Luxottica mandates reorganization for Oakley

By

Cassidy Mantor

Published
Jul 28, 2016

Major structural changes are coming to Oakley apparel, marketing and retail as Luxottica has announced a new plan for its North America business.

The Foothill Ranch action sports and eyewear company will be undergoing what Luxottica's CEO Massimo Vian called "a necessary action to protect the equity of Luxottica’s proprietary brands" which also include Ray-Ban, Dolce & Gabbana eyewear and Oliver Peoples.

Aggressive changes to the Oakley organization include moving all of marketing to Lux's Milan, Italy office, and moving all of Oakley's retail ops to their North America office in Ohio.

Vian further explained on Lux's earnings call that “brand activities will be more and more coordinated by our Milan main office," meaning that Oakley will now share marketing resources with Ray Ban, Dolce and Oliver Peoples.

Lux is looking at using Oakley's former design and creative headquarters in Foothill Ranch now more exclusively as a manufacturing center and production plant.

Vian also said apparel, footwear and accessories, the largest chunk of Oakley's business outside of eyewear, will be significantly scaled back according to Vian, starting with the Spring 2017 line.

As Oakley was once a stronghold in action sports, Luxottica is now fighting a war on discounted prices. Part of its plans for Oakley include instituting a Minimum Advertised Price (MAP) policy imposing restrictions on retailers and requiring them to gain approval before offering discounts on Oakley product.

Luxottica has reported net income up over 5% in the first part of this year, suggesting its aggressive reorganization plan for Oakley will continue even if the effect is a further depletion of the company culture and Southern California essence that once was synonymous with the brand.