One might assume they could easily guess the biggest competitor for a startup focused on selling contact lenses direct to consumer (DTC) via subscription. Maybe Johnson & Johnson or The Cooper Companies (America’s two largest contact lens manufacturers), or even Warby Parker, which recently added contacts to its table of vision correction products. One might assume the competition is just glasses in general, and that Luxottica (the largest maker of glasses frames worldwide) is the real white whale being hunted.
However, as Hubble Co-founder and Co-CEO Jesse Horwitz — also author of the forthcoming book Selling Naked: A Revolutionary Approach to Launching Your Brand Online — has learned over the four years in which he’s been operating a DTC contact lenses business online, none of those firms are the biggest competition in the world of vision care. Not even close.
“The biggest hurdle here is it is a meaningful cash-out age category, and consumers have another much cheaper option: going without correction at all. There are an awful lot of people who just go around with less-than-optimal sight, and that is the true competitor at the end of the day,” he said.
What got Hubble off the ground was an observation that it could fix this problem with a better, far less cost-intensive experience. Its original focus was on daily disposable contact lenses, because they had the best safety profile in terms of infections and other compilations. That best record, however, comes with a slight catch. To gain the benefits, customers must actually change out those contact lenses on schedule, and not try to squeeze extra life out of them by overwear.
Hubble, at base, has a simple goal: make customers keep to that schedule, and reap those benefits as easily and cost-effectively as possible. The good news is that when the company entered the market in 2016, it didn’t spend much time pushing rope to get investor interest in the idea. Dollar Shave Club had just sold, and there was a rapidly growing understanding that letting consumers get items like contact lenses delivered to their doors was increasingly how they wanted to buy, particularly if they could do it via subscription.
Making the lenses — which, by nature of what they are, has a basically non-existent margin of error— was a bit more of a challenge than expected, though.
“Our partner in manufacturing has over 25 years of experience in both the United States and around the world, and it was incredibly important to line up the right partner with the right experience that we didn’t bring directly to the table ourselves,” said Horwitz.
Perhaps equally important, however, has been the realization that even if Hubble doesn’t manufacture it, the company can and should still offer the product on its site. That makes it unique among DTC brands, which usually sell their own goods alone. Over the last 12 months, Hubble has determined that though it can serve “a good chunk of the market,” there are still people out there for whom the company has no solution, which is why Hubble has been selling brands of lenses other than its own.
“We want to be the one-stop shop for contact [lenses], whatever the customer’s needs may be,” Horwitz said.
Meeting those needs, he added, goes beyond the product profile itself — it goes into the buying mechanism as well. When Hubble started, it billed annually for subscriptions, because that was the best way to make the most cost-effective offer to the consumer. What it learned over time, however, is that direct cost is an incredibly important consideration to consumers, and that liquidity and cash flow over the course of a month is an equally important consideration.
Making the subscription cost payable monthly — and building in much flexibility around those payments so a customer can skip or delay an order as needed — offers the kind of flexibility Hubble customers need when it comes to managing cash flow. The company may eventually test an annual payment offering, but even on the monthly payment rate, it is “very affordable against the market,” he said.
Hubble has found, though, that customers are looking for a best-of-both-worlds offering when it comes to the subscription service. They want to be locked in — in the sense that the customer wants to be able to set and forget their contacts, and know that the contacts will be there in the morning when they need to put them in. However, they want that lock-in to be loose enough that if their situation changes, or if they need to make an adjustment, they don’t feel like they are trying to wriggle out of an iron-clad commitment to vision correction.
The point, at the end of the day, is to meet the consumers’ needs reliably enough so that they want to keep coming back. Churn is part of the subscription business, he said, and though Hubble would vastly prefer a retention rate of 100 percent, that probably isn’t going to happen. What it can do to fight churn, however, is constantly think of what other offerings it is ready to make under the DTC banner.
“For us, the real loss is if you come to our site and you are looking for contacts, and we don’t have any offering that will fit your needs,” Horwitz said.