please somebody be critical...I cant argue with your analysis FFH. Im probably a bit more bullish on revenue over the course of two years from now. (I started a new chain because all of the "Re:"s were starting to get to me.) The contacts business is stable, no doubt, but it is the eyeglass business that Im really excited about for similar reasons that you have cited, but MORE... While it is true that the company can leverage off of their contacts customers to sell eyeglasses, I actually forsee the company starting to gain more initial customers through the eyeglass business and then expanding to sell THOSE customers contacts and other products.
The word of mouth of cheap contacts is a good thing. The word of mouth of the cheap glasses seems different to me, however, in the passion that people exhibit over their savings. These people actually become walking attention -getting billboards and a testament to coastal's great prices and service. (ie. nobody says "hey julie - are those new contacts youre wearing?")
I believe you can see evidence of this "phenomenon" (I know - a little overkill of a term) when you check out the facebook sites of clearlycontacts or coastal contacts. The growing fanlist and commentary has become mainly focused on the glasses offerings.
Since we are the only two to comment here I dont really want to add too much because it really will just be a conversation with ourselves. Its too bad its not really an active discussion board because I think there are so many angles to the growth/success prospects to this company.