shops, with sales of about $15 million in the past year, that was buying about 26 percent of its merchandise from Oakley. The 20-year-old chain operates stores under the Sunglass Designs, Sporting Eyes and Occhiali da Sole banners, mostly in the US sunbelt. It recently entered a licensing agreement with HMSHost to open sunglass stores at its sites in airport terminals and toll road locations.
Iacon's founder and president, Jeff Obstfeld, will continue to run Iacon's day-to-day retail operations out of its present headquarters in Scottsdale, Arizona. He will also serve as an advisor to Oakley for the development of its own exclusive O Store and Vault retail concepts, which will be accelerated.
Oakley has also expanded its retail partnership with Venator Group, the world's largest sporting goods retail chain, indicating that it represents a better partner than Sunglass Hut because footwear and apparel, as well as watches, are becoming increasingly important components of Oakley's range of products. Venator, which has changed its name to Foot Locker, runs several chains of sporting goods stores under such banners as Foot Locker and Champs Sports.
Thus, the number of Champs stores carrying Oakley products is been extended from 370 to 500, with more than 100 carrying also Oakley footwear and 50 others adding Oakley apparel. In 75 larger Champs stores, the shelf space dedicated to Oakley products is being doubled right now, with 25 more outlets to follow in the 4th quarter. Actual Oakley concept shops will be set up at 5 Champs stores in the 4th quarter, rising to 30 locations next spring.
In addition, 350 of Venator's 1,500-odd Foot Locker stores in the USA will qualify for Oakley's newly established "Premium Oakley Dealer Program," involving special conditions in exchange for extensive in-store and window signage and merchandising. An extensive assortment of Oakley's more innovative eyewear will be introduced at these stores by early November, displayed on double-wide eyewear towers. Oakley footwear will be displayed at 316 Foot Locker stores, up from 112 currently.