Dollar Shave Club Enters Razor Wars: ‘Our blades are f— great.’
The Dollar Shave Club has men in a lather.
The e-commerce start-up opened its doors just a few weeks ago, and has already developed a following for its quirky approach to hawking razors and blades for a $3 to $9 monthly fee.
It began with a YouTube video, in which founder and Chief Executive Michael Dubin variously rides on a forklift, plays tennis, and dances with a fuzzy bear. It’s already received some four million views.
Dollar Shave Club, an e-commerce start-up, opened its doors just weeks ago, and has already developed a following for its quirky approach to hawking razors and blades for a $3 to $9 monthly fee. It began with a YouTube video that has already received some 4 million views. Watch a clip from the video. Video courtesy of Dollar Shave Club.
Dollar Shave’s motto? “Our blades are f— great.”
The Santa Monica, Calif., company won’t disclose its number of customers, only noting that 12,000 people signed up in the first 48 hours.
The tiny company has just five full-time employees—and is surely tilting at windmills. Gillette, owned by consumer products giant Procter & Gamble Co., controls 66% of the $12.8 billion global market for men’s razors and blades, according to Euromonitor International. Energizer Holdings Inc.’s ENR +0.98% Schick-Wilkinson Sword has another 12.5% of the market, and Bic SA has 5.2%. The market leaders have huge marketing budgets, deep consumer researchand relationships with retailers that leave little room for newcomers.
But the incumbents, who have turned simple razors into six-bladed machines that are the butt of comics’ jokes, present such a fat target that Silicon Valley investors are starting to bet on entrepreneurs with ideas for shaking things up.
What the start-ups have in their favor is technology. Companies with no marketing budget can command attention with free video and quickly build a following on services like Facebook and Twitter. Moreover, services like Netflix have conditioned consumers to getting regular deliveries of the things they use by mail.
The Dollar Shave Club has raised $1 million in “seed” funding from venture-capital firms including Facebook investor Andreessen Horowitz and Kleiner Perkins Caufield & Byers, which has put money into companies such as Groupon Inc.
Frank says: