The average person doesn't consider them to be a viable option. Don't ask me why, but it's true. And them being considered a viable option is a prerequisite to competition working right.
The average person (at least in the US) does not consider the world’s largest retailer, with a well known reputation for being the cheapest, an option? I don’t buy that.
That WalMart link is to decorative glasses, not prescription glasses.
So here's the thing with WalMart and Luxottica - their insurance does not fully cover WalMart! They give you a significantly reduced amount with WalMart (or Costco), that's how you know it's fraudulent - they only want to cover their own stores, that's not a normal behavior for "insurance".
High profit margins are also bad when it's something people need.
The competition isn't working right, for a variety of reasons, and so the mere existence of competition does not make those problems disappear.