Sunglasses in Malaysia

2021 DEVELOPMENTS

Slower recovery for sunglasses in 2021 due to limited domestic and international tourism opportunities with further restrictions in place

The pandemic is predicted to continue to impact demand for sunglasses over 2021, although it is set to see an upturn in demand; however, given the severity of the category’s decline in 2020 when it was significantly impacted by lack of both domestic and international tourism, a strong growth driver of sunglasses, sales in both volume and value terms will remain below pre-pandemic levels until at least 2022.

Greater adoption of omnichannel approach to sales and utilisation of digital tools

The closure of non-essential stores during the most restrictive of measures over 2020 and part of 2021 has resulted in further share gain for e-commerce, at the expense of department stores, apparel and footwear specialist retailers and the dominant optical shops. Virtual try-on technology is being increasingly incorporated to enhance the competitiveness of e-commerce as pure online players or retailers which have adopted an omnichannel approach to sales, hampered by store closures, adapt to a restrictive operational environment by offering augmented reality, either through their websites or as apps which can be downloaded on smartphones, which allows consumers to “try on” various styles of sunglasses.

Global brands lead increasingly fragmented competitive landscape

While dominated by smaller players under “others” which continued to gain value share in 2020 as increasingly price-sensitive consumers searched for more affordable options, sunglasses continued to be led by global players and brands. Global brands are supported by large selections, high marketing resources and strong distribution networks.

PROSPECTS AND OPPORTUNITIES

2022 likely to see full recovery of sunglasses in demand terms, although predictions are strongly linked to return of tourism and relaxation of restrictions

The full recovery of sunglasses is highly reliant on tourism, both domestic and international, and with further restrictions in place until at least the end of Q2 2021 with the possibility of further extensions until virus case numbers have reached a satisfactory level, movement both within the country and inbound visitors to Malaysia could be further subdued. However, with the further rollout of the country’s vaccination efforts, the government is in talks to agree the introduction of green corridors with suitable source markets.

Slower recovery for value sales as further discounting activity likely

Lingering price sensitivity amongst local consumers is likely to result in further strong marketing strategies by retailers and manufacturers to drive up volume sales of sunglasses. While this is predicted to positively impact overall demand, value sales (at constant 2021 prices) are set to take longer to fully recover to pre-pandemic levels to 2023, as significant discounts continue to be offered both in-store and online.

Further development of e-commerce likely

While store-based retailers such as optical shops and high street apparel and footwear specialist retailers will remain popular amongst many consumers, allowing them to try on different styles of sunglasses, the advances made in terms of digital tools which has helped to drive greater demand through e-commerce since the pandemic emerged, in addition to lingering concerns regarding contact with products in-store with the virus still in circulation despite stringent steps in place to minimise its spread, offer further potential for expansion of online channels. An increasing number of players and retailers are likely to tap into the online sales space in order to offer an omnichannel approach to sales which offers greater convenience and flexibility to the consumer.