1-800 Contacts

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1-800 CONTACTS
Type	Privately Held
Founded	1995
Headquarters	Draper, Utah
Key people	Jonathan C. Coon, CEO Brian Bethers, President Kevin McCallum, CMO Rob Hunter, CFO Joe Zeidner General Counsel
Industry	Contact Lens Retail
Products	Contact lenses
Revenue	$237,950,000^[1]
Operating income	$5,734,000^[1]
Net income	($2,605,000)^[1]
Employees	680 (as of August 12, 2007)^[1]
Parent	Fenway Partners
Website	www.1800contacts.com

1-800 CONTACTS is a privately held company based in Draper, Utah that sells the most popular brands of contact lenses, including Johnson & Johnson Vision Care, CIBA Vision, Bausch & Lomb and CooperVision. The company's business model is fundamental to the product itself. Contact lenses are a highly fragmented category - over 5 million theoretical SKUs. Contact lenses come in small, light packages that are easy to ship through the mail and they require frequent replacement by the user. Significant cost efficiencies can be achieved by warehousing a substantial inventory of contact lenses in one location and shipping them directly to consumers. The company combines these distribution and logistical efficiencies with a highly memorable phone number that creates advertising efficiencies as well. The result is a compelling consumer proposition. Today, the company is the largest direct-to-consumer contact lens retailer in the world and maintains the largest inventory of contact lenses on the planet.

1-800 CONTACTS was founded in 1995 by two entrepreneurs who sought to address contact lens wearers' basic frustrations. Wearing contacts themselves, they understood that contact lenses could be expensive and inconvenient to replace. With that in mind, they set out to offer low prices, convenient ordering and fast delivery to their customers. Their plan to accomplish this centered on buying contact lenses in large quantities to get the best prices and housing a large contact lens inventory so customers' prescriptions would be in stock and ready to ship. Superior customer service and easy ordering were also key to their plan, two benefits that distinguished them from the competition.

Core to the company's culture is the mindset of taking excellent care of its associates. The backbone of 1-800 CONTACTS operation is its 320-person call center, half of which work at home. The company offers several benefits to create a positive work environment such as flexible work schedules, an onsite restaurant, fitness center, 401K plan, tuition reimbursement, and a wide selection of medical, dental and long term disability plans. The positive work environment creates highly motivated team members - a key reason why the company has been selected for the Utah Governor’s prestigious Work/Life Award for four consecutive years (2003-2007) and by Utah Business magazine as “The Best Company to Work For” three consecutive years in a row. 1-800 CONTACTS has one of the lowest turnover rates in the call center industry and is a model for the best way to reward and retain top employees.

The company's last publically reported net sales were in the 2006 fiscal year and were $247 million.^[2]

1 J.D. Power and Associates Award
2 Fairness to Contact Lens Consumers Act (FCLCA)
3 Alliance with Wal-Mart
4 Notes
5 References
6 External links

[edit] J.D. Power and Associates Award

In May, 2007 J.D. Power and Associates recognized 1-800 CONTACTS as a certified call center after the company recorded the highest customer service rating ever achieved in the history of their call center certification program. J.D. Power notified 1-800 CONTACTS, INC. of the results in a five-page report based on evaluations with more than 400 callers.

According to J.D. Power and Associates, survey results show 1-800 CONTACTS’ overall satisfaction index score far exceeded the passing score necessary for certification. In fact, it was the highest index score achieved in the history of the call center certification program

1-800 CONTACTS participated in the survey to obtain feedback from the certification process and to gauge itself with respect to other call centers throughout the country. J.D. Power and Associates is known worldwide for its customer satisfaction research in the automotive industry but conducts rigorous certification programs across many businesses – from automotive and finance to retailing and healthcare. In the process, the opinions of millions of consumers and companies are researched. According to J.D. Power all of its marketing research results are based solely on responses from consumers and business-to-business customers who have used the products and services. Award rankings are in no way influenced by the opinion of the firm or its staff.

[edit] Fairness to Contact Lens Consumers Act (FCLCA)

1-800 CONTACTS was the primary proponent of the Fairness to Contact Lens Consumers Act, passed by Congress in November, 2003 and became law in February, 2004. The law a) granted the 36 million contact lens wearers in America the right to their own prescriptions enabling them to shop anywhere they choose to shop, b) established a uniform national standard for prescription release and verification, and c) promotes competition, consumer choice, lower prices and better ocular health.

[edit] Alliance with Wal-Mart

In January, 2008 1-800 CONTACTS entered a long-term agreement with Wal-Mart Stores Inc. to align their contact lens businesses. The alliance combines Wal-Mart savings and the convenience and high quality care of independent eye doctors located in nearly 3,000 Wal-Mart Stores and Sam’s Clubs with 1-800 CONTACTS’ convenience and customer support to help customers save money and live better, healthier lives.

Wal-Mart, Sam’s Club and 1-800 CONTACTS plan to create efficiencies across their call centers, websites, purchasing, and distribution efforts – resulting in customer savings the companies estimate could reach $400 million over the next three years. By offering greater accessibility and savings on contact lenses, the alliance also aims to make it easier to replace lenses according to a schedule doctors recommend, a practice that may result in better eye health.

According to a 2004 Federal Trade Commission report, a McKinsey & Company survey showed that contact lens wearers use lenses longer than their doctor prescribed. Some consumers in that same survey specifically cited cost and “purchasing them is inconvenient” as reasons for over-wearing their lenses.