Investor Day 2010 - Essilor
Investor Day 2010 - Essilor
Investor Day 2010 - Essilor
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India<br />
Faster Growth and Share Gains<br />
in A Booming Market<br />
Jayanth Bhuvaraghan<br />
President, South Asia, Middle East,<br />
South and East Africa, ASEAN
India GDP Expected to Surpass France GDP by 2017<br />
Source: Goldman Sachs, Tushar Poddar & Eva Yi, India’s Rising Growth Potential, Global Economics Paper No. 152, January 22, 2007<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 2
Fastest Growing Mobile Phone Market<br />
in Millions<br />
Mobile Subscribers<br />
• Fastest growing mobile phone market in the world, adding ~20 Million new<br />
customers each month<br />
• 670 Million customers and counting (August <strong>2010</strong>), 2nd largest<br />
telecommunication network in the world in terms of wireless connections<br />
Source: Wikipedia<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 3
<strong>Essilor</strong>’s Journey in India<br />
Key Metrics 1998 <strong>2010</strong><br />
Number of employees 26 2,168<br />
Number of labs 2 38<br />
(11 <strong>Essilor</strong> labs, 27 partner labs)<br />
Number of subsidiaries 1 10<br />
CAGR = 58%<br />
Partnerships<br />
<strong>Essilor</strong> India<br />
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 F<strong>2010</strong><br />
Market leader in the country with good margins<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 4
Opportunities<br />
Huge uncorrected<br />
vision market<br />
1<br />
Conversion from<br />
glass to plastic<br />
4 2<br />
Conversion from<br />
BTF to PAL<br />
3<br />
Low retail<br />
penetration<br />
Domestic market lens volume is expected<br />
to grow from 83 Million to 250 Million by 2020<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 5
1<br />
Huge Uncorrected Vision Market<br />
100<br />
Million<br />
500<br />
Million<br />
600 Million people in India require vision correction…<br />
but only 100 Million correct their vision<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 6
2<br />
Conversion From Glass to Plastic<br />
2009<br />
2014<br />
67%<br />
33%<br />
32% 68%<br />
Glass<br />
Plastic<br />
Source: <strong>Essilor</strong> Estimates<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 7
3<br />
Low Retail Penetration<br />
Number of people per optical retail outlet<br />
Potential to grow the number of optical outlets by around 10 times,<br />
or ~100,000 additional shops in order to reach the penetration of<br />
developed countries<br />
Source: <strong>Essilor</strong> Internal Study (2008)<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 8
4<br />
Conversion from BTF to PAL<br />
Population Demographics Lens Industry Structure in <strong>2010</strong><br />
100+<br />
<strong>2010</strong> 2020<br />
BTF 20%<br />
3%<br />
PAL<br />
90-94<br />
80-84<br />
70-74<br />
60-64<br />
50-54<br />
40-44<br />
30-34<br />
77%<br />
SV<br />
20-24<br />
10-14<br />
0-4<br />
-150 -100 -50<br />
0 50 100 150<br />
Source: US census bureau<br />
Population >40 years old will increase by over 100 Million in the next 10 years<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 9
Our Strategy<br />
1 2 3 4<br />
5<br />
Multi‐<br />
Network<br />
& Multi‐<br />
Channel<br />
Consumer<br />
Branding<br />
Strong,<br />
Motivated<br />
People<br />
Excellent<br />
Relationship<br />
with Trade<br />
Sustainable<br />
Growth<br />
Initiatives<br />
5 Growth Levers<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 10
1<br />
Multi-Network & Multi-Channel<br />
<strong>Essilor</strong> brands<br />
Delta Lens<br />
2020, Delta CNC, Sankar<br />
Premium<br />
Vision Rx, VV, BG<br />
L&S, GKB Optics, XtraVision<br />
Mass Market<br />
OSD<br />
Rural Marketing<br />
Creating a new market<br />
One stop shop for our customers, in some<br />
cases selling competition brands<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 11
2<br />
Consumer Branding<br />
• Started advertising campaign with Varilux from 2005, and with Crizal<br />
from 2006<br />
• Sustained improvement in sales and EBIT margin<br />
• “Crizal as a lens” – No. 1 consumer ophthalmic lens brand<br />
• Endorsed by Luxottica in their nationwide Ray-Ban advertisements,<br />
to help both companies leverage brand power<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 12
3<br />
Strong, Motivated People<br />
Average age ~31 years old. Overall 80% university graduates (<strong>Essilor</strong> India).<br />
Serves as talent pool for <strong>Essilor</strong> International. Entire business run<br />
by India local talents.<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 13
4<br />
Excellent Relationship with Trade<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 14
4 Strong Branding in Shops<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 15
4<br />
Club Platine Website<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 16
5<br />
Sustainable Growth Initiatives<br />
Expanding the market… Increasing the number of wearers<br />
Some actions taken so far:<br />
1<br />
Think About Your Eyes<br />
2 Social Media<br />
3 Rural Marketing<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 17
1 Think About Your Eyes 2 Social Media 3 Rural Marketing<br />
• What is “Think About Your Eyes”<br />
• A program to create awareness about eye care<br />
and promote the importance of eye checks<br />
• Plan:<br />
• Pilot program in Chennai in December <strong>2010</strong><br />
• Partnership with Luxottica<br />
• Win the support of opticians, ophthals and<br />
optometrists<br />
• To measure the number of walk-ins through<br />
the program<br />
• Key Tactics:<br />
• PR, radio, buses, website, direct mailers, mobile vans<br />
• POS in shops<br />
• Activities in schools, malls, beaches, parks, theatres<br />
• Consumers and opticians incentivized to promote eye tests<br />
• We will monitor the number of new prescriptions<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 18
1 Think About Your Eyes 2 Social Media 3 Rural Marketing<br />
• <strong>Essilor</strong> India’s Facebook initiative<br />
• Launched August 30, <strong>2010</strong><br />
• Feeds and content<br />
• Facebook Wall posts<br />
• Viral Video on eye diseases<br />
• Facebook contests<br />
• Facebook ads<br />
• Facebook queries<br />
• Cheap and effective way<br />
to drive traffic<br />
• 6,797 followers & 6,782 likes*<br />
* As of 26 November <strong>2010</strong><br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 19
1 Think About Your Eyes 2 Social Media 3 Rural Marketing<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 20
1 Think About Your Eyes 2 Social Media 3 Rural Marketing<br />
Wardha (nov 2007)<br />
Bangalore (dec 2006)<br />
Theni (mar <strong>2010</strong>)<br />
Rameshwaram (apr 2007)<br />
Amethi (dec 2006)<br />
Kolkata (jan 2009)<br />
• MRV projects started 2006<br />
• 6 vans today<br />
• 6 locations across 5 states<br />
• Partners – Sankara<br />
Nethralaya, Aravind Eye<br />
Hospital & Indira Gandhi<br />
Eye Hospital<br />
• As of October 31, <strong>2010</strong><br />
• 1,849 villages visited<br />
• 184,533 patients have been<br />
screened<br />
• 40,958 spectacles sold<br />
• Investing in more vans in<br />
new states<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 21
Going Forward<br />
1 Enlarge distribution network<br />
2 Invest in brands<br />
3 Help to create more shops<br />
4<br />
Continue to develop products<br />
suited to Indian needs<br />
5 Accelerate conversion<br />
• Uncoat to HMC<br />
• BTF to PAL<br />
• Glass to Plastic<br />
6 Continue to invest in people<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 22
India: One of the Successful Stories of <strong>Essilor</strong><br />
in Fast Growing Countries<br />
> Fast growing country with huge vision needs<br />
><br />
Strategy firmly in place to take advantage<br />
of identified growth opportunities<br />
> $ 1 Billion revenue for <strong>Essilor</strong> in 2020…<br />
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 23
<strong>Investor</strong> <strong>Day</strong> – December 10, <strong>2010</strong> 24
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