Dive Brief:
- Warby Parker is investing in AI, services and partnerships to deliver standout customer experiences, according to executives on a Q4 2024 earnings call Thursday.
- The eyeglasses retailer will build on its virtual try-on tool with new AI-powered offerings in the coming months, according to Co-Founder and Co-CEO Neil Blumenthal. One of the planned tools is a recommendation engine that tailors product suggestions based on the customer’s facial features and style preferences.
- Warby Parker saw adjusted gross margin improve in 2024 driven in part to two owned-optical labs capable of fulfilling prescription glasses orders, according to CFO Steve Miller. Greater control over the fulfillment process led to benefits including higher NPS and faster turnaround times.
Dive Insight:
Warby Parker is refining customer experience across multiple facets of its business as the retailer works to grow its sales momentum.
Net revenue rose nearly 18% year over year to $190.6 million in the fourth quarter, the company said in its earnings release. Retail revenue rose 23.9% year over year during the quarter while e-commerce revenue grew 5.3% year over year. Additionally, the company’s net loss improved by $12.2 million year over year to $6.9 million.
Warby Parker aims to maintain its e-commerce growth sales by making the shopper journey “even more intuitive and engaging,” Blumenthal said. Currently, three-quarters of iOS app users engage with virtual try-on, which he says is a sign that other digital CX improvements could help drive sales.
The retailer plans to invest in its workers to help the customer experience, too, according to Blumenthal. He highlighted the Optician Apprentice Program as an example, which offers associates the opportunity to become certified opticians, with benefits including tuition reimbursement.
“We often hold ourselves to a higher standard than even state requirements, ensuring every store is staffed with experts who provide best-in-class service,” Blumenthal said on the call. “Through this program, we are not only strengthening our teams, but also fostering long-term career growth.”
Associates will play an essential role in Warby Parker’s partnership with Target, where the eyeglasses retailer will open five shop-in-shops in 2025.
The goal of the collaboration is to introduce more customers to the Warby Parker brand — as well as the Warby Parker experience, according to Blumenthal. The companies share a similar commitment to value and customer experience, making Target a good fit for expansion.
“Culturally, there's a lot of alignment around that,” Blumenthal said. “We feel through these shop-in-shops, which will be managed and run by Warby employees, we will continue to deliver the specialized customer experiences that we're known for across our typical fleet.”
