Brand Control

The Warby Parker-Target concept is more akin to an in-line mall store than the more integrated Target and brand models such as Ulta, Apple, Levi’s, and even Caribou Coffee. Following the retail licensing/concession model, Warby-at-Target comes complete with a glazed storefront and its own door. It’s about total brand control.

Warby understands its extraordinary brand value is a direct result of its obsessive control over every brand touchpoint throughout the customer’s ever-evolving “path to purchase.” Every aspect of the WP brand is holistic and speaks in one voice, including its website, marketing, product design, store design, and great personal service. In the amorphous Target environment, a separate door clearly demarcates WP from its host store and makes its customers and staff feel safe, secure — clearly in a WP space and place untarnished by a big-box soulless interior.  It’s a smart marketing and design strategy.

This dedication to brand integrity has enabled Warby Parker to evolve from one of the most dominant digital native retail brands to becoming an equally successful unified commerce brand with over 300 retail stores in the U.S. and Canada. Now WP is reaching out to a new audience, more mainstream by definition, managing and operating the Target shops with its own trained Warby Parker staff, thereby ensuring their high value offering.   

Scaled Design

From the point of view of a recovering store designer (me), the store is a smash hit. It is nothing less than a slightly downsized, impeccably merchandised retail offspring. Warby Parker’s fleet of stores ranges from this tidy 1,000 square foot Target shop-in-shop to 2,500 square foot stores, with an average footprint of 1,600 square feet. At Target, Warby Parker’s full product and service offering includes glasses, sunglasses, contacts, eye exams and vision tests; there is an exam room for their on-site opticians.

From the product SKU perspective, customers won’t feel short-changed. The WP design team has managed to shoehorn in 18 bays of eyewear, comparable to larger stores in the chain. Overall, there’s one problematic element: The shop’s aisles are ample for normal traffic trying on and buying, however, one or two massive Target shopping carts will blow the flow.

By the Numbers

While there haven’t been any disclosures on the financial terms underpinning the partnership, Warby Parker is likely paying Target for space and retains most operational autonomy. So, who stands to benefit from this partnership the most?

Target stores currently generate approximately $438 per square foot in annual revenue. This figure reflects performance across their nearly 2,000 U.S. locations and includes both general merchandise and specialty categories like apparel, beauty, and home goods.

Meanwhile, Warby Parker reportedly generates around $3,000 per square foot annually, putting it in the same league as high-performing retailers like Apple and Tiffany. That’s a lot more revenue power packed into a small space. I suspect the speed of the actual store rollout may be impacted by how well these initial stores perform, but I think this could be a win for both parties.

Adios Ulta

The elephant in Target’s room may well be cosmetics. The WP launch runs in tandem with Ulta Beauty’s announced decision to end its four-year partnership with Target, with shop closures expected by August 2026. Coincidentally, the 1,000 square foot Ulta spaces match the new Warby-in-Target footprint. Longer term, Ulta expects its “divorce” decision will boost traffic and revenue to its wholly owned stores. It has been reported that the Ulta-in-Target stores generated royalty revenue well below one percent of net sales over fiscal 2024.

In a recent interview, Ulta’s president and CEO Kecia Steelman, was asked about plans to increase its store count to compensate for pulling out of Target; she responded: “I’ve got plenty of stores where I could pick up that volume in existing store format. So, there is no need to suddenly be more aggressive and open stores because we are moving away from the partnership with Target.” Okay then!   

The Vision Prize

Optical is not new for Target. It first partnered with Luxottica to open Target Optical shops inside its stores back in 1995. And EssilorLuxottica renewed its licensing agreement with Target in February 2023 for the 580 Target Optical stores it occupies. Like the Warby Parker arrangement, those eyewear and vision care departments are operated and managed by Luxottica Retail North America. EssilorLuxottica is the world’s leading optical retailer, owning and operating LensCrafters, Sunglass Hut, and Pearle Vision, along with manufacturing and/or licensing nearly two dozen of the top eyewear brands, including Ray-Ban, Oakley, Persol, Oliver Peoples, and the list goes on.

According to Target’s official press release, the new Warby Parker shops will open in locations without existing Target Optical offerings. Duh.

Who Wins in the Target – “Warby Parknership”

Retail partnerships of this nature have been going on for eons. Department stores began subletting space to cosmetics companies in the early to mid-20th century, but the practice became especially widespread in the post-war retail boom of the 1950s and 1960s.

Best Buy has accelerated the “store-within-store” model through the plethora of tech brands that pay to play in their digital playground. However, the win-win nature is not always evenly matched. And as far as the Target-WP deal goes, I believe Warby Parker could be the big winner; here’s why:

• Captive Audience. While it’s unlikely that WP expects “destination visits” to Target for the sole purpose of trying on or buying their eyewear, the brand exposure and broadening their audience is a sure bet. Whether it tarnishes the brand for existing WP customers remains to be seen.
  
  
• Cost Savings. In comparing the sky-high costs of tenant buildout in a typical regional mall or freestanding street location, combined with associated common-area maintenance (CAM) costs, with that of a more moderate Target shop-in-shop, the latter is the winner. 

• Online/In-Store Synergy – It has been well established that the addition of a physical store to a digital-first brand reduces customer acquisition costs and drives incremental online traffic. The Target move increases Warby’s zip-code coverage without committing to long-term mall leases. With Warby Parker’s highly refined digital marketing machinery, the benefits include a robust, new data trove.

Will Target Diminish WP?

Even with the potential positives for WP, one might question what the long-term strategy here is (if there is one). The WP partnership is a gamble for the brand that has made its mark based on its popularity with young, hip customers. Is that a good match with the typical Target customer?  Will it confuse Target’s shopper who is not necessarily a WP customer, let alone aware of the brand? And what about WP’s shiny, clean interior design in Target’s tired big box stores?

Warby Parker started life as a niche brand offering and has broadened its marketing strategy as it has scaled. The skeptic could ask, “At what price to brand integrity is scaling to the masses?” On the other hand, 79 percent of Americans wear eyeglasses. That market is clearly irresistible.